Annual Report 2016-17 · 2017–18 FEDERAL BUDGET $8.4 billion secured for Inland Rail and up to...

Annual Report 2 0 1 6 – 1 7

DEPARTM

ENT OF IN

FRASTRUCTURE AND

REGION

AL DEVELOPM

ENT

ANN

UAL REPO

RT 2016–17

ANNUAL REPORT

Department of Infrastructure and Regional Developm

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© Commonwealth of Australia 2017 ISBN 978-1-925531-73-2 October 2017 / INFRASTRUCTURE 3268

Ownership of intellectual property rights in this publicationUnless otherwise noted, copyright (and any other intellectual property rights, if any) in this publication is owned by the Commonwealth of Australia (referred to below as the Commonwealth).

Disclaimer The material contained in this publication is made available on the understanding that the Commonwealth is not providing professional advice, and that users exercise their own skill and care with respect to its use, and seek independent advice if necessary. The Commonwealth makes no representations or warranties as to the contents or accuracy of the information contained in this publication. To the extent permitted by law, the Commonwealth disclaims liability to any person or organisation in respect of anything done, or omitted to be done, in reliance upon information contained in this publication.

Creative Commons licenceWith the exception of (a) the Coat of Arms; (b) the Department of Infrastructure and Regional Development’s photos and graphics; and (c) [OTHER], copyright in this publication is licensed under a Creative Commons Attribution 3.0 Australia Licence.Creative Commons Attribution 3.0 Australia Licence is a standard form licence agreement that allows you to copy, communicate and adapt this publication provided that you attribute the work to the Commonwealth and abide by the other licence terms. A summary of the licence terms is available from <http://creativecommons.org/licenses/by/3.0/au/deed.en>.The full licence terms are available from <http://creativecommons.org/licenses/by/3.0/au/legalcode>.This publication should be attributed in the following way: ©Commonwealth of Australia 2017.

Use of the Coat of ArmsThe Department of the Prime Minister and Cabinet sets the terms under which the Coat of Arms is used. Please refer to the Department’s Commonwealth Coat of Arms and Government Branding web page <www.dpmc.gov.au/> and in particular, the Commonwealth Coat of Arms–Information and Guidelines publication.

Contact usThis publication is available in hard copy or PDF format at <www.infrastructure.gov.au/department/annual_report/index.aspx>. All other rights are reserved, including in relation to any departmental logos or trademarks which may exist. For enquiries regarding the licence and any use of this publication, please contact:Director—Publishing and Internal Communications Communications, Parliamentary and Governance Branch Department of Infrastructure and Regional Development GPO Box 594 Canberra ACT 2601 AustraliaEmail: [email protected] Website: www.infrastructure.gov.au

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Letter of transmittal

Senator the Hon Fiona Nash Secretary Minister for Regional Development Minister for Local Government and Territories Parliament House CANBERRA ACT 2600

Dear MinisterI am pleased to present the Annual Report for the Department of Infrastructure and Regional Development for the year ended 30 June 2017.The Department’s report has been prepared in accordance with section 46 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) which also requires that you present this report to the Parliament.In accordance with sections 39(1)(b) and 43(4) of the PGPA Act, this report includes the Department’s annual performance statements and audited financial statements. I certify:• in accordance with sections 17AG and 17BE of the Public Governance, Performance and

Accountability Rule 2014 (PGPA Rule), there were no significant issues of non-compliance notified during the reporting period; and

• in accordance with sections 10 and 17AG of the PGPA Rule, the Department has prepared a fraud risk assessment and a fraud control plan, and has in place appropriate fraud prevention, detection, investigation and reporting mechanisms to meet the specific needs of the Department.

This report also includes information required by:• paragraph 11.1(ba) of the Legal Services Directions 2017;• paragraph 5.15(2) of the Airports (Environment Protection) Regulations 1997;• section 29 of the Air Navigation Act 1920;• section 20 of the Aircraft Noise Levy Collection Act 1995;• section 94 of the National Land Transport Act 2014;• section 311A of the Commonwealth Electoral Act 1918;• schedule 2, part 4 of the Work Health and Safety Act 2011; and• section 516A of the Environment Protection and Biodiversity Conservation Act 1999.I have copied this letter to the Hon Darren Chester MP, Minister for Infrastructure and Transport and the Hon Paul Fletcher MP, Minister for Urban Infrastructure.

Yours sincerely

Mike Mrdak AO September 2017


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Guide to this report

What this report coversThis annual report explains how the resources entrusted to the Department of Infrastructure and Regional Development have been used during the year. It takes into account the Department of Finance’s Resource Management Guide No. 135: Annual Reports for Non‑Corporate Commonwealth Entities, issued May 2017.

How information is presentedKey terms and acronyms are explained as they are introduced and are listed at the back of this report.

Tables throughout the report use notations as follows:

• $m means million dollars;• – means either zero or nil; and• n/a means not applicable.

How to obtain copiesReports are available in printed form from libraries around Australia under the Australian Government library deposit and free issue scheme. For a list of these libraries, visit the Department of Finance website <www.finance.gov.au/librarydeposit>.

This report is also available at <www.infrastructure.gov.au/department/annual_report/index.aspx>. It is published in a variety of digital formats to make it more accessible, including to people in regional areas and people with a disability. It is available online the day after it is tabled in Parliament.

More informationBefore making decisions or acting on information in this report, you are advised to contact the Department. This report was up-to-date when it was tabled, but details change over time due to legislative, policy and other developments.

If you have suggestions about how we could improve our annual report, please let us know. To contact our annual report team, you can write to us at (no stamp required):

Governance Section Reply Paid 594 CANBERRA ACT 2601

Contact details for other parts of the Department are available at <www.infrastructure.gov.au>.

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Contents

Contents

PART 1: YEAR IN REVIEW 01

Secretary’s review 04

Financial performance for 2016–17 08

PART 2: DEPARTMENT OVERVIEW 13

Role and functions 14

Purposes 15

Vision 15

Mapping our purposes, programs, outcomes and division structure 16

Organisational structure 17

Ministers 18

Executive team 18

The portfolio 20

PART 3: ACTIVITIES 25

Infrastructure Investment 26

Transport Security 30

Surface Transport 34

Road Safety 38

Air Transport 41

Regional Development 46

Local Government 49

Services to Territories 50

PART 4: MANAGEMENT AND ACCOUNTABILITY 53

Corporate governance 54

Grants 60

External scrutiny 60

Management of human resources 62

Assets management 68


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PART 5: ANNUAL PERFORMANCE STATEMENTS 71

Annual performance statements for 2016–17 73

Performance against purpose 1: Promote, plan, evaluate and invest in infrastructure and regional development 76

Performance against purpose 2: Foster an efficient, sustainable, competitive, safe and secure transport system 80

Performance against purpose 3: Strengthen the sustainability, capacity and diversity of regional economies and support local communities 94

Performance against purpose 4: Provide good governance in Australian territories 97

PART 6: FINANCIAL STATEMENTS 99

PART 7: APPENDICES 159

Appendix A: Entity resource statements and expenses for outcomes 160

Appendix B: Procurement practices 172

Appendix C: Ecologically sustainable development and environmental performance 175

Appendix D: Report under the Work Health and Safety Act 2011 179

Appendix E: Reports under aviation legislation 181

Appendix F: Report under the National Land Transport Act 2014 182

Appendix G: Correction of material errors in 2015–16 Annual Report 183

Appendix H: Summary of administered expense programs 184

Appendix I: List of requirements 186

PART 8: KEY TERMS AND INDEX 193

Glossary 194

Acronyms 197

Index 199

1YEAR IN REVIEW


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The Department received

Issued 2,661 vehicle certifications,

7,483 Registered Automotive Workshop

Scheme (RAWS) import approvals and

6,733 RAWS used import plate approvals

Black Spot

projects completed and 302

underway

$5.2 billion provided towards road and rail projects

498

$47.8 million to help reduce the cost of travel across Bass

Strait for passengers with eligible vehicles

$137.6 million to shippers under the

Tasmanian Freight Equalisation Scheme

keys2drive learner driver program provided more than

260,000 drivers with free lessons and

resources

Over 100 Bureau of Infrastructure, Transport and Regional Economics (BITRE) publications released, providing critical information on transport and regional economics factors needed to inform effective investment decisions

$110.7 million towards 107 projects that support regional development

National Stronger Regions Fund

transport security

compliance activities

COMPLETED176 audits

302 inspections

309 system tests

787 Release of the

Regions 2030: Unlocking Opportunity

publication

Discussion paper released on coastal shipping reform

Welcomed 27 new participants as part

of the Graduate Development Program

Established a 10-year investment program allocation for funding road and rail investments

parliamentary questions on notice

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Part 1: Year in review

Department’s Twitter

account launched @infra_regional

$18.1 million to the operation of 55 Regional Development Australia Committees which support the development of their regions

$14.4 million to subsidise aviation services to 266 designated remote communities

COMMUNITY DEVELOPMENT GRANTS

$66.0 million towards 142 infrastructure projects

which promote stable, secure and viable local and regional economies

10 businesses operating at 38 sites

approved to examine US-bound air cargo at piece-level in accordance with Enhanced Air Cargo

Examination notices

Participated in

11 innovation capability workshops

2017–18 FEDERAL BUDGET

$8.4 billion secured for

Inland Rail and up to

$5.3 billion secured for the Western Sydney Airport

Ensured services and essential infrastructure in the external territories and Jervis Bay Territory met community needs

Modernising Airspace Protection paper released for public consultation – 46 submissions received

Commenced public consultation for the Inquiry into National Freight and Supply Chain Priorities which will inform the development of a long-term strategy

Secured 17 new and updated air services

arrangements, including with China,

Fiji and Italy


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Secretary’s reviewIt is my pleasure to present the Department of Infrastructure and Regional Development’s 2016–17 Annual Report. I am pleased to highlight the significant achievements made across our diverse portfolio, the outcomes of which benefit all Australians wherever they live.

Major projectsIn last year’s report, I noted the Department’s work in progressing the Melbourne to Brisbane Inland Rail and Western Sydney Airport—two of the largest projects of their kind in Australia’s history. Since the last reporting period, both projects have progressed considerably. The Department’s policy and technical advice to the Australian Government supported the commitment of a further $8.4 billion for Inland Rail and up to $5.3 billion for the Western Sydney Airport as part of the 2017–18 federal budget.

Working with state and territory governments, the Department progressed major road and rail projects under the Infrastructure Investment program to improve the efficiency, sustainability and competitiveness of Australia’s land transport networks, as well as to support jobs. Major projects included the Western Sydney Infrastructure Plan, NorthConnex, WestConnex, Toowoomba Second Range Crossing, the Victorian Infrastructure Package and the North‑South Corridor in SA. 2016–17 also saw the completion of significant projects such as the $1.0 billion Moreton Bay Rail Link in Queensland and $34.0 million of upgraded roads in Western Sydney as part of the Local Roads Package.

Infrastructure planningWell-targeted infrastructure investment is underpinned by robust infrastructure planning. Several major planning initiatives commenced in 2016–17. In line with the Australian Government’s response to Infrastructure Australia’s 15-year plan, the Department started work on urban rail plans for Australia’s five largest cities and surrounding regions and on the development of a data collection and dissemination plan to improve the collection of freight and public transport data.

The Department also ran a series of scenario planning workshops, as part of our broader scenario planning work, to develop capability in actively and strategically considering our long-term environment, the implications on our work and how to develop and adapt priorities accordingly. A discussion paper was also launched on making better use of value capture to fund critical infrastructure.

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Working across transport modesTo enhance Australia’s overall transport system, we worked domestically and internationally on improvements across road, rail, aviation and maritime. To improve safety and access for Australian road-users, we completed 3,420 projects under the Roads to Recovery, Black Spot, Heavy Vehicle Safety and Productivity and Bridges Renewal programs and we administered vehicle safety standards reflective of internationally agreed standards.

The Department continued to progress heavy vehicle road reform and work to investigate the potential benefits and costs of extending road user charging to light vehicles, in the interest of establishing a fairer and more transparent way of road user charging. A key milestone delivered in 2017 was the release of the Land Transport Market Reform Independent price regulation of heavy vehicle charges discussion paper, which sought stakeholder views on establishing independent price regulation for heavy vehicle charges.

We continued to support ongoing infrastructure investment at federally leased airports through fit‑for‑purpose aviation regulation—ensuring our airports can meet projected growth. We also provided $14.4 million to subsidise aviation services to remote communities where they are not commercially viable and $9.2 million towards the maintenance of safe aviation infrastructure.

In the maritime sector, the Coastal Shipping Reforms discussion paper was released to seek stakeholder views on coastal shipping reform—the Australian Government received 67 submissions for consideration. We also continued to oversee implementation of Tasmanian transport schemes to promote sea travel and trade between Tasmania and mainland Australia.

We progressed Australia’s transport interests abroad at international engagements during the year. Through international negotiations, we secured new air services agreements with 17 economies that increased market, trade and travel opportunities for Australians, including an ‘open-skies’ arrangement with China. Adding to this, we continued to work as part of the International Civil Aviation Organization and the International Maritime Organization (IMO) to shape international policies, uphold Australian interests and ensure our domestic policies align with international practices. In the IMO, we agreed the outline of an initial strategy to reduce greenhouse gas emissions from shipping. We revised the Facilitation Convention to reflect modern day shipping practices and worked toward the establishment of a maritime ‘single window’ to facilitate international ship traffic, of which 30 per cent of Australia’s GDP depends. The Department also continued to contribute on transport matters to the Asia‑Pacific Economic Cooperation through membership of the Transportation Working Group.

2016–17 saw major achievements made in transport security. In September 2016, a world first, one‑stop security agreement—the ‘Capital Express’ One Stop Security Agreement—was signed between Australia, New Zealand and Singapore. The agreement streamlines the security process for passengers transiting Canberra, meaning they now spend less time in security queues and have a more relaxed experience.

In October 2016, changes to the aviation and maritime security identification card (ASIC and MSIC) schemes were approved by the Federal Executive Council. These changes improve ASIC and MSIC integrity and are the most significant changes made to the schemes since their establishment. In November 2016, two major changes were made to the


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regulation of air cargo security in Australia to ensure over $6.0 billion of annual air freight exports to the United States will continue without disruption.

Lastly, Inspector of Transport Security, Michael Carmody AO, completed an inquiry into aviation and maritime transport security education and training in Australia. All recommendations were accepted and the Office of Transport Security has worked with industry to commence their implementation in accordance with report priorities.

Dedicated assistance for Australia’s regions, local governments and territoriesIn 2016–17, we continued to administer dedicated regional funding programs and regional investments to strengthen the sustainability, capacity and diversity of Australia’s regions. Two new regional programs were established to support infrastructure and community investment projects in regional and remote Australia: the nearly $500.0 million Building Better Regions Fund and the $220.0 million Regional Jobs and Investment Package. Through our regional programs, we assisted regional communities to realise projects which will make their communities even better places to live, including medical support facilities, leisure centres and dedicated youth spaces.

Development and maintenance of a regional evidence base and a forward-looking policy agenda are essential for planning regional development now and in the future. The Progress in Australian Regions – Yearbook 2016 was published, providing an updated regional evidence base to track the trends affecting regions. The Department also developed the Regions 2030: Unlocking Opportunity publication, launched in May 2017 by Senator the Hon Fiona Nash, Minister for Regional Development, Minister for Local Government and Territories, outlining the Australian Government’s vision for Regional Australia.

During 2016–17, the Department administered $3.5 billion through the Local Government Financial Assistance Grants program to further support 546 local governing bodies to deliver services and infrastructure to their communities. We also continued to ensure communities in Australia’s external territories and the Jervis Bay Territory maintain access to essential services, good governance and infrastructure. This included starting the second stage of the reform agenda for Norfolk Island to provide further legislative reforms and state services to residents, and to standardise Australian Government service delivery to the island.

Performance frameworkWe took the opportunity this year to revise our departmental performance measures to better articulate the effects of our activities. The new measures, reported on in the annual performance statements within this report, are informed first and foremost by our understanding of what the Department’s success looks like for our key stakeholders. As a Department, we have also undertaken a review of our overall performance framework, including purposes and associated measures, which we look forward to presenting in 2017–18.

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The year ahead2017–18 has commenced with a focus on priorities arising from the federal budget, in particular overseeing further funding for major projects. Looking at the milestones achieved in 2016–17, we will likely have another productive year ahead in progressing these projects further. In addition to the continued administration of existing programs and projects, we will continue to plan and engage with stakeholders to foster new opportunities across infrastructure, transport and regional development for the benefit of all Australians.

For more information on our priorities and activities for the year ahead, I encourage you to view our 2017–18 Corporate Plan, which is available at <www.infrastructure.gov.au/department/about/corporate‑plan.aspx>.


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Financial performance for 2016–17Departmental activities involve the use of assets, liabilities, revenue and expenses controlled or incurred by the Department in its own right. Administered activities involve management or oversight by the Department, on behalf of the Australian Government, of items controlled or incurred by the Australian Government.

This section should be read in conjunction with the Department’s audited financial statements for 2016–17, in Part 6 of this report titled ‘Financial statements’.

Departmental financesIn 2016–17, the Department reported a deficit on continuing operations of $4.4 million. This equates to a surplus of $4.9 million after allowing for net cash appropriation arrangements1.

Compared to 2015–16, revenue from the Australian Government in 2016–17 reduced by $13.2 million. The reduction reflects funding withheld under section 51 of the Public Governance, Performance and Accountability Act 2013 due to the deferral and reclassification of expenses for the Western Sydney Airport project.

Gains in 2016–17 decreased by $9.3 million mainly due to one-off gains recognised in 2015–16 for the waiver of make good requirements on entering into new lease agreements in Canberra.

Total expenses decreased by $9.7 million largely due to a reduction in:

• employee benefits expenses of $5.8 million due to a lower average staffing level and changes in the valuation of long service leave provisions; and

• depreciation and amortisation expenses of $2.9 million due to changes in the valuation of leasehold improvement assets following the new lease agreements.

The Department’s commitment to financial management continues to be reflected in its financial performance and unqualified financial statements.

Table 1.1 provides a summary of the Department’s financial performance and position.

1 Under net cash appropriation arrangements, the Department does not receive an appropriation for depreciation and amortisation expenses. Separate capital budget funding is provided through equity appropriations.

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Table 1.1 Summary of departmental financial performance and position ($m)

2012–13 2013–14 2014–15 2015–16 2016–17Change

last year

Revenue from Government 180.7 231.1 250.2 261.7 248.5 (13.2)

Other revenue 7.0 5.8 6.7 4.7 4.3 (0.4)

Gains 6.7 8.2 26.3 10.4 1.1 (9.3)

Total income 194.4 245.1 283.1 276.8 253.9 (22.9)

Employee and supplier expenses 189.5 230.4 252.6 253.7 248.2 (5.5)

Depreciation and amortisation 10.2 11.6 12.5 12.2 9.3 (2.9)

Other expenses 0.9 1.1 8.1 2.0 0.8 (1.2)

Total expenses 200.5 243.0 273.2 268.0 258.3 (9.7)

Surplus (Deficit) attributable to the Australian Government (6.1) 2.1 9.9 8.9 (4.4) (13.3)

Plus non-appropriated depreciation and amortisation expenses

10.2 11.6 12.5 12.2 9.3 (2.9)

Operating result (Loss) attributable to the agency 4.0 13.7 22.4 21.1 4.9 (16.2)

Financial assets A 88.0 136.0 130.8 133.5 147.0 13.5

Non‑financial assets B 40.0 50.4 35.9 43.5 40.6 (2.9)

Liabilities C 68.9 106.8 85.9 68.7 73.5 4.8

Net assets – A + B - C 59.1 79.6 80.8 108.3 114.1 5.8

Administered financesTotal administered expenditure in 2016–17 was $11.4 billion; of this $6.1 billion was appropriated directly to the Department for grants, subsidies and other administered expenses. The Treasury is appropriated directly for payments to and through states and territories for national partnership agreements.

Major expense items in 2016–17 were:

• Local Government Financial Assistance Grants ($3,472.9 million);• Infrastructure Growth Package ($815.5 million);• write-down of assets and concessional loan expenses ($542.9 million);• Tasmanian Freight Equalisation Scheme ($137.6 million);• payments to corporate Commonwealth entities ($122.5 million);• Services to Indian Ocean Territories ($115.4 million); • National Stronger Regions Fund ($110.7 million); and• Infrastructure Investment Program ($109.2 million).


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In aggregate, administered programs were $152.0 million or 1.3 per cent lower than the latest budgets published in the Department’s and the Treasury’s 2017–18 Portfolio Budget Statements. Combined expenses in 2016–17 were higher than the prior year by $4.2 billion largely due to:

• a Determination by the Treasurer to bring forward Financial Assistance Grant payments from 2017–18 ($2.3 billion);

• uneven profiles for infrastructure projects account for $1.2 billion of the movement in the Infrastructure Investment Program ($1.1 billion), the Infrastructure Growth Package ($162.7 million), the Asset Recycling Fund ($222.7 million) and the Western Sydney Infrastructure Plan ($137.1 million);

• write-down and impairment of assets of $425.3 million largely due to lease arrangements for Commonwealth owned land at Moorebank NSW and Melbourne Airport; and

• concessional loan expenses of $117.6 million largely associated with the WestConnex concessional loan.

In 2016–17, non-taxation revenue decreased by $48.2 million largely due to contributions recognised in 2015–16 towards flight MH370 search costs and reduced dividend revenue. Taxation revenue collected on behalf of the Australian Government increased by $2.3 million largely due to a land tax equivalent payment received from the Moorebank Intermodal Company Ltd.

Administered net assets increased by $1.2 billion in 2016–17. This was largely due to:

• advances paid from the WestConnex concessional loan of $0.5 billion;• an increase in the fair value of the Australian Government’s investment in Airservices

Australia of $0.4 billion; and• an increase in the fair value of land assets.

Table 1.2 provides a summary of administered financial performance and is based on information reported in the Department’s financial statements. It excludes items for which the Treasury is appropriated directly.

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Table 1.2 Summary of administered financial performance and position ($m)

2012–13 2013–14 2014–15 2015–16 2016–17Change

last year

Taxation revenue 24.8 34.4 36.3 39.4 41.7 2.3

Non-taxation revenue 1,241.4 1,520.0 536.7 408.9 360.7 (48.2)

Gains - 0.1 65.7 11.2 11.8 0.6

Total income 1,266.2 1,554.5 638.7 459.4 414.2 (45.2)

Employee and supplier expenses 18.1 100.4 124.2 137.2 157.5 20.3

Depreciation and amortisation 1.2 29.1 43.8 39.9 53.9 14.0

Grants 1,816.7 3,431.6 4,799.6 2,908.4 5,127.5 2,219.1

Subsidies 161.5 164.9 187.6 195.7 206.2 10.5

Other expenses 0.3 0.8 54.0 6.2 543.3 537.1

Total expenses 1,997.8 3,726.9 5,209.2 3,287.5 6,088.4 2,800.9

Financial assets A 4,496.7 4,727.8 5,391.2 5,387.6 6,422.5 1,034.9

Non‑financial assets B 65.2 700.3 647.5 881.3 1,029.5 148.2

Liabilities C 25.3 66.5 71.6 55.5 56.9 1.4

Net assets – A + B - C 4,536.6 5,361.6 5,967.1 6,213.4 7,395.1 1,181.7

2DEPARTMENT OVERVIEW


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Part 2: Department overview

Role and functionsThe Department of Infrastructure and Regional Development is at the forefront of the Australian Government’s efforts to secure Australia’s economic future and improve living standards. This is achieved through infrastructure planning, strategic investment in transport infrastructure, transport system reform, regulation of transport safety and security, and strategic development of policies and programs. The Department assists Australia’s regions and communities to strengthen their economic base and provides the external territories and the Jervis Bay Territory with community services and capital investment.

We are responsible for:

• infrastructure planning and coordination;

• transport safety;

• land transport;

• civil aviation and airports;

• transport security;

• maritime transport;

• major projects;

• territory reforms and service delivery;

• regional development policy and coordination; and

• local government programs.

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PurposesIn 2016–17, the Department worked to achieve four purposes, provided in Table 2.1.

Table 2.1 Departmental purposes and outcomes

Purpose Related Outcome, set out in the 2016–17 Portfolio Budget Statements

Promote, plan, evaluate and invest in infrastructure and regional development

Outcome 1: Improved infrastructure across Australia through investment in and coordination of transport and other infrastructure.

Foster an efficient, sustainable, competitive, safe and secure transport system

Outcome 2: An efficient, sustainable, competitive, safe and secure transport system for all transport users through regulation, financial assistance and safety investigations.

Strengthen the sustainability, capacity and diversity of regional economies and support local communities*

Outcome 3: Strengthening the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities; and providing grants and financial assistance.

Provide good governance in the Australian territories

Outcome 4: Good governance in the Australian territories through the maintenance and improvement of the overarching legislative framework for self-governing territories, and laws and services for non-self-governing territories.

Note: * This purpose was changed from that in the 2016–17 Portfolio Budget Statements, which read “facilitate local partnerships between all levels of government and local communities”.

VisionOur work is informed by our vision to build capability through:

• having a view on the right outcome;• driving policy reform;• leading program and project delivery;• leading effective regulation;• leading Australian investment strategy and planning; and• fostering a high-performing workforce.


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Mapping our purposes, programs, outcomes and division structureTable 2.2 Departmental purpose, program, outcome and division structure

at 30 June 2017

Purpose Program Outcome Division*

Promote, plan, evaluate and invest in infrastructure and regional development

Program 1.1 Infrastructure Investment

Outcome 1 Improved infrastructure across Australia through investment in and coordination of transport and other infrastructure.

Infrastructure Investment

Inland Rail Unit**

Foster an efficient, sustainable, competitive, safe and secure transport system

Program 2.1 Transport Security

Outcome 2 An efficient, sustainable, competitive, safe and secure transport system for all transport users through regulation, financial assistance and safety investigations.

Office of Transport Security

Inspector of Transport Security

Program 2.2 Surface Transport

Surface Transport Policy

Program 2.3 Road Safety

Program 2.4 Air Transport

Aviation and Airports

Western Sydney Unit

Strengthen the sustainability, capacity and diversity of regional economies and support local communities

Program 3.1 Regional Development

Outcome 3 Strengthening the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities; and providing grants and financial assistance.


Local Government and TerritoriesProgram 3.2

Local Government

Provide good governance in the Australian territories

Program 4.1 Services to Territories

Outcome 4 Good governance in the Australian territories through the maintenance and improvement of the overarching legislative framework for self-governing territories, and laws and services for non-self-governing territories.

Local Government and Territories

Notes: * The Policy and Research Division contributed to the delivery of all programs. ** The Inland Rail Unit was established in June 2017.

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Organisational structureIn 2016–17, the Department administered $6.4 billion across a number of major business lines, as shown in Figure 2.1. The Department comprises eight business divisions supported by the Corporate Services Division, which provided essential services and advice for all divisions. The work of business divisions in delivering outcomes in areas such as productivity, infrastructure, transport reform and regional economics is also supported by the Policy and Research Division.

Figure 2.1 Organisational structure at 30 June 2017

Minister for Regional Development, Minister for Local Government and Territories

Minister for Infrastructure and Transport

Minister for Urban InfrastructureSecretary

Deputy Secretary Deputy Secretary

Corporate Services


Surface Transport

Policy

Policy and Research

Local Government and

Territories

Aviation and Airports

Office of Transport Security

Western Sydney Unit

Inland Rail Unit

Financial Services

Information Services

People and Performance

Legal Services

Communications, Parliamentary

and Governance


Policy

North West Infrastructure

Projects

South East Infrastructure

Projects

Rail Policy and Planning

Major Infrastructure Projects Office

Regional Programs

Maritime and Shipping

Vehicle Safety Standards

Road Safety and Productivity

Strategic Policy

Policy Development

Unit and Regulatory

Reform

Bureau of Infrastructure,

Transport and Regional Economics

Regional Economic Policy

Regional Jobs and Investment

Packages

Land Transport Market Reform

Indian Ocean Territories

Norfolk Island

Local Government, Mainland Territories

and Regional Development

Australia

Aviation Industry Policy

Airports

Aviation Environment

Air Traffic Policy

Aviation Security

Transport Security

Operations

Transport Security

Operations Reform

Air Cargo Security

Taskforce

Risk and International

Maritime, Identity and

Surface Security

Transport Security

Education and Training

Financial, Commercial and

Operations

Communications, Environment and

Legal


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MinistersIn 2016–17, the Department was accountable to Senator the Hon Fiona Nash, Minister for Regional Development, Minister for Local Government and Territories; the Hon Darren Chester MP, Minister for Infrastructure and Transport; and the Hon Paul Fletcher MP, Minister for Urban Infrastructure.

Senator the Hon Fiona Nash Minister for Regional

Development Minister for Local

Government and Territories

The Hon Darren Chester MP Minister for Infrastructure

and Transport

The Hon Paul Fletcher MP Minister for Urban

Infrastructure

Executive team

Mike Mrdak AO: SecretaryIn 2016–17, Mike Mrdak led the Department for the eighth consecutive year in its wide range of activities. These include policy development, regulatory reform and program implementation to support the Australian Government’s infrastructure agenda, national transport reform initiatives and commitment to people living in our regions.

Mike began his Australian Public Service career in 1988 as a graduate with the then Department of Transport and Communications. He has

held a number of senior positions across the portfolio and with the Department of the Prime Minister and Cabinet.

Mike chaired the Transport and Infrastructure Senior Officials’ Committee, which is charged with advising and assisting the Council of Australian Governments Transport and Infrastructure Council.

Mike was also a Commissioner of the National Transport Commission and the Australian Government’s representative on the board of the Foundation for Rural and Regional Renewal.

Internally, Mike chaired the Secretary’s Business Meeting, the Executive Management Team and the Senior Executive Service Management Team, which plays a pivotal leadership role in the Department.

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Mike was appointed an Officer of the Order of Australia in the Queen’s Birthday 2016 honours list for his distinguished service to public administration through executive roles in the infrastructure, transport and logistics sector, and through the development of policy reform initiatives.

In November 2016, Mike was awarded the Public Service Excellence Award from the University of Canberra’s Institute of Governance and Policy Analysis, for his outstanding contribution to the public service.

Judith Zielke PSM: Deputy SecretaryJudith Zielke commenced as Deputy Secretary in February 2016 and oversaw the Infrastructure Investment, Policy and Research and Surface Transport Policy divisions. Her responsibilities included infrastructure investment, strategic policy, national maritime, rail and heavy vehicle regulation, and regional development policy and programs.

Judith was also Chief Coordinator of the Joint Agency Coordination Centre, which was established by the Prime Minister in March 2014 to coordinate the Australian Government’s support for the search into missing flight MH370.

Judith has had a lengthy public sector career encompassing a range of policy advice and implementation positions in the Australian Government in the areas of Trade, Attorney-General’s, Industry and Innovation and, most recently, Infrastructure.

Judith was also a Member of the Board of the Australian New Car Assessment Program (ANCAP). Internally, Judith chaired the Strategic Information Technology and Security Committee. She was also the Department’s Indigenous champion.

Pip Spence: Acting Deputy SecretaryPip Spence commenced as Acting Deputy Secretary in October 2016. Pip’s responsibilities included the Office of Transport Security, Aviation and Airports, Local Government and Territories divisions, the Western Sydney Unit and the Inland Rail Unit.

Prior to acting as Deputy Secretary, Pip was Executive Director of the Aviation and Airports Division.

Pip was the Department’s disability and gender equality champion.

Shane Carmody: Deputy Secretary (April to October 2016)

In his role as Deputy Secretary, Shane Carmody was responsible for delivering the transport security, air transport and services to territories programs.

Shane was the Department’s representative on the board of the Australian Maritime Safety Authority. He was also the Department’s disability champion.


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The portfolioThis report focuses on the Department of Infrastructure and Regional Development. Information on our portfolio entities can be obtained from their annual reports and websites.

The entities in the portfolio at 30 June 2017 were:

• Airservices Australia <www.airservicesaustralia.com>;• Australian Maritime Safety Authority <www.amsa.gov.au>;• Australian Transport Safety Bureau <www.atsb.gov.au>;• Civil Aviation Safety Authority <www.casa.gov.au>;• Infrastructure Australia <www.infrastructureaustralia.gov.au>;• National Capital Authority <www.nationalcapital.gov.au>; and• National Transport Commission <www.ntc.gov.au>.The Commonwealth companies in the portfolio at 30 June 2017 were:

• Australian Rail Track Corporation Limited<www.artc.com.au>; and• Moorebank Intermodal Company Limited <www.micl.com.au>.Seven portfolio entities, including the Department, belong to the general government sector. Table 2.3 provides the purposes of each entity.

Table 2.3 Information on portfolio entities in the General Government Sector at 30 June 2017

Senator the Hon Fiona Nash, Minister for Regional Development, Minister for Local Government and Territories

The Hon Darren Chester MP, Minister for Infrastructure and Transport

The Hon Paul Fletcher MP, Minister for Urban InfrastructureDepartment of Infrastructure and Regional Development

Secretary Mike Mrdak AOPurposes Promote, plan, evaluate and invest in infrastructure and regional

development;Foster an efficient, sustainable, competitive, safe and secure transport system;Strengthen the sustainability, capacity and diversity of regional economies and support local communities; andProvide good governance in the Australian territories.

continued...

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Australian Maritime Safety AuthorityChair Stuart Richey AM

Chief Executive Officer Michael KinleyPurposes Vision: Safe and clean seas, saving lives.

Mission: Ensuring safe vessel operations, combatting marine pollution, and rescuing people in distress.Roles:• promote maritime safety and protection of the marine

environment;• prevent and combat ship-sourced pollution in the marine

environment;• provide infrastructure to support safe navigation in

australian waters;• provide, on request, services to the maritime industry on a

commercial basis;• provide, on request, services of a maritime nature on a

commercial basis to the Commonwealth and/or states and territories; and

• provide a national search and rescue service to the maritime and aviation sectors.

Australian Transport Safety BureauChief Commissioner Greg Hood

Purpose Improve the safety of, and public confidence in, aviation, marine and rail transport through:• the independent investigation of transport accidents and

other safety occurrences; and• safety data recording, analysis and research fostering safety

awareness, knowledge and action.continued...


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Civil Aviation Safety AuthorityChair Jeffrey Boyd

Chief Executive Officer and Director of Aviation Safety

Shane Carmody

Purposes The Civil Aviation Safety Authority (CASA) is Australia’s aviation safety regulator and is a corporate Commonwealth entity under the PGPA Act and was established on 6 July 1995 under the Civil Aviation Act 1988. The main object of the Civil Aviation Act is to establish a regulatory framework for maintaining, enhancing and promoting the safety of civil aviation, with particular emphasis on preventing aviation accidents and incidents.CASA’s key role is to conduct the safety regulation of civil air operations in Australian territory and the operation of Australian aircraft outside Australian territory. CASA is also responsible for ensuring that Australian-administered airspace is administered and used safely.CASA, the Australian Transport Safety Bureau, the Department of Infrastructure and Regional Development, Airservices Australia and the Department of Defence constitute Australia’s aviation safety framework, each with separate and distinct functions, but working together as an integrated system.In keeping with CASA’s fundamental obligations, efforts are maintained and promoted at all times to ensure our decision-making and actions are lawful, fair, reasonable and consistent, and in all cases contribute to optimal safety outcomes, while not unnecessarily impeding the efficient operation of entities that we regulate.

Infrastructure AustraliaChair The Hon Mark Birrell

Chief Executive Officer Philip DaviesPurposes Infrastructure Australia provides independent research and high

quality advice to all levels of government, as well as investors and owners of infrastructure, on Australia’s requirements for nationally significant infrastructure.Infrastructure Australia provides advice and advocates for reforms on key issues including financing, delivering and operating infrastructure as well as the identification and promotion of best practice planning and utilisation of Australia’s infrastructure networks.

continued...

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National Capital Authority Chair Terry Weber

Chief Executive Officer Malcolm SnowPurposes To fulfil the National Capital Authority’s statutory functions and

purposes and better inform and educate the community about the importance of Canberra as the National Capital.To facilitate the proper management and enhancement of National Land.

National Transport CommissionChair David Anderson PSM

Chief Executive Officer and Commissioner

Paul Retter AM

Purposes Develop and propose changes to national law, model law and other related instruments and guidelines to improve transport productivity, efficiency, safety, environmental performance and regulatory efficiency.Maintain and monitor those reforms agreed by the Transport and Infrastructure Council.

3ACTIVITIES


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Part 3: Activities

Infrastructure InvestmentIn 2016–17, the Australian Government invested over $6.3 billion in projects designed to improve the performance of Australia’s land transport network. These funds were paid through the Infrastructure Investment program to state, territory and local governments, and the Australian Rail Track Corporation (ARTC), for the planning and delivery of road and rail projects.

The Department also:

• progressed the development of urban rail plans for Australia’s five largest cities and surrounding regions;

• advised the Australian Government on potential projects for future funding under the Infrastructure Investment Program;

• examined opportunities for alternative funding and financing approaches for infrastructure and, with the state and territory governments, developed options to support longer-term institutional and governance reform of land transport market investment and charging arrangements;

• provided policy advice on the development of future concessional loans for infrastructure projects; and

• undertook cost estimate, assurance and compliance reviews to help ensure investment in infrastructure is achieving policy objectives and projects are delivered efficiently and effectively.

Information about the infrastructure investment funds administered by the Department is available at <www.investment.infrastructure.gov.au>.

WestConnex Stage 2 – provision of a concessional loanThe Department is managing a $2.0 billion concessional loan for WestConnex. The first drawdown was made against the loan in 2016–17, with total drawdowns during the year totalling $111.9 million.

Direction-setting and collaborationIn November 2016, the Australian Government released its response to Infrastructure Australia’s Australian Infrastructure Plan. In the response, the Government committed to five key initiatives, including the development of urban rail plans. In addition, the Using Value Capture to Help Deliver Major Land Transport Infrastructure – Roles for the Australian Government discussion paper was released.

Did you know?With 874,500 kilometres of road, Australia has one of the world’s most extensive road networks by per capita length. Around 85 per cent of Australia’s road network is non-urban.

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Throughout 2016–17, the Department collaborated with relevant portfolio agencies to ensure appropriate consideration of infrastructure priorities during the implementation of broader Australian Government policy initiatives.

InvestmentA total of $5.2 billion was provided towards road and rail projects. Key projects progressed and provided during 2016–17 included:

• Inland Rail ($73.2 million); • Western Sydney Infrastructure Plan (WSIP) ($266.0 million);• NorthConnex ($66.0 million);• WestConnex ($300.0 million);• Pacific Highway ($1.3 billion);• Toowoomba Second Range Crossing ($493.4 million);• M80 ($32.5 million);• Bruce Highway ($458.6 million);• NorthLink WA ($136.7 million);• Midland Highway ($59.7 million); and• North-South Road Corridor in Adelaide ($483.0 million).

Black Spot ProgramThe Department administered $125.0 million supporting projects to improve road safety at identified crash sites around Australia. The program has reduced the risk of crashes at these locations through measures such as traffic lights, roundabouts, signage and edge sealing. During the year, 217 Black Spot projects were completed and 302 were underway.

Bridges Renewal Program A total of $53.0 million was provided to upgrade and repair bridges to enhance access and safety. During the year, 62 Bridges Renewal projects were completed and 60 were underway.

Heavy Vehicle Safety and Productivity ProgramA total of $36.6 million was provided to improve productivity and reduce the number of road accidents involving heavy vehicles. During the year, 22 Heavy Vehicle Safety and Productivity projects were completed and 33 were underway.

Roads to Recovery$815.4 million was provided to 523 funding recipients, mainly councils, to support maintenance of the nation’s local road infrastructure asset and to facilitate improved safety, economic and social outcomes. During the year, 3,122 Roads to Recovery projects were completed and 2,889 were underway.


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Northern Australia Beef Roads ProgramFunding is yet to commence for targeted upgrades to key cattle roads, to improve the reliability, productivity and resilience of cattle supply chains in northern Australia. During the year, planning for the delivery of six Beef Roads projects commenced.

Northern Australia Roads ProgramA total of $12.0 million was provided to enable upgrades to high priority roads in northern Australia, to support the region’s economic development. During the year, four Northern Australia Roads projects were underway.

Infrastructure Growth Package A total of $616.5 million was provided through the Infrastructure Growth Package administered item for additional Black Spot funding, the National Highway Upgrade Program, additional funding for major projects such as the Toowoomba Second Range Crossing, the North South Corridor in Adelaide and the WSIP.

• New Investments: Under the New Investments component of the Infrastructure Growth Package, the Australian Government provided $350.5 million in additional funding to expedite investment in high quality economic infrastructure. This included additional funding for significant road projects, the National Highway Upgrade Program and Black Spot projects.

• WSIP: The WSIP provides $2.9 billion over 10 years to enhance capacity and improve transport infrastructure in Sydney’s western suburbs, including development of an airport at Badgerys Creek. In 2016–17, $266.0 million was provided under the plan.

Victorian Infrastructure PackageIn 2016–17, the Department settled funding arrangements for the Australian Government’s $1.5 billion commitment, with the following projects and programs to be supported:

• $500.0 million to upgrade the Monash Freeway;• $350.0 million to complete the upgrade of the M80 Ring Road (in addition to existing

$150.0 million joint commitment on M80);• $220.0 million to upgrade 1,000 kilometres of freight rail in the Murray Basin;• $345.0 million towards a Rural and Regional Roads Package (which includes a new

bridge across the Murray River at Echuca-Moama); and• $85.0 million towards an Urban Congestion Package, including construction of the

O’Herns Road interchange on the Hume Freeway in Epping.The Victorian Government is providing matching funding towards the agreed commitments.

Plan for the Future—Building Australia FundIn 2016–17, the Government took the decision to fund the Goodwood and Torrens Junctions rail project in SA under the National Land Transport Act 2014 rather than the Building Australia Fund, which will close in 2017–18.

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The Government has also been advised by the WA Government that the remaining Building Australia Fund project, Oakajee Port Common User Services, will not proceed and the committed equity contribution is no longer required.

Neither of these projects received funding in 2016–17.

Highlight: Progressing Inland RailThe Melbourne to Brisbane Inland Rail project progressed significantly in 2016–17. Our key milestones were met and are set out below.

• September 2016: The private sector was invited to register its interest in the design, construction, delivery and financing of the project.

• December 2016: Bruce Wilson AM was appointed to the role of Queensland Community Adviser and Chair of the Yelarbon to Gowrie Project Reference Group. Consultation through the Project Reference Group throughout 2016–17 provided valuable local community input on the Inland Rail alignment.

• May 2017: The Australian Government committed an additional $8.4 billion in equity for the delivery of Inland Rail.

The Department worked closely with the ARTC to deliver each of these milestones and move this transformational project forward.

Highlight: Black Spot ProgramThe Black Spot Program is a crucial part of the Australian Government’s commitment to reduce crashes on our roads. The program, which provides funding for measures such as traffic signals and roundabouts at dangerous locations, has been running continuously in all states and territories since 1996. Since then more than 8,100 sites across the nation have been approved for funding, including 554 in 2016–17.

One Black Spot project funded in 2016–17 was a roundabout at the Woodward Street and Moulder Street intersection in Orange, NSW. The intersection was nominated for funding because of its crash history—congestion was a known issue at the site during peak times, sometimes-triggering risky motorist behaviour.

Works involved building a two-lane roundabout, including line markings, and installing lighting and signage. The $635,000 project, which was completed in June 2017, was fully funded by the Australian Government and delivered by Orange City Council.

Anyone can nominate a site for Black Spot funding. Further information is available at <investment.infrastructure.gov.au/funding/blackspots/>.


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Transport SecurityIn 2016–17, the Department continued to ensure Australia’s transport systems remain effective in the face of an ever-changing security environment. This was done through compliance, review, implementation and engagement activities. The overarching consideration in undertaking this work was ensuring regulatory regimes are based on risk and threat—upholding security while minimising administrative burden on industry.

ComplianceIn 2016–17, the Department launched a new compliance program to focus more on high risks.

The Department completed 787 compliance activities, of which 567 focused on aviation industry participants and 155 on maritime industry participants (the remainder related to issuing bodies and supply chain industry participants). The activities included 176 audits, 302 inspections and 309 system tests.

A total of 13 last port of call (LPOC) aviation security assessments were conducted and information gathered about the quality of airport and airline security arrangements at key overseas airports with direct flights to Australia.

The Department also initiated 331 formal entry and exit interviews with industry participants to discuss findings in relation to compliance activity outcomes and the detail of any areas of noncompliance.

Regulatory review and implementationIn 2016–17, regulatory amendments were made to:

• strengthen the security of airside screening arrangements and commence implementation;

• streamline transport security programs, improve signage requirements and the application of special event zones;

• introduce a role‑specific aviation and maritime security identification card (ASIC and MSIC) for certain critical transport security roles;

• introduce national security assessments for ASIC and MSIC applicants under the age of 18;

• improve ASIC and MSIC issuing practices and the verification of the applicant’s identity; and

• improve the administration of the visitor identification card and temporary aircrew card schemes for airport operators and approved national passenger airlines.

The Department implemented new regulatory arrangements for regulated air cargo agents and accredited air cargo agents and established a Known Consignor scheme. Together, these arrangements support more stringent piece-level screening security requirements for air cargo exports to the United States (US), which came into effect on 1 July 2017. The Department has approved a range of businesses as Known Consignors as they were able to demonstrate they can secure cargo along their supply chain to the aircraft. In addition,

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10 businesses operating at 38 sites have been approved to examine US-bound air cargo at piece-level in accordance with Enhanced Air Cargo Examination (EACE) notices.

The Department implemented reviews to improve the effectiveness of the LPOC program and the Department’s transport security Capacity Building Program overseas.

In response to terror attacks at Brussels and Istanbul airports, the Department conducted a review of the security of public areas at airports (landside). The review ensured that security arrangements were effective and has led to the development of new industry guidance on protecting crowded places in landside areas.

EngagementEngagement activities during 2016–17 included:

• undertaking awareness raising activities to ensure industry participants remain aware of current security threats and understand relevant reforms to regulatory operations, including holding meetings of the Aviation Security Advisory Forum, the Regional Industry Consultative Forum, the Maritime Industry Security Consultative Forum and the Oil and Gas Security Forum to consult with industry participants;

• establishing a dedicated guidance centre to provide industry with nationally consistent information on their transport security regulatory requirements;

• working with the maritime and aviation industries to progress the response to recommendations made by the Inspector of Transport Security;

• engaging both major and regional airports and airlines to finalise contingency planning;• engaging around 10,000 businesses and other industry stakeholders to support

implementation of more stringent piece-level examination requirements for US-bound air cargo;

• working with US Transport Security Administration (TSA) officials to ensure Australia’s new regulatory regime for US-bound air cargo was commensurate with their requirements;

• engaging overseas governments bilaterally and via the International Civil Aviation Organization (ICAO), Asia‑Pacific Economic Cooperation and QUAD (a strategic partnership between Australia, Canada, the European Commission and the US);

• hosting information forums (in collaboration with the Attorney-General’s Department) to prepare consultation with ASIC and MSIC issuing bodies for significant regulatory changes;

• conducting identity verification training to assist ASIC and MSIC issuing bodies and their representatives to meet new regulatory requirements starting on 1 August 2017; and

• redeveloping and re-launching the TravelSECURE website to improve traveller access to relevant and reliable information about aviation security screening at airports.


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Aviation Security Enhancements—Improving International Aviation SecurityUnder the Aviation Security Enhancements—Improving International Aviation Security administered item, the Department used funding of $22,000 to deliver capacity-building activities for transport security personnel in the Philippines. The activities focused on the improvement of quality control processes, and the development and implementation of corrective action plans.

Aviation Security Enhancements—Regional and Remote Airports Security AwarenessUnder the Aviation Security Enhancements—Regional and Remote Airports Security Awareness administered item, the Department used funding of $128,000 to develop and deliver a security awareness training package to 158 regional and remote airports. This package supports industry by providing a practical resource to build and maintain security awareness among workers.

Highlight: Guidance centre established for industryThe Department established a dedicated guidance centre to respond to enquiries from industry on their transport security regulatory requirements. The centre’s purpose is to help industry improve the quality of their transport security regulatory submissions and to assist industry to better meet their regulatory requirements.

The centre provides nationally consistent information over the phone or email and through improved guidance materials published on the Department’s website. The centre actively engages with industry when there are regulatory changes that affect their security operations, to ensure they have the most up-to-date advice on regulatory requirements.

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Part 3: Activities

Highlight: Changes to US-bound air cargo screening requirementsMore stringent screening requirements for US-bound air cargo came into effect on 1 July 2017. These arrangements are imposed on airlines by the US Government and require that all air cargo being transported to the US either be examined at piece-level (box, carton, pallet or another deconsolidated form of cargo), or originate from a Known Consignor.

The Australian Government has put in place a robust regulatory and compliance regime that is commensurate with these requirements while taking into account the unique characteristics of Australia’s trade and transport systems. The new regulatory regime is the culmination of ongoing engagement between the Department and US TSA officials over a number of years.

The Department worked closely with Australian industry to ensure it was well positioned for the more stringent screening requirements through the introduction of both the EACE Notice and the Known Consignor scheme.

The EACE Notice provides for approved examination methods, techniques and equipment requirements for examination of US-bound air cargo at piece-level by both on and off-airport Regulated Air Cargo Agents.

The Known Consignor scheme, which came into effect on 1 November 2016, provides an alternative to piece-level examination for businesses that can demonstrate they maintain a robust security process throughout their supply chain, from product source to aircraft. The scheme is an important option for businesses that cannot otherwise have their cargo screened at piece-level because it is either too big or not able to be screened by approved technology such as X-ray. Many perishable foods and pharmaceuticals cannot be deconsolidated because it will break US Food and Drug Administration temperature controls, or X-rayed because water content is too high.

There has been a significant effort to engage with a broad range of businesses and stakeholders to ensure they are aware of the US requirements and that they comply from 1 July 2017. This engagement has included sending 8,000 letters to key industry participants, as well as thousands of emails and phone calls.


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Surface TransportIn 2016–17, the Department continued its integrated approach to surface transport, balancing the outcomes of productivity, efficiency and safety across road, rail and shipping.

Road and rail

Land transport market reformThe Department continued to work closely with state and territory government agencies to progress heavy vehicle road reform, in line with the road map agreed by the Transport and Infrastructure Council in May 2015. This included:

• publishing the second editions of the heavy vehicle asset registers and expenditure plans following feedback from industry and state and territory governments;

• identifying options for an independent price regulator for heavy vehicle charges by 2017–18;

• investigating a forward-looking cost base for roads;• working towards an agreement between the Australian Government and state and

territory governments on a range of heavy vehicle user charging trials; and• releasing the Land Transport Market Reform independent price regulation of heavy

vehicle charges discussion paper to seek views from stakeholders on establishing independent price regulation for heavy vehicle charges.

The Department also continued to work with state and territory agencies to investigate the potential benefits and costs of extending road user charging to light vehicles. An annual progress report on this task was provided to the Council of Australian Governments out-of-session in the second half of 2016–17.

Freight and supply chain strategyIn November 2016, the Australian Government announced it would develop a national freight and supply chain strategy to increase the productivity and efficiency of Australia’s freight supply chain. The strategy is in response to Infrastructure Australia’s Australian Infrastructure Plan.

In March 2017, the Hon Darren Chester MP, Minister for Infrastructure and Transport, released Terms of Reference for an Inquiry into National Freight and Supply Chain Priorities. The inquiry will inform the development of the strategy and determine how to best lift the productivity and efficiency of Australia’s freight supply chain. The Department is leading the inquiry, assisted by Infrastructure Australia and a four member Expert Panel appointed by Minister Chester. In May 2017, the Department released the Inquiry into National Freight and Supply Chain Priorities discussion paper, marking the commencement of the public consultation period.

Did you know?Australia has one of the largest rail systems in the world with 33,000 kilometres of heavy rail and 291 kilometres of light rail.

Did you know?On an average day, rail moves 32 per cent of the 9 million tonnes of freight transported across Australia.

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Federal Interstate Registration Scheme (Interstate Road Transport Account)The Australian Government continued to administer approximately 14,300 vehicles under the Federal Interstate Registration Scheme. In 2016–17, state and territory governments collected $67.6 million in heavy vehicle registration charges on behalf of the Australian Government. All revenue collected from the scheme is paid to the Australian Government for redistribution to states and territories for road maintenance.

Setting national priorities for implementing new transport technologiesOver the last year, the Department has been working with states, territories and transport bodies to progress projects under the National Policy Framework for Land Transport Technology agreed by the Transport and Infrastructure Council in 2016.

Building on this work, the Department has also played a significant role in helping inform the House of Representatives Standing Committee on Industry, Innovation, Science and Resources, which is conducting an inquiry into social issues relating to road and rail driverless vehicles in Australia. In addition, the Department released a brochure, Preparing Australia for Automated Vehicles, to inform the community of work underway by governments in this area.

Organisation for Economic Co-operation and Development (OECD) Road Transport ContributionThe OCED International Transport Forum (ITF) organises longer-term research projects with oversight from the transport ministries and research agencies of member countries through the Transport Research Committee. The Department administered an annual contribution of $45,720 to the OECD for transport research activities of the ITF. Membership enables the Australian Government to influence the ITF’s forward research work program and promote successful Australian transport policy initiatives. This can be either through direct participation of Australian transport experts in ITF-sponsored projects, or representation of Australian senior executives at OECD/ITF events.

National Heavy Vehicle Regulator’s Heavy Vehicle Safety InitiativeIn 2016–17, the Department administered payments of $3.9 million to the National Heavy Vehicle Regulator for projects delivered through the Heavy Vehicle Safety Initiative.

Did you know?Over three quarters of Australia’s non-bulk freight is transported on roads.


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Maritime and shipping

Domestic commercial vessel safety reformsThe Department worked to progress the Council of Australian Governments National Seamless Economy reforms agreed in 2009 for domestic commercial vessels through the Maritime Senior Officials Group, the Transport and Infrastructure Senior Officials’ Committee, and the Transport and Infrastructure Council. Following public consultation on the proposed changes, the assumption of full responsibility for service delivery and cost recovery by the National Maritime Safety Regulator (NMSR) was delayed by the Transport and Infrastructure Council until 1 July 2018. However, the Department ensured the Marine Safety (Domestic Commercial Vessel) National Law Amendment (Cost Recovery) Regulation 2016 commenced in September 2016, which allows fees to be charged for some services delivered by the NMSR under the national system.

Coastal shipping reformTo progress coastal shipping reform, the Hon Darren Chester MP, Minister for Infrastructure and Transport, released a Coastal Shipping Reforms discussion paper for public consultation in March 2017. Submissions were encouraged from stakeholders including ship owners and operators, employee and employer representatives, users of shipping services, industry associations, maritime unions, government entities and interested members of the public. The Department reviewed and analysed the submissions, providing advice on policy options for progressing the reforms to coastal trading. It is expected legislative reforms will be introduced in the second half of 2017.

Bass Strait Passenger Vehicle Equalisation Scheme and Tasmanian Freight Equalisation SchemeDuring 2016–17, approximately $47.8 million was provided to help reduce the cost of travel across Bass Strait for passengers accompanying an eligible vehicle. Additionally, $137.6 million was provided to eligible shippers under the Tasmanian Freight Equalisation Scheme; a financial assistance scheme to shippers of eligible non‑bulk goods for costs incurred moving goods by sea between Tasmania and mainland Australia.

Part X of the Competition and Consumer Act 2010—registrar of liner shippingPart X of the Competition and Consumer Act enables liner shipping operators to enter into collaborative agreements to supply joint or coordinated shipping services to Australian exporters and importers by giving such agreements limited exemption from the anti-competitive conduct provisions of the Act. Under the agreements, operators can fix routes, capacity, sailing schedules and prices, share operational functions and/or exchange commercial information, providing the conditions specified in Part X of the Act are fulfilled. The Registrar of Liner Shipping, who is appointed by the Minister for Infrastructure and Transport, administers Part X of the Act within the Department.

Did you know?Over 80 per cent of world trade by volume is transported by sea. Australia relies on sea transport for 99 per cent of its international trade (by volume).

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During 2016–17, a total of 58 provisional registrations and 55 final registrations for international joint shipping agreements were approved under Part X. All shipping agreements were registered within legislated timeframes.

Tax incentivesThe Shipping Reform (Tax Incentives) Act 2012 provides a mechanism for the shipping industry to obtain a certificate as an initial step in gaining access to a range of taxation concessions. This encourages ship ownership and ship operations in Australia as well as encourage the employment of Australian seafarers.

The Act provides for certificates to be granted after the end of a financial year to applicants who meet requirements of the regime. For companies applying for these concessions for the first time, the scheme gives them the opportunity to obtain a ‘notice’ during the first year of entry. This provides applicants a degree of comfort that the arrangements they propose will likely meet the requirements of the Act, reducing the pressure on them when compiling their tax returns.

During 2016–17, the Department approved two applications for a tax notice and 14 applications for a tax certificate.

International Maritime Organization (IMO)The Department worked to implement the International Code for Ships Operating in Polar Waters (Polar Code) into domestic law. The Polar Code, entered into force internationally on 1 January 2017, specifies operational and structural measures for ships to improve maritime safety and minimise environmental risks in polar environments. These measures encompass design, construction, equipment and operational matters, as well as training, search and rescue, and environmental discharges.

The Department engaged in the work of the IMO by attending the Facilitation Committee and IMO Council meetings. The Department worked with other agencies to implement domestically the requirements of the Convention on the Facilitation of International Maritime Traffic, reducing the administrative burdens imposed on ships entering Australian ports.

Responding to community concerns, the Department worked with the Australian Maritime Safety Authority to issue a direction to cruise ships at berth in Sydney Harbour to burn low-sulphur content fuel.

The Australian Government contributed $277,000 to the IMO in 2016–17 to support a viable global maritime sector.

Did you know?There are 24 ports in Australia with an annual throughput of over $1.0 billion. By tonnage, Port Hedland is Australia’s largest port and the fifth largest port in the world.

Australian imports mostly come through capital city container ports. Port of Melbourne is the largest in Australia and handles more than 1.5 million containers a year. It is 59th in the world’s container ports rankings, on annual throughput terms, with Port Botany in Sydney 69th.


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Protection of the Sea (Oil Pollution Compensation Funds) Act 1993Compensation for pollution damage caused by spills from oil tankers is governed by an international regime established under the auspices of the IMO. The International Oil Pollution Compensations Funds (IOPC Funds) provide financial compensation for oil pollution damage resulting from spills of persistent oil from tankers. The IOPC Funds are financed by contributions levied on member countries, based on the volume of particular types of oil being imported and the proportionate scale of certain oil pollution events occurring. IMO collects contributions to the IOPC Funds retrospectively at the same time each year. For 2016–17, the Department administered payments of $394,000 collected from Australian oil companies under the Protection of the Sea (Oil Pollution Compensation Funds) Act for the purposes of the scheme.

Highlight: Better disability access for public transport networks—The Whole JourneyRecommendation four of the second review of the Disability Standards for Accessible Public Transport proposed the development of accessibility guidelines for a whole-of-journey approach to public transport as a planning tool.

In response, the Department released for comment a consultation draft of The Whole Journey: A guide for thinking beyond compliance to create accessible public transport journeys. Released in March 2017, the guide was prepared to encourage policy makers, planners, designers, builders, certifiers and operators to think beyond compliance and the physical and governance boundaries of services and infrastructure, and to focus instead on people’s accessibility needs across their whole journey.

Road SafetyThe Department worked to ensure the safety of Australian vehicles and to foster national road safety frameworks, which also facilitate productivity.

National Road Safety Strategy 2011–2020The Department continued to coordinate delivery arrangements for the National Road Safety Strategy 2011–2020 and National Road Safety Action Plan 2015–17, including road safety data collection and progress reporting, supporting continuous improvement of the national road safety system.

Did you know?Driving remains by far the preferred transport means for travel within Australian cities and for trips of up to 400 kilometres.

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Vehicle systems

Reform of the Motor Vehicle Standards Act 1989To progress reforms to the Motor Vehicle Standards Act, the Department began the process to draft legislation for introduction to Parliament. The Department also conducted consultations in September and October 2016 on the proposed thresholds for the specialist and enthusiast vehicle criteria, and continued to consult on elements of the broader reforms during 2017. In May 2017, the Department released a consultation paper concerning proposed use of the Register of Approved Vehicles (RAV), an online database for vehicles approved for use on Australian roads and an information paper on proposed reforms to light trailer regulation. Development of the RAV commenced in January 2017 and it is anticipated that the project will be complete by the end of 2017.

Standards developmentIn 2016–17, the Department participated in the development of international vehicle standards, including revisions to braking and seatbelt requirements. A major focus was the revision of the primary multilateral treaty for standards development2 in order to better facilitate the approval of vehicles on an international basis, known as International Whole Vehicle Type Approval. Australia has adopted the revised treaty and, in common with other countries, is now actively re-aligning its domestic standards to suit. Work on better alignment of national standards to international standards was also undertaken for buses and general vehicle lighting requirements. Consistent with international timetables and the National Road Safety Action Plan 2015–17, progress was also made on the assessment of international standards for stability control for heavy vehicles and advanced braking systems for motorcycles.

Approvals, licensing and complianceTo maintain a safe environment for road users and the community, every vehicle new to Australia must meet minimum safety standards. To enable safe vehicle imports, the Department issued approvals and licences under the Commonwealth road and vehicle safety regulatory frameworks in 2016–17, including 2,661 vehicle certification approvals and amendments, 7,483 Registered Automotive Workshop Scheme (RAWS) import approvals and 6,733 RAWS used import plate approvals. By the end of 2016–17, 90 RAWS audits had been conducted identifying a number of workshops that had breached approval conditions and supplied non-compliant and unsafe vehicles to the market.

The Department received 8,088 non-RAWS related vehicle import applications—an average of 674 a month.

2 Agreement concerning the Adoption of Harmonized Technical United Nations Regulations for Wheeled Vehicles, Equipment and Parts which can be Fitted and/or be Used on Wheeled Vehicles and the Conditions for Reciprocal Recognition of Approvals Granted on the Basis of these United Nations Regulations.

Did you know?Light passenger vehicles account for approximately 75 per cent of vehicles on Australian roads.


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A risk based audit and enforcement program included 56 audits of vehicle production and test facilities. Audits are effective in identifying unsatisfactory manufacturing practices to ensure that non-compliant vehicles are not supplied to the market.

Vehicle emissionsThe Department continued to support the Ministerial Forum on Vehicle Emissions to pursue options to reduce vehicle emissions. In December 2016, the Ministerial Forum released for public consultation, three draft proposals to reduce vehicle emissions and improve fuel quality. Two of these proposals, developed by the Department, are:

• a Regulation Impact Statement proposing to increase the stringency of noxious emissions standards, in line with international standards (the Euro 6 standards for light vehicles and Euro VI standards for heavy vehicles); and

• a Regulation Impact Statement proposing to introduce new fuel efficiency standards for new light passenger and commercial vehicles.

The third proposal is a discussion paper on improving fuel quality standards, which is being progressed by the Department of the Environment and Energy. The Australian Government is expected to take a decision on these proposals in 2017–18.

keys2driveThe Department continued to manage the delivery of the keys2drive learner driver program, which has provided more than 260,000 learners and their supervising drivers (mainly parents) with free professional coaching lessons and resources. Funding administered in 2016–17 under the program totalled $4.0 million.

Highlight: Developing options for safer motorcycle ridingIn May 2017, the Department published for public comment an Early Assessment Regulation Impact Statement on Advanced Motorcycle Braking Systems for Safer Riding. There is strong evidence that advanced motorcycle braking systems are among the most effective options available to manufacturers for improving motorcycle safety. Research shows these systems are up to 31 per cent effective at reducing traumacausing crashes.

The document outlines a proposal to improve the safety of motorcycle riders by increasing the use of advanced braking systems, including anti-lock braking systems and combined braking systems.

The Regulation Impact Statement is available at <www.infrastructure.gov.au/roads/motor/design/files/Consultation_RIS-Advanced_Motorcycle_Braking_Systems_for_Safer_Riding.pdf>.

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Air TransportThe Department administered policies and programs for aviation and airports to support viable, safe and accessible domestic and international aviation industries.

Airports

Western Sydney AirportIn 2016–17, the Department continued to progress the Australian Government’s decision that Western Sydney’s new airport will be the Commonwealth-owned site at Badgerys Creek.

In December 2016, the Australian Government issued a Notice of Intention to the owners of Sydney (Kingsford Smith) Airport, Sydney Airport Group, setting out the contractual terms for developing and operating the Western Sydney Airport. Under the 2002 Share Sale agreement, Sydney Airport Group had the right of first refusal for the opportunity to build and operate the new airport. Sydney Airport Group announced their decision to decline the opportunity to build and operate Western Sydney Airport in May 2017. Following this decision, the Australian Government announced it would deliver the airport through a new Government-owned company, WSA Co., and also announced equity funding of up to $5.3 billion in the 2017–18 federal budget to build the airport.

Work underway on the airport site in 2016–17 focused on preparing the site for construction, including clearing some structures and closing minor roads. The Department also began engaging TransGrid, the manager and operator of the NSW transmission network, on the detailed plans for relocating high-voltage power lines that cross the airport site.

Melbourne Airport third runwayIn its 2013 master plan, Melbourne Airport proposed a new parallel east-west runway and extension to the existing east-west runway to cater for future passenger growth expected to double to 64.0 million passengers per year by 2033. In 2016–17, the Department worked to facilitate the Melbourne Airport third runway project through coordination activities supporting the ‘Runway Development Program’, provision of $5.4 million through the Melbourne Airport New Runway Land Acquisition administered item, associated infrastructure developments and flight path planning.

Hobart International Airport runway extensionIn 2014, the Australian Government committed $38.0 million to Hobart Airport to extend the runway by up to 500 metres. The runway extension is part of a package of assistance by the Australian Government to support Tasmania’s economy. It will enable the airport to:

• seek direct international flights from key markets in Asia;• develop a strong proposal to attract international Antarctic aviation programs; and• provide a long‑term strategic infrastructure benefit for Tasmania, improving its

connectivity with the rest of the world.

Did you know?In May 2017 there were 5 million passengers carried on Australian domestic commercial aviation (including charter operations), an increase of 1.8 per cent on May 2016.


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In 2016–17, the Australian Government provided $22.0 million towards the runway extension and a new access road, Grueber Avenue. Construction work to the northern end of the runway extension is complete and work on the southern end extension is well underway. Grueber Avenue was opened in 2016–17, providing easier and more direct access for people dropping off and picking up visitors and for users of the long-term car park. Completion for the runway extension project is expected in March 2018.

Airport lessee companies—reimbursement of parking finesPartial reimbursement of parking fines to airport lessee companies under the Parking Infringement Notices Scheme was undertaken, in accordance with relevant legislation and contractual arrangements. In 2016–17, $947,000 was paid through the scheme.

Airport lease review meetingsThe Department conducted annual lease review meetings with 21 federally leased airports to ensure lease term compliance. These were conducted in May, June and July 2017.

Airport insurance reviewsThrough airport leases and sale agreements, airport lessee companies have obligations to the Australian Government to maintain insurance. To establish more effective and appropriate insurance arrangements, the Department appointed an insurance consultant to advise on requirements for the sale agreements and levels of cover held by lessees.

The insurance consultant developed 2016–17 airport insurance review reports for each of the 21 federally leased airports and these reports will be settled early in 2017–18.

Master plans and major development plans under assessmentAll leased federal airports must have a master plan approved by the Minister for Infrastructure and Transport for a 20-year strategic vision for the airport site including future land uses, types of permitted development, and noise and environmental impacts.

Major development plans are required for major developments at leased federal airports and are prepared by lessee companies. In 2016–17, the Department provided assessments on the master plan for Townsville Airport, which was subsequently approved. The Department also assessed for Perth Airport:

• one major development plan including the Direct Factory Outlet development;• one minor variation to a previously approved major development plan; and• one minor variation to a master plan.

Did you know?Domestic and international air travel is expected to grow strongly to 2030. Out of Australia’s major airports, Townsville is expected to experience the largest growth (122 per cent), followed by Canberra (111 per cent) and Darwin (102 per cent).

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Domestic aviation

Modernisation of airspace protection In December 2016, the Department released the Modernising Airspace Protection public consultation paper outlining plans to modernise federal airspace protection arrangements. The paper covered three major proposals relating to:

• modernising airspace protection under the Airports Act 1996;

• protecting the national communications, navigation and surveillance network; and• mitigating risks to low flying aircraft flying beyond aerodromes.

The Department received 46 submissions in response to the paper, which are being considered in the preparation of advice to the Minister for Infrastructure and Transport in 2017–18. This will determine next steps in progressing future agreed proposals in consultation with government, industry and community stakeholders.

Regional aviation accessIn 2016–17, the Department continued to administer programs to reduce the cost of airlines providing regular public services to designated remote communities. Under the Regional Aviation Access program, $23.6 million was dedicated to fund various components, including the:

• Remote Air Services Subsidy Scheme, providing payments totalling $14.4 million to subsidise regular public transport services to 266 designated remote communities; and

• Remote Airstrip Upgrade, providing assistance totalling $9.2 million for 72 projects to improve safety and access at remote airstrips.

The Department also provided rebates of $1.5 million to eligible commercial airlines providing services to regional areas under the Airservices Australia’s en route charges payment scheme.

General Aviation Advisory Group and aviation studyIn February 2017, the Hon Darren Chester MP, Minister for Infrastructure and Transport announced the formation of a new General Aviation (GA) Advisory Group to improve consultation with the sector. The group met in March and June 2017 and details of its operations are available at <www.infrastructure.gov.au/aviation/general/index.aspx>.

The GA Advisory Group is also acting as a reference group for the study being conducted by the Bureau of Infrastructure, Transport and Regional Economics (BITRE). The study is examining the current state of the GA sector in Australia and will identify the challenges and potential opportunities, with findings expected to be released in the second half of 2017.

Did you know?For distances greater than 400 kilometres, flying remains the preferred means of domestic travel for Australians.


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International aviationAt 30 June 2017, Australia had air services arrangements in place with 103 economies. The Department progresses new arrangements and continues to liberalise existing arrangements to ensure Australian consumers and businesses have access to competitive international air services. In 2016–17, the Department negotiated new and updated air services arrangements with a number of economies, including China, Fiji and Italy.

In 2016–17, the Department also:

• led preparations for the October 2016 ICAO Assembly in Montreal, including the campaign for Australia’s successful re-election to Part One of the ICAO Council;

• administered the payment of $2.1 million to ICAO as Australia’s annual contribution to its operations;

• supported improved aviation safety capacity in Indonesia through implementation of the Indonesia Transport Safety and Assistance Package, and in Papua New Guinea though a Memorandum of Understanding and the placement of technical advisers in the country; and

• provided governance support to the Pacific Aviation Safety Office.

Highlight: ‘Open-skies’ between Australia and China In December 2016, the Australian Government and Chinese Government settled arrangements for a landmark ‘open-skies’ style arrangement between Australia and China.

The new arrangements remove all capacity restrictions between all points in Australia and China for airlines of both sides. It also provides for open code sharing arrangements and significantly liberalises traffic rights, which will enable Australian and Chinese airlines to serve almost all destinations between and beyond both countries.

The Department has worked towards this agreement for a number of years. It will provide significant growth opportunities for Australia’s aviation, tourism and trade industries in the Chinese market.

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Highlight: Progress of Western Sydney AirportIn May 2017, Sydney Airport Group declined the opportunity under its right of first refusal to build and operate the Western Sydney Airport. Following this decision, Prime Minister the Hon Malcolm Turnbull MP and the Hon Paul Fletcher MP, Minister for Urban Infrastructure, announced the Australian Government would build the Western Sydney Airport and allocated up to $5.3 billion in the 2017–18 federal budget.

The announcement is a significant milestone for the Western Sydney Airport project, coming nearly 40 years after Badgerys Creek was first identified as a potential site. It represents a major step forward, following three years of work by the Department on planning and preparing the business case, Environmental Impact Statement, Airport Plan, consultation with Sydney Airport, and the Notice of Intention.

To progress the Western Sydney Airport further, the Department facilitated the Forum on Western Sydney Airport (FOWSA). This met for the first time in May 2017 and is a critical community consultation mechanism on issues such as economic opportunity and flight path planning. Professor Peter Shergold AC has been appointed as the forum’s chairperson. Further information on FOWSA is available at <www.westernsydneyairport.gov.au/forum>.


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Regional DevelopmentThe Department administered dedicated funding and undertook forward planning to deliver vital infrastructure to regions now, and assure regional development into the future. These activities were done in partnership with communities and state, territory and local governments.

Progress in Australian Regions—YearbookAfter a major review of the 2016 edition of Progress in Australian Regions—Yearbook, the Department has received strong support across government agencies for continued production and enhancement of this statistical resource. As a result, a 2017 edition, to be published in December 2017, will provide a major update from the 2016 Census and new indicators on housing affordability, numeracy levels for school students, and labour underemployment rates (where available for larger regions). The Progress in Australian Regions series aims to help all Australians understand how their region is progressing against economic, social, environmental and governance indicators, and provide consistent measures of progress in Australia’s regions over time.

Direction-setting and collaborationThe Australian Government released Regions 2030—Unlocking Opportunity in May 2017. The document outlines the Government’s investments, achievements and future direction for rural, regional and remote Australia across five key areas: jobs and economic development, infrastructure, health, education, and communications.

Throughout 2016–17, the Department collaborated with relevant portfolio agencies to ensure consideration of impacts on Australia’s regions to enhance regional economic and social outcomes in areas such as health, communications, education, environment and industry.

Did you know?In 2016, Australia’s agriculture, forestry and fishing and mining industries made up 57 per cent of the value of national merchandise exports and 10 per cent of Australia’s gross value.

Did you know?Nearly 8 million Australians live outside capital cities and approximately 1.9 million Australians live in cities with between 25,000 and 100,000 residents.

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Funding programsIn 2016–17, the Department administered regional development funding through several funding programs, with a summary of activities included below. Further information about the regional development funds administered by the Department is available at <www.investment.infrastructure.gov.au>.

• Building Better Regions Fund: The Department established the Building Better Regions Fund, including preparing program guidelines and calling for applications to Round One of the fund. Nearly $500.0 million in Australian Government funding will be available through the program to support infrastructure and community investment projects that are creating jobs, driving economic growth and building stronger communities in regional and remote Australia, outside the major capital cities of Sydney, Melbourne, Brisbane, Perth, Adelaide and Canberra.

• Community Development Grants Programme: $66.0 million was paid towards 142 projects to support needed infrastructure that promotes stable, secure and viable local and regional economies.

• Drought Communities Programme: $7.3 million was provided in 2016–17 for projects within 23 local councils to benefit targeted drought affected regions of Australia.

• National Stronger Regions Fund: $124.8 million was announced under Round Three for 65 infrastructure projects which are delivering economic benefits and addressing disadvantage. A total of $110.7 million was paid towards 107 projects in 2016–17 across all three rounds of the fund. The fund is now closed and its outcomes will in future be supported through the Building Better Regions Fund.

• Regional Australia Institute: $1.8 million was provided to support the work of the institute, an independent research organisation focused on national regional issues.

• Regional Development Australia Committees: $18.1 million was provided to support the operation of 55 Regional Development Australia (RDA) Committees. RDA Committees are made up of local leaders who: ▪ consult and engage with communities; ▪ promote and participate in regional programs and initiatives; ▪ provide information and advice on their region to all levels of government; and ▪ support informed regional planning.

In 2016–17, the Department coordinated an independent review of the RDA Committee program to examine its effectiveness in delivering the Australian Government’s regional agenda. The review was conducted by the Hon Warwick L Smith AM and is being considered by the Australian Government.

• Regional Development Australia Fund: $19.1 million was paid to 21 capital infrastructure projects identified as priorities by local communities. The fund is now closed and its outcomes will in future be supported through the Building Better Regions Fund.


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• Regional Jobs and Investment Package: Applications to access funding totalling $135.0 million across six regions opened in May 2017. It is anticipated that successful projects will be announced in late 2017. Applications to access funding totalling $85.0 million across the remaining four regions are expected to open in 2017–18.

• Stronger Communities Programme: Round Two of the program saw 1,571 grants of between $5,000 and $20,000, totalling $18.3 million, awarded to community organisations and local governments for small capital projects. Up to $150,000 was available in each federal electorate in 2016–17. The Australian Government announced a further $22.5 million for a third round of the Stronger Communities Programme in 2017–18.

• Tasmanian Jobs and Growth Package: $13.8 million was provided in 2016–17 to 10 projects that support the economic development of Tasmania. Other departments are delivering additional projects through the package.

Highlight: Community house for the disabled realised through Community Development Grants ProgrammeThe Lions McDonald Hill House located in South Bendigo, Victoria, was opened in October 2016 as a dedicated facility to support people with disability and their carers throughout the region. The facility is expected to benefit up to 150 individuals in need of respite each year and reduce the financial pressures families face when caring for a person with disability.

The Department administered $300,000 towards construction of the facility under the Community Development Grants Programme, assisting the South Bendigo community to realise the project they worked for a decade to build.

Did you know?Despite only 34 per cent of all tourism businesses being located outside of the capital cities, 45 cents in every tourism dollar is spent in regional Australia.

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Local GovernmentThe Department supported local communities through provision of financial assistance to local governments, supporting effective planning and coordination across all levels of government on matters affecting local government, and engaging with all levels of government to pursue issues of particular relevance to local government.

In 2016–17, the Australian Government provided $3.5 billion through the Local Government Financial Assistance Grants program to support local government service delivery and infrastructure.

The Department also conducted the annual National Awards for Local Government to promote innovation and leading practice service delivery by local government and sponsoring departments. The awards showcase the activities carried out by the local government sector and celebrate the exceptional local government projects that are making a difference to local communities.

Highlight: National Awards for Local Government 2017The National Awards for Local Government, administered by the Department, recognise local government projects that are innovative, deliver better outcomes for communities, have the potential to be rolled out across the country and make a meaningful difference to local residents. On 1 May 2017, Senator the Hon Fiona Nash, Minister for Regional Development, Minister for Local Government and Territories, announced the 2017 National Awards for Local Government category winners. The full list of category winners and highly commended projects is available at <www.infrastructure.gov.au/nalg>.

In June 2017, Wyndham City Council was announced as the winner of the 2017 National Award for Excellence in Local Government for its initiative WynLens – Visualization, Analysis and Modelling of a Holographic City. The Wyndham City Council collaborated with universities and private sector to improve its local community’s understanding of planning and development proposals using technology. WynLens is a game changer, it enhances community engagement and improves planning outcomes by allowing individuals to visualise their local surroundings using interactive 3D and immersive landscapes.

Did you know?The Australian Government has provided over $49.0 billion under the Financial Assistance Grant program to support local government since 1974–75.

Wyndham City Council receiving their award from Minister Fiona Nash


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Services to TerritoriesThe Department continued its work to improve the quality of services and infrastructure to residents of Norfolk Island, Christmas Island, the Cocos (Keeling) Islands, and Jervis Bay Territory. It also continued to administer the external territories of Ashmore and Cartier Islands and the Coral Sea Islands and manage the Australian Government’s interests in the NT and ACT.

External territories and Jervis Bay TerritoryIn 2016–17, the Department ensured services and essential infrastructure in the external territories and Jervis Bay Territory met community needs. It has also progressed work to ensure citizens within these territories can access comparable levels of services and are supported by comparable legal rights and protections to that of similar communities.

Norfolk IslandFrom 1 July 2016, mainland taxation, social security, immigration, biosecurity, customs and health arrangements, including Medicare and the Pharmaceutical Benefits Scheme, were extended to Norfolk Island. The Department has worked to implement these changes and continues to inform the community of service delivery arrangements in place to support residents.

New management arrangements were introduced for the Kingston and Arthur’s Vale Heritage Area (KAVHA) site, a World Heritage Australian convict site on Norfolk Island. The Department also provided funding of $0.6 million for KAVHA site management works. These initiatives complement the significant investment being made at Cascade Pier, which is undergoing an extension and refurbishment upgrade.

In 2016–17, the Australian Government also provided:

• $26.2 million Norfolk Island operational expenses (Services to Norfolk Island administered item); and

• $1.1 million for the Office of the Norfolk Island Administrator, which includes maintenance of Government House.

Indian Ocean TerritoriesThe Department continued to ensure administrative and contractual arrangements are in place to support the delivery of services to the Indian Ocean Territories. In 2016–17, there were 42 WA Government agencies providing services to the Indian Ocean Territories, as well as services being delivered directly by the Department’s local administration staff and through contractual arrangements with private sector entities, local governments and other organisations.

Did you know?Norfolk Island is located in the Pacific Ocean about 1,600 kilometres north‑east of Sydney. At the 2016 Census, Norfolk Island’s total population (excluding visitors or tourists) was 1,748.

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In 2016–17, the Department provided $115.3 million for operational expenses for the Indian Ocean Territories and $1.2 million to Parks Australia from the Christmas Island Phosphate Mining Rehabilitation Special Account to restore rainforest on relinquished mine sites.

Jervis Bay TerritoryUnder the Services to Jervis Bay Territory administered item, the Department provided $6.2 million towards provision of a range of essential state and local government services to the Jervis Bay Territory, including electricity, water, health, education, and housing.

NT and ACTActivities to support the NT and ACT in 2016–17 included:

• administering $0.4 million for the Office of the NT Administrator;

• administering the concessional interest rate loan to the ACT Government to implement its Loose Fill Asbestos Insulation Eradication Scheme. In 2016–17, the ACT Government made a $27.1 million interest payment for the $1.0 billion loan; and

• providing $1.8 million to the ACT Government for the provision of services to fulfil diplomatic, treaty and other obligations as a result of the establishment of the National Capital on behalf of the Australian Government.

Highlight: Christmas Island land planChristmas Island is a unique place, rich in historical and natural attractions. To support the local community’s access to land and engender economic development on the island, the Department released the Christmas Island Crown Land Management Plan in March 2017.

The plan was developed by the Department and involved consultation with the Shire of Christmas Island, local businesses, members of the community and other government agencies. It sets out objectives to support the release of Crown land (owned by the Australian Government) for residential, tourism, commercial and agricultural development. Following the plan’s release, potential investors were given the opportunity to register their interest in parcels of land, which the Government will consider for lease or sale.

The Christmas Island Crown Land Management Plan is available at <www.regional.gov.au/territories/christmas>.

Did you know?Christmas Island is located in the Indian Ocean 380 kilometres south of Java and 2,650 kilometres north‑west of Perth. At the 2016 Census, Christmas Island’s total population (excluding visitors or tourists) was 1,843.

Did you know?At the 2016 Census, ACT’s total population (excluding visitors or tourists) was 396,857 and NT’s was 228,833.


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Highlight: Norfolk Island reformsAt 30 June 2017, there were 227 residents receiving Age Pension, 117 recipients of Family Tax Benefit and 50 recipients of other disability, youth, income support or parenting payments.

The 2015–16 monthly average before the reforms commenced was 509 visits to a General Practitioner; after the reforms commenced, the 2016–17 average jumped to 821 visits a month.

Since 1 July 2016, the Australian Government has invested over $2.0 million to upgrade the health service building on Norfolk Island.

$1.4 million has been spent on new technology medical equipment.

Since 1 July 2016, the school received $3.4 million in capital upgrades, mainly focused on repairs to school buildings and overdue maintenance.

A new satellite dish will provide improved systems access to the NSW Department of Education for delivery of additional aspects of the NSW curriculum.

The Banyan Park Early Learning Centre will receive $899,900 over two years from the Building Better Regions Fund—it is now well placed to become an approved child care centre, allowing eligible families to access the Government’s fee relief payments.

The Government continues to underwrite air services between Norfolk Island and the mainland (Brisbane and Sydney) to provide a regular and reliable link for residents and tourists.

The Government has matched the $100,000 funding commitment by the Norfolk Island Regional Council for the promotion in New Zealand of Norfolk Island as a tourist destination.

4MANAGEMENT AND

ACCOUNTABILITY


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Part 4: Management and accountability

Corporate governanceThe Corporate Services Division enables the Department and its business divisions to deliver activities that achieve our purposes. It does this by providing high quality and contemporary business services, systems, support and advice to the Executive and business divisions.

Through its professional teams, the Division is responsible for providing a broad range of corporate services, including financial management, workforce management and planning, information and communication technology, ministerial and parliamentary services, legal services, property and office services management, governance, business planning, reporting, audits, risk management and evaluation, and communication services.

Governance frameworkThe Department’s governance framework promotes the principles of good governance, applied in ways that encourage all employees to be accountable for their actions; to focus on high standards of performance; strive for excellence; and ensure the efficient, effective and ethical management of resources. The governance framework includes committees focused on particular areas of organisational management; business planning and reporting activities; performance management; management of risk; audit and evaluation activities; and activities which promote awareness of ethical standards.

High-level groupsThree high-level departmental groups meet regularly and assist the Secretary and senior management in decision-making. They are the Secretary’s Business Meeting, Executive Management Team and Senior Executive Service Management Team.

The most senior is the Secretary’s Business Meeting, comprising the Secretary, deputy secretaries and Chief Operating Officer. It meets weekly to consider departmental business priorities, ministerial and parliamentary business, corporate policy, departmental resourcing and operational matters, including risk management.

The Executive Management Team, which also meets weekly, is the main executive communication and coordination forum. The team consists of the Secretary, deputy secretaries, the Chief Operating Officer and executive directors (heads of the Department’s divisions). Other employees, including the Chief Financial Officer, General Counsel, Chief Information Officer and general managers within the Corporate Services Division, attend meetings in an advisory capacity.

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ent and accountability

The Executive Management Team:

• is briefed by executive directors on emerging issues for each division;• considers strategic policy proposals and updates on issues such as financial and

human resource management; and• enables the Secretary to communicate key messages about departmental

performance, areas for improvement and emerging priorities.

Senior Executive Service Management Team meetings are held as required. Departmental employees and external speakers may be invited to give presentations on key issues. The Senior Executive Service Management Team meetings:

• promote closer links and engagement among the senior executive service;• encourage participation by senior executive service employees in organisational

management discussions;• provide feedback to the Executive on key management issues; and• update senior executive service employees on important government and

operational matters.

Specific organisational management committeesThe Audit Committee provides independent assurance and assistance to the Secretary and the Executive Management Team on the Department’s risk, control and compliance frameworks and external accountability responsibilities.

In accordance with its charter, the Audit Committee:

• monitors and oversees the Department’s risk management framework;• reviews the appropriateness of the Department’s systems and procedures for

assessing and reporting the Department’s performance;• considers and endorses the internal audit work program and monitors its

implementation;• assesses whether management has taken steps to embed a culture that promotes

the proper use and management of public resources and is committed to ethical and lawful conduct;

• provides a forum for the Department and the Australian National Audit Office to exchange views on external audit findings and associated recommendations; and

• oversees preparation of the Department’s financial statements in conjunction with the Financial Statements Sub-Committee.

To meet the requirements of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) the Audit Committee meets at least four times a year. Membership consists of two Department officials and three independent members. Geoff Knuckey is the independent Chair of the Audit Committee. The Secretary, Chief Operating Officer, Chief Information and Security Officer, Chief Financial Officer, Internal Audit Manager, internal audit providers, representatives from other areas of the Department and the Australian National Audit Office attend meetings as advisers/observers.


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The following four committees focus on specific areas of organisational management and decision-making:

• Finance, Reporting and Program Committee;• Strategic Information Technology and Security Committee;• Departmental Consultative Committee; and• Work Health and Safety Committee.

Finance, Reporting and Program CommitteeThe Finance, Reporting and Program Committee:

• oversees the Department’s budget process and considers the Department’s monthly financial reports;

• recommends budget priorities to the Secretary;• oversees the development of the Department’s Annual Report;• oversees the strategic management and delivery of the Department’s administered

programs;• considers the Department’s monthly human resources and workforce reports, and

oversees the Workforce Plan;• considers and recommends to the Secretary non-IT capital investment proposals; and• provides a forum for finance, reporting and program management (including

evaluation) issues to be raised and discussed.This committee meets monthly and consists of the Secretary, deputy secretaries, Chief Operating Officer, Chief Financial Officer, the General Manager of the People and Performance Branch and the Deputy Chief Financial Officer.

Strategic Information Technology and Security CommitteeThe Strategic Information Technology and Security Committee:

• develops a common vision for the Department’s information technology, information governance and security requirements;

• oversees the Department’s data requirements and determines data collection priorities;

• ensures the Department’s information is managed for its entire life in accordance with risk, including risks associated with security, access, privacy, continuity and cost;

• recommends information technology, information governance and security funding priorities to the Secretary;

• recommends appropriate information and protective security policies to the Secretary;• oversees internal information reviews to identify information assets and their value,

manages risk and compliance, and improves business processes;• provides a forum for information technology, information governance and security

issues to be raised and discussed; and• makes decisions informed by the portfolio risk assessment.

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The committee meets quarterly and comprises a Deputy Secretary, Chief Operating Officer, Chief Information Officer, Chief Financial Officer and the executive directors of the Infrastructure Investment, Policy and Research and Office of Transport Security divisions.

Departmental Consultative CommitteeThe Departmental Consultative Committee:

• provides a forum to discuss and consult on general employment matters;• consults on matters relevant to the operation and implementation of the Department of

Infrastructure and Regional Development Enterprise Agreement 2016;• consults on the impact of any legislative change affecting employment conditions;• consults on Machinery of Government changes; and• provides a forum for employee representatives to raise any workplace issues.

This committee meets quarterly and comprises of the Chief Operating Officer, an Executive Director nominated by the Secretary, the General Manager of the People and Performance Branch, an employee representative from each Division, and an employee representative from a regional office. A representative of the Community and Public Sector Union (CPSU) and a CPSU employee delegate are also invited to attend each meeting.

Work Health and Safety CommitteeThe Work Health and Safety Committee:

• facilitates consultation and cooperation between the Department and workers in instigating, developing and carrying out measures designed to ensure workers’ health and safety at work;

• helps develop standards, rules and procedures relating to health and safety that are to be followed or complied with at the workplace; and

• undertakes any other functions agreed between the Department and the Committee.

The committee meets quarterly and comprises a Departmental General Manager, a representative each from the Work Health and Safety, Internal Communications, and Property Portfolio and Office Services Management teams, and Health and Safety Representatives from designated Work Groups.

Planning and reporting frameworkThe Department’s 2016–17 Portfolio Budget Statements:

• described the outcomes, programs and administered items for 2016–17;• detailed objectives of each program;• set financial and other performance targets for each program; and• presented the Department’s budgeted financial statements for 2016–17 and three

forward years.The Portfolio Budget Statements were published in May 2016.

The Department’s 2016–17 Corporate Plan covers a four-year period (2016–17 to 2019–20) and is designed to be the Department’s primary planning document. The


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plan, which is updated annually, includes information about the Department’s purposes, operational environment and strategy, including key priorities and how performance will be measured. It also includes information on capability building and risk management. The plan was first published in August 2016. In March 2017, a revised 2016–17 Corporate Plan was published to incorporate revised, impact-oriented performance measures and targets for 2016–17, re‑setting those that had been published in the first issue. The revised measures were informed by an understanding of what success looks like for the Department’s key stakeholders. The Department will continue to review and refine performance measures over the coming years.

Results against the performance measures set in the revised 2016–17 Corporate Plan are included in the annual performance statements part of this report.

Both the Corporate Plan and the Portfolio Budget Statements inform the strategic business plans for each division. Three times a year, meetings are held between divisional Senior Executive Service (SES) staff and the Executive to determine divisional progress against their business plans. This informs the Executive of achievements and any emerging areas of concern in relation to the delivery of agreed activities and outcomes.

Departmental risk managementThe Department updated its risk framework in 2016–17. The framework is based on four risk categories: program failure; regulatory failure; organisational failure; and policy advice failure. It emphasises that managing risk properly helps develop operational innovation and reduce red tape. The risks are reported to the Department’s Audit Committee, to align with the internal audit work program.

Fraud controlThe Fraud Control Plan was updated in 2016–17 to reflect the findings of the 2016–18 Fraud Risk Assessment and to include amendments, such as clarifying roles and responsibilities in relation to handling allegations of fraud, and updating internal contact details.

Issues of potential fraud were reported to the Audit Committee on a quarterly basis and were managed under section 10 of the Public Governance Performance and Accountability Rule 2014.

Business continuity managementBusiness continuity management is an important part of the Department’s overall approach to effective risk management. The aims of the business continuity response are to:

• ensure the uninterrupted availability of key resources necessary to support critical business functions, so that these can be delivered pre, during and post-event;

• provide a coordinated response to an event so that normal business is resumed in a way that minimises disruption to the Department; and

• ensure the safety and wellbeing of departmental staff.

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Protective securityThe Department continued to monitor risk factors during 2016–17, and changed processes and controls where necessary to meet the expectations of the Executive and Australian Government’s protective security requirements. This process will continue in 2017–18 to ensure compliance and alignment with the Australian Government’s Protective Security Policy Framework and Information Security Manual. The Department’s risk profile remains at a low status.

Internal auditIn 2016–17, the internal audit work program was developed through a risk-based approach and endorsed by the Audit Committee. The Audit Committee reviewed the Department’s performance reporting framework to focus on key strategic performance measures and the net benefits of activity. The Audit Committee considered agency level risk and treatment to provide insight into the Department’s key risks and alignment with the internal audit work program, and is provided with updated risk reports throughout the year.

EvaluationIn June 2017, the Department launched the Monitoring and Evaluation Capability Strategy 2017–20 and the Monitoring and Evaluation Resource Booklet. These publications updated previous versions of the documents to build on existing knowledge, and further embed a culture of reflective and evaluative thinking in the Department. The strategy is designed to align with the PGPA Act in measuring and assessing the Department’s performance and achieving its purposes. The strategy sets out the skills and knowledge that underpin the Department’s overall operational capability, as outlined in the Corporate Plan. The resource booklet provides an overview of key monitoring and evaluation concepts and guidance for staff on practical application.

A total of 10 training courses were held to build skills in developing policy/program/regulatory logics, and monitoring and evaluation, with attendance by 115 staff across the Department. Mentoring was available to help employees develop logics, monitoring, risk and compliance activities for particular areas of work.

Ethical standardsThe Department is committed to maintaining high standards of integrity, good governance and ethics. All employees are required to uphold the Australian Public Service Values, Employment Principles and Code of Conduct.

In 2016–17, a new communication strategy was developed to continue to emphasise our commitment to a high standard of ethical behaviour, and a new online portal was launched drawing attention to resources that assist in recognising and dealing with ethical issues.

In March 2017, the annual completion of declarations of conflicts of interests was conducted for all SES employees. Due to the nature and sensitivity of their work, a number of Executive Level (EL) 2 roles were also specifically identified to complete the declarations. All staff were reminded to consider their personal arrangements and complete a declaration if necessary. A new requirement saw the Department’s key management personnel submit


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a related party disclosure in accordance with Australian Accounting Standard AASB 124 – Related Party Disclosures.

Information Publication SchemeEntities subject to the Freedom of Information Act 1982 are required to publish information to the public as part of the Information Publication Scheme. This requirement in Part II of the Act has replaced the former section 8 requirement to publish a statement in an annual report. The Department’s plan shows the information that is published in accordance with the requirements of the Information Publication Scheme, available at <www.infrastructure.gov.au/department/ips/index.aspx>.

GrantsInformation on grants awarded by the Department from 1 July 2016 to 30 June 2017 is available at <www.infrastructure.gov.au/department/grants/>.

External scrutiny

Decisions by the Office of the Australian Information CommissionerFive freedom of information decisions made by the Department were reviewed by the Office of the Australian Information Commissioner. Two reviews were withdrawn or closed due to inactivity and three reviews remain on hand. No reviews of the Department’s freedom of information decisions were finalised by the Information Commissioner during the reporting period.

Decisions of courts and tribunalsIn 2016–17, the Department was involved in some matters before Australian courts and tribunals. These related to issues such as motor vehicle imports, approval of airport master plans and major development plans, freedom of information, and approval to issue an aviation security identity card to a person with an adverse criminal record. Some matters were ongoing at 30 June 2017.

Legal services expenditureParagraph 11.1(ba) of the Legal Services Directions 2017 requires the entity’s legal services purchasing, including expenditure, to be appropriately recorded and monitored and that, by 30 October each year, the entity makes publicly available records of its legal services expenditure for the previous financial year.

For 2016–17 the Department’s legal expenditure was:

• $11,076,768.88 for total external legal services expenditure; and• $1,294,184.00 for total internal legal services expenditure.

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Australian National Audit Office and parliamentary scrutinyReports on matters relating to the Department are released by the Australian National Audit Office, parliamentary committees and other public bodies.

The Department formally responds to the Australian National Audit Office’s reports in writing, which includes the Department’s responses in its reports, available at <www.anao.gov.au/Publications/Audit‑Reports>.

Details of the reports of parliamentary committee inquiries are available at <www.aph.gov.au>. The Australian Government tables its responses to parliamentary inquiries and other reports in Parliament.

Table 4.1 provides the reports released in 2016–17 relating to the Department, and the dates these were tabled in Parliament.

Table 4.1 Australian National Audit Office, parliamentary committees and Commonwealth Ombudsman reports relating to the Department tabled in Parliament during 2016–17

Inquiry Type Title Tabled

Australian National Audit Office

Performance audit–cross-entity Machinery of Government Changes 31 August 2016

Performance audit Procurement of the International Centre for Complex Project Management to Assist on the OneSKY Australia Program

31 August 2016

Performance audit Passenger Security Screening at Domestic Airports

31 August 2016

Performance audit Design and Implementation of Round Two of the National Stronger Regions Fund

19 December 2016

Performance audit–cross-entity The Approval and Administration of Commonwealth Funding for the WestConnex Project

14 February 2017

Performance audit–cross-entity Conduct of the OneSKY Tender 10 April 2017

Parliamentary committees

Standing Committee on Infrastructure, Transport and Cities (House of Representatives)

Harnessing Value, Delivering Infrastructure: Report on the inquiry into the role of transport connectivity on stimulating development and economic activity

6 December 2016

Senate Standing Committees on Environment and Communications

Continuation of construction of the Perth Freight Link in the face of significant environmental breaches

6 March 2017

Commonwealth Ombudsman

Nil


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SES employees of the Department, in addition to attending specific parliamentary inquiries, also attend Senate Estimates Committee hearings to respond to questions about the Department’s activities.

Table 4.2 provides a summary of the number of parliamentary questions on notice received by the Department in 2016–17.

Table 4.2 Summary of parliamentary questions on notice received in 2016–17

Source of questions Number

House of Representatives 74

Senate 20

Senate Estimates Committee hearings 404

Total 498

Management of human resourcesA highly capable and committed workforce is critical for the Department to provide assurance to stakeholders across government and industry, and to anticipate and adapt to future challenges.

The Workforce Strategy 2016–19, released in 2016–17, strengthens the Department’s ability to do this through workforce goals and actions to better attract, develop and retain a highly capable, inclusive and professional workforce. The strategy identifies strategic workforce priorities over the three years.

Key highlights• Enhanced workforce data metrics and reporting capability were introduced in 2016–17.

A number of new analytical reports on a range of workforce issues, including reports identifying spans of control, diversity and inclusion, rate of internal employee mobility, and employee separation patterns, were developed to better inform workforce decision-making.

• Unscheduled absence rates reduced from 13.9 days per Full Time Equivalent (FTE) in 2015–16 to 12.9 days per FTE in 2016–17. This reduction has been made possible through increased awareness raising, building capability in managing unscheduled absence, and greater clarity in supporting policies and guidelines.

• There was strong employee participation in the 2016 Australian Public Service Employee Census with a 78 per cent response rate. Departmental results compared well to the previous year with the areas of: goal clarity and focus; job skills match; intrinsic rewards; and job security all identified as a Departmental strength. Results for commitment, loyalty and engagement were similar to the results for the broader Australian Public Service.

• EL employees also participated in a Career Development Survey in 2016–17 to identify their key career and capability drivers. Division specific actions are being undertaken as a result of the survey, such as ‘Manager Once Removed’ meetings and regular capability conversations between managers and staff.

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• Greater access to workforce metrics and targeted workforce initiatives have helped improve the Department’s separation rate, which has reduced from 16.4 per cent in 2015–16 to 15.1 per cent in 2016–17.

Diversity and inclusionThe Department strengthened its commitment to recruiting and supporting a workforce inclusive of diversity in 2016–17 with the release of a Gender Equality Action Plan. The plan identifies key actions for driving a supportive and enabling culture, achieving gender equality in Australian Public Service (APS) leadership, innovating to embed gender equality in employment practices, and normalising flexible working arrangements.

The Gender Champion role was broadened in 2016–17 and renamed Champion for Gender Equality. The Champion released a commitment statement, endorsed by the Secretary in early 2017 to reaffirm the Department’s commitment to gender equality.

The Department also released guidelines on domestic and family violence and raised its awareness as a workplace issue by participating in White Ribbon Day.

The Department continued to acknowledge and celebrate days of significance in relation to workforce diversity including:

• National Reconciliation Week;• National Aborigines and Islanders Day Observance Committee (NAIDOC) Week;• International Women’s Day;• International Day of People with Disability; and• Harmony Day.

The Department also continued its membership with the Australian Network on Disability, the Diversity Council of Australia and joined Pride in Diversity.

Recruitment and entry-level programsThe Department took steps to modernise attraction and recruitment practices following a review of the function, laying a path for it to become an employer of choice within the public sector. Approaches piloted so far include the introduction of capabilities as selection criteria and a candidate response limited to one to two pages.

The Department also welcomed 27 new employees as part of the Graduate Development Program. Graduates were involved in a range of broad opportunities available across the Department through rotations and work experience.

Graduates also accessed a range of formal learning and development opportunities, including the Graduate Certificate in Public Administration, enabling public administration capability building and broader opportunities to pursue management in the APS.

The Department’s 2016–17 University Vacation Employment Program also welcomed new participants who experienced Department life while completing university studies.


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The Department also maintained its participation in the Indigenous Australian Government Development Program and Stepping Into… Program as part of its aim to attract and recruit a diverse workforce.

Employment relationsThe Department revised and developed new Employment Procedures to support the implementation and operation of the Department of Infrastructure and Regional Development Enterprise Agreement 2016. Employees were consulted during the development process. The new Employment Procedures provide greater clarity and include case studies to support consistent and practical application in the workplace.

The Department successfully negotiated and implemented a new Enterprise Agreement for the Registered Nurses engaged with the Indian Ocean Territories Administration. It was approved by an all staff ballot in February 2017 and came into effect on 10 April 2017. The new agreement nominally expires on 9 April 2020.

The Department revised its procedures for determining suspected breaches of the APS Code of Conduct and the Suspected Misconduct Guidelines. The Procedures and Guidelines improve the Department’s approach to complex case management and enhance procedural fairness elements.

The Department also released a Psychological Safety Guideline that aims to empower supervisors and employees to work together to build inclusive workplace cultures and effective systems for promoting mental health in the workplace.

Learning and developmentDuring 2016–17, the Department commenced work on a Workforce Capability Framework that identifies both core and professional capabilities and behaviours to support and encourage more targeted learning and development approaches. The capability framework includes four professional capability streams: Strategic Policy, Compliance and Regulation, Project and Program, and Enabling Services.

A new EL Mastery Program was piloted for the Department’s middle managers in 2016–17. The program was designed to strengthen management capability by building practical skills and knowledge to manage and lead staff, including through change.

A comprehensive middle manager online resource was also developed, which provides managers with immediate access to a range of informal learning offerings via the Department’s Learning Management System. The resources includes manager toolkits, reading materials, video tutorials and online learning courses.

In 2016–17, employees engaged in 6,139 learning opportunities, of which 51 per cent were undertaken online. The remainder comprised classroom learning and seminars, delivered within the Department and externally.

A total of 70 staff used the Department’s Study Assistance Scheme to undertake higher education that contributes to their overall public sector professional development.

A total of 32 staff accessed the Department’s Professional Coaching Scheme to support their career and professional development.

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RemunerationRemuneration in the Department is subject to the provisions of the Department’s Enterprise Agreement for non-SES staff, while SES remuneration is provided for by determinations under subsection 24(1) of the Public Service Act 1999. The Enterprise Agreement provided a two per cent increase to base salary and allowances for all non-SES employees on 28 March 2017. SES employees also received an equivalent increase to base salary on the same date.

Non-salary benefitsIn addition to salary, the Department provides its employees with a range of non-salary benefits, including activities targeting health and wellbeing, support for professional and personal development, access to flexible working arrangements and a range of paid leave entitlements.

Performance payThe Department made no performance payments to employees, including SES employees, during the reporting period.

Disability reportingSince 1994, non-corporate entities have reported on their performance as policy adviser, purchaser, employer, regulator and provider under the National Disability Strategy. In 2007–08, reporting on the employer role was transferred to the Australian Public Service Commission’s State of the Service Report and the APS Statistical Bulletin. These reports are available at <www.apsc.gov.au>. From 2010–11, departments and agencies have no longer been required to report on these functions.

The National Disability Strategy has now been replaced by the National Disability Strategy 2010–2020, which sets out a 10-year national policy framework to improve the lives of people with a disability, promote participation and create a more inclusive society. A high-level bi-annual report will track progress against each of the six strategy outcome areas and present a picture of how people with a disability are faring. The first of these progress reports was published in 2014 and are available at <www.dss.gov.au>.


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Human resources statistics

Table 4.3 Workforce location profile, including holders of public office by classification

APS 1–4 and

equivalent

APS 5–6 and

equivalentEL1 and

equivalentEL2 and

equivalent

SES/ Secretary

and equivalent

Holder of Public

Office Total

15–16 16–17 15–16 16–17 15–16 16–17 15–16 16–17 15–16 16–17 15–16 16–17 15–16 16–17

Employees and public office holders

ACT 113 111 374 378 287 291 132 141 43 45 3 3 952 969

NSW 2 2 20 19 6 4 1 3 13 42 28

Vic. 1 19 18 6 3 0 1 26 22

Qld 1 23 22 6 5 1 2 30 30

SA 13 13 4 4 0 17 17

WA 2 3 20 17 11 9 2 2 35 31

Tas. 1 1 1 1 2 2

NT 3 4 1 1 4 5

Overseas 0 4 3 5 6 9 9

Indian Ocean Territories

0 0 1 1 1 1

Pacific Ocean Territories

2 1 2 2 2 1 6 4

Total 118 117 475 473 328 323 144 157 43 45 16 3 1,124 1,118

Table 4.4 Workforce gender profile, including holders of public office

Female Male Total

2015–16 2016–17 2015–16 2016–17 2015–16 2016–17

Holder of public office

3 1 13 2 16 3

Ongoing full-time

457 (9) 464 (9) 529 (8) 512 (12) 986 (17) 976 (21)

Ongoing part-time

90 (1) 96 20 18 110 (1) 114

Non-ongoing full-time

5 12 5 9 10 21

Non-ongoing part-time

1 2 1 2 2 4

Total 556 (10) 575 (9) 568 (8) 543 (12) 1,124 (18) 1,118 (21)

Note: Employees who identified as Aboriginal or Torres Strait Islander peoples are shown in brackets.

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Table 4.5 Salary ranges for departmental employees by classification

30 June 2016 ($) 30 June 2017($)

APS1 43,587–48,010 44,459–48,970

APS2 49,364–54,634 50,351–55,586

Graduate 56,319–56,319 57,445–57,445

APS3 56,319–60,859 57,445–62,028

APS4 62,400–71,520 63,648–72,247

APS5 69,664–75,567* 71,057–77,574*

APS6 77,098–99,067 78,640–98,752*

EL1 99,029–121,458* 101,010–123,548*

EL2 116,829–184,289* 119,166–193,800*

SES1 190,550–258,530 193,800–252,144

SES2 235,000–278,100 246,891–283,662

SES3 337,329–364,241 344,076–344,076

Secretary The Secretary’s remuneration is determined by the Prime Minister after taking into account the recommendations of the Remuneration Tribunal.

Note: * Individual flexibility arrangements, salary maintenance and annualised shift allowance have been reflected in the maximum salary figures above for these classifications.

Table 4.6 Number of employees employed, by type of Employment Agreement at 30 June 2017

Section 24(1) determination under the Public Service Act 1999 Enterprise Agreement Total Employees

SES 42 0 42

Non-SES 0 1,073 (76) 1,073

Note: Employees with Individual Flexibility Arrangements are shown in brackets

Table 4.7 Employee recruitment, retention and separations in 2016–17

Recruitment

Graduates recruited externally 27

Other external recruits 137

Total external recruits 164

Retention

Retention rate (%) 86.3

Separations

Transfers/promotions to another Australian Public Service entity 81

Resignations and retirements 69

Retrenchments 19

Other 2

Total separations 171

Note: Non-ongoing employees are excluded from recruitment numbers and retention and separation data.


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Table 4.8 Workforce diversity at 30 June 2017

Women 574

People from non-English speaking backgrounds 187

People with a disability 41

Aboriginal people and Torres Strait Islander people 21

All employees 1,115

Notes: Includes ongoing and non‑ongoing employees. Excludes Holders of Public Office.Information (except gender data sourced from payroll records) has been sourced from an equity and diversity report where individuals have volunteered to provide their diversity information to the Department.

Assets managementThe Department manages $40.6 million of non‑financial assets comprising leasehold improvements ($19.9 million), computers, furniture and other equipment ($5.8 million) and in‑house developed and purchased software ($11.0 million). The remaining non‑financial assets are for prepayments and lease incentives.

The Department is also responsible for administering $1.0 billion in non‑financial assets on behalf of the Australian Government (recognised in the Administered Schedule of Assets and Liabilities).These assets are mainly used to provide infrastructure and services to the external territories and the Jervis Bay Territory along with land at the site of the Western Sydney Airport. The assets classes comprise land and buildings ($540.1 million), infrastructure, plant and equipment ($355.8 million), assets of heritage and cultural significance ($114.9 million) and intangible assets ($5.1 million).

Major asset transactions during 2016–17 included:

• transfer of land from the Department of Defence as a ‘contribution by owners through equity’ and subsequent lease of the land to the Moorebank Intermodal Company Ltd for development of the Moorebank Intermodal Terminal;

• acquisition of land from the operators of Melbourne Airport for no consideration and subsequent incorporation of the land into the Melbourne Airport lease;

• upgrades to the Cascade Pier, hospital and school on Norfolk Island;• purchases and upgrades of assets in the Indian Ocean Territories; and• independent revaluations of the Departmental property, plant and equipment

(reduction of $1.2 million) and Administered land (increase of $173.6 million) asset classes.

The Department ensures effective management of the assets it manages and administers through:

• annual capital budgets that require proposals for the acquisition or construction of assets to be approved by the Executive;

• consideration of IT related projects through the Department’s Strategic Information Technology and Security Committee;

• Accountable Authority Instructions on asset management issued by the Secretary;• maintenance of Departmental and Administered asset registers supported by annual

stocktake and impairment reviews to verify their accuracy;

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• engagement of external expertise to help manage and maintain infrastructure assets used to provide services to external territories and the Jervis Bay Territory; and

• heritage and conservation plans and arrangements to manage assets of heritage and cultural significance.

5ANNUAL PERFORMANCE

STATEMENTS


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Part 5: Annual performance statements

StatementI, Mike Mrdak AO, the Accountable Authority for the Department of Infrastructure and Regional Development during the 2016–17 reporting period, present the 2016–17 performance statements of the Department, as required under section 39(1)(a) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

In my opinion, these annual performance statements are based on properly maintained records, accurately reflect performance results against departmental purposes and comply with sub-section 39(2) of the PGPA Act.

Mike Mrdak AO

September 2017

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ents

Annual performance statements for 2016–17These annual performance statements report on the Department’s performance in 2016–17.

Performance is assessed against the measures published in the Department’s revised 2016–17 Corporate Plan, which was issued in March 2017.

This revised Corporate Plan replaced the activity-based performance criteria which was published in the 2016–17 Portfolio Budget Statements and the first version of the 2016–17 Corporate Plan, issued in August 2016.

The Department issued the revised Corporate Plan and replaced its performance measures following a review conducted in late 2016 and early 2017 of its performance framework to implement requirements of the Public Governance Performance and Accountability Act 2013 (PGPA Act). Sections 37–39 of the PGPA Act require the Department to measure, assess and report performance in achieving its ‘purposes’, and to focus on effectiveness and impact rather than the activities completed.

The review commenced a process of improvement, and it is expected that the measures and the data supporting them will be subject to increasing sophistication and refinement over the coming years. It is also recognised that appropriately focused performance monitoring and reporting can be used to continuously improve organisational performance.

Table 5.1 provides a traffic‑light summary of the Department’s results for all targets against each performance measure.

Subsequent tables and text provide more detailed performance results for each measure and an analysis of how these results support the assessment of the Department in achieving its purposes. Noting Resource Management Guide No. 135, Annual reports for non‑corporate Commonwealth entities, by the Department of Finance (paragraph 33), descriptions of processes and activities should be avoided in the annual performance statements. As such, complementary information about the activities the Department has completed to deliver its results are described in Part 3 – Activities.


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Table 5.1 Traffic-light summary of results against targets

Measure TargetResult against target

Purpose: Promote, plan, evaluate and invest in infrastructure and regional development

1. Transport networks are more efficient Demonstrated through travel time savings arising through Australian Government funded projects

In progress

2. Annual number of deaths on Australian roads

Trends on track to achieve the target in the National Road Safety Strategy 2011–2020, to reduce road deaths by at least 30 per cent on 2008–10 figures by 2020

Target not met

3. Jobs supported by infrastructure investment

Demonstrated through the delivery of Australian Government funded projects Target met

4. Percentage of major road projects (defined as Australian Government contribution of $100 million or more) funded with a benefit cost ratio above 1.0

100 per cent Target substantially

met

Purpose: Foster an efficient, sustainable, competitive, safe and secure transport system

5. Industry understanding of their regulatory obligations and security risks

Demonstrated through survey of regulated industry participants Target met

6. International standards improve aviation and maritime security in Australia and the region

Demonstrated by shaping issues in the International Civil Aviation Organization (ICAO) and the International Maritime Organization (IMO) and working with regional partners

Target met

7. Percentage of activities completed as set out in the National Compliance Plan (NCP)

100 per centTarget met

8. Total annual freight volume, measured in billion-tonne-kilometres (btkm), by sector:a. coastal tradingb. rail freightc. road freight

Increased compared to previous financial year Target

substantially met

9. Average load per freight vehicle, measured by road freight tonne kilometre per road freight vehicle kilometre

Increasing trendTarget met

10. a. Number of fatalities for maritime freight

Decrease compared to the average over the previous 10-year period

Target substantially

met

b. Number of fatalities for rail freight Decrease compared to the average over the previous 10-year period In progress

c. Number of fatalities for road freight Decrease compared to the average over the previous 10-year period Target met

11. Improved transparency of transport infrastructure standards as evidenced by the proportion of Australia’s roads included in the Transport and Infrastructure Council Asset Register

Increased proportion compared to previous financial year

Target met

continued...

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12. Improved community understanding of road funding issues

Increase demonstrated through community surveys In progress



Target not met

14. Percentage of road vehicle standards harmonised with international standards

Increasing trend Target met

15. Average new light vehicle carbon dioxide (CO2) intensity

Decreasing trend Target met

16. Performance against service standards*, including:a. percentage of new type approval

applications decided on within 32 days

b. percentage of import approval applications decided on within 20 days

c. percentage of used import plate approval applications decided on within five days of the submission of a vehicle inspection certificate

* Service standards refers to the specific standards set by the Department for vehicle imports and certification services.

Greater than 95 per cent


met

17. Level of available aviation capacity at major city airports

Increase compared to previous financial year Target met

18. Level of available capacity in international aviation markets


19. Opportunities available to Australian airlines in international aviation markets


20. Level of aviation services to remote communities

Maintain service levels compared to previous financial year Target met

21. Jobs supported by Western Sydney Airport project

Regulatory settings and investment strategy in place for the Western Sydney Airport projectDemonstrated through the frameworks and strategies in place to capitalise on employment opportunities and through the delivery of the Western Sydney Airport project

Target met

Purpose: Strengthen the sustainability, capacity and diversity of regional economies and support local communities

22. Jobs supported by regional program investments

Demonstrated through the delivery of Australian Government funded projects Target met

continued...


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23. Number of employed persons outside capital cities**Employed persons includes those in all forms of paid employment (full-time, part-time and casual).

Increase compared to previous financial year

Target met

24. Disposable household income for low and middle incomes outside capital cities



met

25. Financial assistance is provided to support equitable levels of services by local government bodies

Financial assistance is provided in accordance with the Local Government (Financial Assistance) Act 1995

Target met

Purpose: Provide good governance in Australian territories

26. Legal frameworks in place in the external territories and the Jervis Bay Territory that provide comparable rights and protections to citizens as the rest of Australia

State level laws are applied and/or updated in each of the external territories and the Jervis Bay Territory as appropriate to reflect comparable arrangement


met

27. State-type services are delivered in the external territories and the Jervis Bay Territory similar to comparable mainland communities

Services are delivered in accordance with Service Delivery Agreements and contracts


met

Performance against purpose 1: Promote, plan, evaluate and invest in infrastructure and regional development

Results against Infrastructure Investment measuresThe Infrastructure Investment program ensures improved infrastructure across Australia by increasing the efficiency and safety of Australia’s land transport infrastructure while strengthening the Australian economy.

To serve this purpose, the Department works closely with state and territory government agencies to improve planning approaches, strengthen investment decision-making, and make the most of shared investments.

Table 5.2 provides the summary results achieved by the Infrastructure Investment program against the performance measures. More detail is included in the analysis of performance results against the purpose.

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Table 5.2 Summary results against Infrastructure Investment measures

Measure Target Result

1. Transport networks are more efficient

Demonstrated through travel time savings arising through Australian Government funded projects

In progress

Infrastructure Investment program expenditure totalled over $6.3 billion in 2016–17. The projects targeted and selected for funding include those which have been assessed to deliver a more efficient transport network.Data indicating the total travel time savings for all Australian Government funded infrastructure projects are currently unavailable. However, as the Department has started to collect these data from state and territory governments, being able to demonstrate that the target has been met is in progress.In the interim, Case Study A on page 78 demonstrates travel time savings arising through an Australian Government funded project.



Target not met

There were 1,239 road deaths in 2016–17*, representing a reduction of 13.1 per cent relative to baseline 2008–10 figures (1,426 road deaths).* 2016–17 road death figure sourced from the Australian Road Deaths Database. The figure is preliminary and subject to revision, and is provided here as a provisional indication of progress.

3. Jobs supported by infrastructure investments

Demonstrated through the delivery of Australian Government funded projects

Target met

Infrastructure Investment program expenditure totalled over $6.3 billion in 2016–17. By implementing infrastructure investment projects, the Australian Government is supporting jobs, most directly in construction and project management.Data indicating the total number of jobs supported across all infrastructure projects are currently unavailable, however the Department has started to collect these data from state and territory governments.Case Study B on page 78 demonstrates the jobs supported through the delivery of a number of Australian Government funded projects, as reported by state and territory governments.

4. Percentage of major road projects (defined as Australian Government contribution of $100 million or more) funded with a benefit cost ratio (BCR) above 1.0

100 per cent Target substantially met

88 per cent of major road projects funded had a BCR above 1.0. This represents 28 of the 32 major road projects under construction and funded during 2016–17.BCRs are a measure of the economic benefits for a project relative to the economic cost. Projects with a BCR above 1.0 have greater benefits than costs. These benefits can include improving road reliability and safety, and reducing travel times.


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Measure 1–Case Study A: Transport networks are more efficientThe Bruce Highway: Cooroy to Curra (Section A) project upgraded approximately 13 kilometres of the Bruce Highway between the Cooroy Southern Interchange and Sankeys Road. The new road provides a four lane divided highway, upgrades to the Cooroy Southern Interchange and a new grade separated interchange north of Cooroy. These upgrades to the road and interchanges allow traffic to flow more efficiently through this increasingly crowded section of the Bruce Highway and separation of traffic increases safety for all road users.

The project commenced major construction in June 2013 and was completed in May 2017. The Australian Government committed up to $245.0 million towards the $490.0 million project. The project created approximately 430 jobs over the life of the project.

The project has reduced travel time from an average of 9.3 minutes along this section of highway to approximately 7.6 minutes. This has resulted in reduced business costs for local freight operators, higher economic productivity and efficiency for local businesses, and greater access for passenger and freight movement along the Bruce Highway and throughout the region. Up to 16,000 vehicles per day use this section of the Bruce Highway.

Measure 3–Case Study B: Jobs supported by infrastructure investmentsThe Werrington Arterial Road was the first major project completed under the $3.6 billion Western Sydney Infrastructure Plan (WSIP). The project involved widening Gipps Street and Kent Road to four lanes between the M4 Motorway and the Great Western Highway, constructing new entry and exit ramps onto the M4, upgrading intersections and building a shared path for cyclists and pedestrians. As at December 2016, more than 80 direct and indirect jobs supported the Werrington Arterial Road project. Overall, the WSIP is expected to support approximately 4,000 direct and indirect jobs over the 10-year lifetime of the plan.

Construction commenced on the Werrington Arterial Road on 9 March 2015 and the upgraded road opened to traffic on 26 May 2017.

The following projects also supported a significant number of jobs:

• Bruce Highway–Townsville Ring Road—Section 4, Queensland—this project, for which the Australian Government provided $160.0 million, was estimated to generate an average of 299 jobs over its lifetime. The project was completed in December 2016.

• Pacific Highway–Woolgoolga to Ballina–Glenugie to Tyndale, NSW—this section of the project, for which the Australian Government is providing 80 per cent of funding, is creating 800 new jobs. Major work on the project started in September 2016.

• Peninsula Developmental Road, Cape York, Queensland—this project, which is part of the Cape York Region Package for which the Australian Government is providing $208.0 million, supported an average 180 direct jobs over the life of the four projects delivered in 2016.

• Northern Connector, Adelaide, SA—this project, for which the Australian Government is contributing $788.0 million, is supporting an average of 480 jobs a year. North Hub is an employment, skills and training centre that helps jobseekers secure work on the project. Northern Connector project works started in October 2016.

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Analysis of performance against purpose—Infrastructure Investment componentPromoting, planning, evaluating and investing in infrastructure and regional development is crucial for improving the performance of the land transport network and building Australia’s productivity and economic growth.

Investing in infrastructure and regional development improves the efficiency of transport networks. Travel time savings are a key indicator of improved transport network efficiency, less congestion and greater safety for road users. In 2016–17, the Department provided funding to upgrade approximately 13 kilometres of the Bruce Highway between Cooroy and Curra, providing a four lane divided highway. The upgrade reduced travel time by almost two minutes for this highway section, reducing business costs for freight operators and improving passenger and freight movement along the highway.

Investing in safer road infrastructure can help reduce road crashes and deaths. Following stronger progress in the early years of the National Road Safety Strategy 2011–2020, the number of deaths in road crashes in 2016–17 represents only modest progress towards the 30 per cent reduction target. The Australian Government is committed to improving road safety and will continue to invest in road safety programs including the Black Spot Program. The Australian Government will also ask an independent reference group to lead an inquiry into the strategy during 2017, looking closely at the evidence and advising what can be done better to prevent road trauma.

Investing in infrastructure and regional development also supports jobs. In 2016–17, the Werrington Arterial Road was completed. This project is the first major road completed under the $3.6 billion WSIP. More than 80 direct and indirect jobs were supported during this project and it is expected that approximately 4,000 direct and indirect jobs will be supported over its life time.

Benefit cost ratios (BCRs) are an indicator for planning, evaluation and investment as they summarise the overall value for money of a project. A result over 1.0 indicates that the economic benefits for the project are greater than the economic costs. In 2016–17, 88 per cent of major road projects funded through the Infrastructure Investment Program, with an Australian Government contribution of over $100.0 million, had a BCR above 1.0.


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Performance against purpose 2: Foster an efficient, sustainable, competitive, safe and secure transport system

Results against Transport Security measuresThe Transport Security program ensures a viable and sustainable transport security system in Australia through regulation designed collaboratively with industry and government agencies.

To serve this purpose, the Department worked closely with industry, government entities, regional partners and as part of International Civil Aviation Organization (ICAO) and International Maritime Organization (IMO).

Table 5.3 provides the summary results achieved by the Transport Security program against the performance measures. More detail is included in the analysis of performance against the purpose.

Table 5.3 Summary results against Transport Security measures


5. Industry understanding of its regulatory obligations and security risks

Demonstrated through survey of regulated industry participants

Target met

Survey results of regulated industry participants were received in July 2016 and found that industry understands its regulatory obligations and the security risks in the transport system.

6. International standards improve aviation and maritime security in Australia and the region

Demonstrated by shaping issues in the ICAO and the IMO and working with regional partners

Target met

The Department hosted and actively participated in the ICAO’s Aviation Security Panel’s Working Group on Guidance Material, which developed international aviation security guidance. In particular, it worked closely with ICAO member states to develop a draft Global Aviation Security Plan, and joined the taskforce advocating for the plan during key ICAO meetings.The Department facilitated capacity building activities in collaboration with Indonesia, Thailand, the Philippines and Papua New Guinea.Details are reported in Case Study C on page 81.There were no significant issues identified in the IMO, which required particular attention.

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7. Percentage of activities completed as set out in the National Compliance Plan (NCP)The NCP comprises the Department’s plan of regulatory compliance activities, prioritising those parts of the transport system which are most at risk. The NCP is launched with industry annually.

100 per cent Target met

100 per cent of activities identified in the NCP were completed. The activities targeted areas that have the greatest impact on security outcomes.The NCP Information for Industry document was released to all industry participants in July 2016.The purpose of the document is to provide regulated industry participants with an overview of the NCP, the identified compliance priorities and what industry participants can expect from the Department through its compliance activities. Through the identification of compliance priorities for 2016–17, the Department aims to encourage industry to proactively review their operations and to promote improved voluntary compliance.

Measure 6–Case Study C: International standards improve aviation and maritime security in Australia and the regionThe Department worked collaboratively with international transport security counterparts and industry partners to enhance the quality and consistency of aviation security screening in Indonesia. This included a benchmarking visit to a leading international airport followed by a practical workshop to refine local policies. In collaboration with industry partners, the Department also provided training and on-the-job mentoring for approximately 100 airport supervisory staff in Indonesia to promote improvements in aviation security screening.

The Department also worked closely with other ICAO member states to develop a draft Global Aviation Security Plan. This provides a global roadmap for countries and the aviation industry to enhance aviation security by outlining internationally agreed actions and targets. The Department developed a series of Australian priorities for the plan through detailed research and analysis, including consultation with international partners and government agencies. Support for these priorities was built by engaging international partners in the development of the plan. Notably, the Department joined the task force developing the plan and advocated for the plan during key ICAO meetings, such as the ICAO Assembly and Aviation Security Panel. Together, these actions ensured the draft plan acknowledges issues relevant to Australia and the broader Asia‑Pacific region and provides a roadmap for all countries to enhance their aviation security standards.

Analysis of performance against purpose—Transport Security componentInternational security incidents highlight that the security environment continues to evolve and risks increase. Enhancements to the 2016–17 NCP, made by the Department’s Transport Security Operations Branch, provided the Department with the flexibility to undertake additional compliance activities in response to emerging risks. The Department carried out 787 compliance activities across all industry segments, targeting areas that would have the greatest impact on security outcomes. For the first time, the Department advised industry of its key compliance priorities for the year ahead to encourage participants to focus resources in key areas and improve voluntary compliance. The introduction of


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short term, targeted activities or ‘campaigns’ improved the Department’s understanding of current threats and risk and helped to educate industry about its obligations.

To foster a secure transport system it is vital that industry understands its regulatory obligations and security risks. The Department undertook significant consultation with industry in 2016–17, including hosting industry forums, attending teleconferences and providing comprehensive information through newsletters, factsheets, posters, online content, mail-outs and published communications materials. It also convened working groups on particular elements of policy (air cargo, airside regulation, aviation and maritime security identification card (ASIC and MSIC) requirements) and operational change (systems testing).

To assist ASIC and MSIC issuing bodies to comply with the new identity verification obligations (starting 1 August 2017), the Department published a comprehensive guidance document on how to assess the accuracy of identification documents commonly used by applicants. The Department hosted 18 identity‑verification training sessions for over 250 issuing body staff. An online version of the training session was also released to provide ongoing support.

To foster transport security the Department also worked as part of international forums to develop improved aviation and maritime security in Australia and the region. The Department hosted and actively participated in ICAO’s Aviation Security Panel’s Working Group on Guidance Material, which developed international aviation security guidance for ICAO members to implement aviation security standards and recommended practices. It also contributed to shaping the development of ICAO’s Global Aviation Security Plan to provide a global roadmap for countries and industry to enhance aviation security by outlining internationally agreed actions and targets. The Department continued to engage bilaterally and multilaterally with international partners, including Canada, New Zealand, the United States and the United Kingdom to raise the global standard of aviation security. The Department also continued to work with partners in the region to strengthen aviation security by facilitating capacity building activities. Activities were undertaken in collaboration with counterparts in Indonesia, Thailand, the Philippines and Papua New Guinea. The Department, through the Office of Transport Security, contributed to whole-of-government representation at the IMO Maritime Safety Committee.

Results against Surface Transport measuresThe Surface Transport program undertakes activities to improve the performance of the surface transport sector (maritime, road and rail) for the benefit of all Australians.

To serve this purpose, domestically, the Department worked closely with each tier of government including the national regulators, transport engineers and manufacturers, freight industry participants and unions. Internationally, the Department worked as part of forums including the ICAO and the IMO.

Table 5.4 provides the summary results achieved by the Surface Transport program against the performance measures. More detail is included in the analysis of performance against the purpose.

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Table 5.4 Summary results against Surface Transport measures


8. Total annual freight volume, measured in billion-tonne-kilometres (btkm), by sector:a. coastal tradingb. rail freightc. road freight

Increased compared to previous financial year

Target substantially met

The most recent data available are for 2014–15.From 2013–14 to 2014–15, total annual domestic freight volume increased from 679.1 btkm to 719.1 btkm:a. coastal trading volume decreased from

105.4 btkm to 105.2 btkm;b. rail freight volume increased from 367.7 btkm to

401.6 btkm; andc. road freight volume increased from 205.7 btkm

to 212.0 btkm.These trends indicate the 2016–17 target is likely to have been met.

9. Average load per freight vehicle, measured by road freight tonne kilometre per road freight vehicle kilometre


The most recent data available are for 2014–15.From 2013–14 to 2014–15:• average loads for articulate trucks increased

from 20.54 tonnes per vehicle to 20.60 tonnes per vehicle; and

• average loads for rigid trucks increased from 3.73 tonnes per vehicle to 3.78 tonnes per vehicle

10. a. Number of fatalities for maritime freight



Data on a 10-year period are not currently available.In terms of enabling a comparison, data are available for the 2016 calendar year, as well as for the previous six years (that is, from 2010).In 2016, three maritime freight fatalities were recorded.This is a decrease compared to the average of the previous six-year period, 2010 to 2015, which was four.

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b. Number of fatalities for rail freight


In progress

Data for rail freight fatalities are not currently available.Total rail fatalities data (including freight and non-freight) can give an indication of progress against this measure, and safety in the transport system.The Rail Safety National Law (2012) requires that fatalities be notified to the Office of the National Rail Safety Regulator.The most recent available data from the Regulator are for 2015–16.However, in 2015–16, Queensland was not signed up to this national law. In 2015–16, there were 83 notified rail fatalities on railways that the Rail Safety National Law regulates:• 71 acts of suspected suicide;• 11 struck by train; and• a single slip, trip or fall.Queensland joined the national law on 1 July 2017. As such, a baseline for a nationwide trend can be established for rail fatalities from 2017–18.

c. Number of fatalities for road freight


Target met

The most recent data available are for the 2016 calendar year.In 2016, 187 road freight fatalities were recorded due to crashes involving heavy trucks.This is a decrease compared to the previous 10-year average, 2005 to 2015, of 221 fatalities.

11. Improved transparency of transport infrastructure standards, as evidenced by the proportion of Australia’s roads included in the Transport and Infrastructure Council Asset Register

Increased proportion compared to previous financial year

Target met

The Transport and Infrastructure Council Asset Register Maps released in February 2017 cover approximately eight per cent of Australia’s total road network, up from approximately four per cent in the February 2016 release.

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12. Improved community understanding of road funding issues

Increase demonstrated through community surveys

In progress

In 2016–17, the Department worked to establish baseline information regarding the level of community awareness and understanding of current road funding arrangements. This baseline will be used to inform the Department’s community engagement activities on road funding reform as well as to measure, compare and analyse the Department’s community engagement activities in the coming years against future survey results.The baseline research indicated that 80 per cent of respondents had very little awareness of how roads are funded . This information has informed the Department’s approaches to communication with road users in 2016–17 on potential road funding reform options, to improve their understanding of road funding issues. Activities included Ministers and Senior Executives publicly explaining current arrangements for road related revenue and investment, inherent issues with those charges across different user groups in society, and the need to explore fairer, more sustainable arrangements for the future.In addition to these activities, in 2016–17 the Department published the following documents to inform road users and the broader community about road funding related matters:• Introduction to Road Economics;• Spending by Australian households on owning

and operating vehicles;• Fuel economy of Australian passenger vehicles

– a regional perspective; and• Growth in the Australian Road System.


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Analysis of performance against purpose—Surface Transport componentProductivity growth is a key source of long-term economic growth, business competitiveness and real per capita income growth. It is also an important determinant of a country’s living standards and wellbeing. Surface transport is a critical driver of national productivity. Every day, surface transport moves large volumes of freight from farm gates and factories to markets across Australia and the world. It also moves people and freight within our growing cities, where even small efficiency changes can have a significant impact on safety, environmental and urban amenity outcomes.

Growth in freight volumes is evidence that the Australian Government’s policies to support an efficient, competitive transport system are succeeding. Average freight volumes over the five years to 2016–17 totalled over 630.0 billion‑tonne‑kilometres (btkm) annually, up almost 20 per cent over average freight volumes in the five years to 2011–12. Iron ore and coal exports were the major contributors to rail freight growth in Australia. Road freight also continued to grow. The Department contributed to this result through investment in major infrastructure projects and the continued efficient and effective regulation of transport. The past decade of data show a declining trend for coastal trading volume. The most recent available data show a continuation of this trend with coastal freight decreasing from 105.4 btkm in 2013–14 to 105.2 btkm in 2014–15.

Increasing average freight vehicle loads fosters a more efficient transport system by increasing the productivity levels of transport movements. The introduction of combination trucks, including B-Doubles, in the 1980s revolutionised the freight task in Australia and higher productivity vehicles like road trains and innovatively designed Performance Based Standards scheme vehicles continue this trend. Austroads research indicates that higher productivity vehicles could deliver $12.6 billion in real benefits to Australia by 2030. Larger vehicle configurations carrying heavier loads decreases the number of vehicles required for the freight task, improving safety and emissions outcomes and traffic congestion. Over the five years to 2016–17, average freight vehicle loads of articulated trucks were around 20.5 tonnes per vehicle. The Department contributed to this result through its collaboration with the National Heavy Vehicle Regulator on improving road access for restricted access heavy vehicles, and providing support to its work on approving Performance Based Standards scheme vehicles. Investment in infrastructure through the Heavy Vehicle Safety and Productivity and the Bridges Renewal programs has also contributed to improved freight transport, especially in regional areas.

Road fatalities involving a heavy truck account for more than 90 per cent of fatalities where freight is being moved on surface transport (public roads, rail lines and commercial shipping). In 2016, 190 people were killed in crashes involving a heavy truck—down 13.2 per cent on the average annual number of road fatalities involving a heavy truck in the 10 years to 2015.

The Department works with state and territory governments to provide transparency about the services being delivered to the heavy vehicle industry, thereby ensuring greater scrutiny of costs (and ultimately prices charged) and ensuring heavy vehicle infrastructure is targeted where it is needed.

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The Transport and Infrastructure Council Asset Register shows for the first time, to 100 metre segments, the quality of heavy vehicle infrastructure in the Australian economy. The Asset Register grades roads, bridges, rest stops and the like, according to rideability (pavement roughness), reliability (travel time), accessibility (regulatory or infrastructure barriers), and safety outcomes (road safety infrastructure). Alongside Expenditure Plans, this allows public scrutiny of whether heavy vehicle road user charges are going towards the infrastructure that the industry needs to operate efficiently.

The Asset Register released in February 2017 covered approximately eight per cent of Australia’s total road network, up from approximately four per cent in the February 2016 release. The register is developed by the Australian Road Research Board, using information provided by state and territory governments, with the Department playing a coordination role.

In 2016–17, the Department continued efforts to accelerate heavy vehicle road reform as well as ongoing investigations into the potential high‑level benefits and costs of creating a broader land transport market, with road pricing for all vehicles. This work will provide options should governments wish to undertake more comprehensive reform, supported by evidence to demonstrate that reform would benefit the community (via a fairer system, with reduced congestion and better roads) and that benefits outweigh the costs.

Investigation of land transport market reform will involve extensive engagement with the community to explore reform options, costs and benefits. To support this engagement, the Department commissioned research in 2016–17 to understand the current levels of community awareness and understanding of road funding arrangements. This baseline information will provide a starting point for future discussions with the community on potential reform options.

From 2017–18, a major study will closely examine the way Australia funds and pays for its roads, and will investigate reform options including road pricing for light vehicles. Periodic research on community views of reform will be commissioned during the course of the study. The periodic surveys will, at a later stage, enable community understanding of road funding approaches to be compared with 2016–17 levels.

The Department’s ongoing focus is to build on rigorous, objective evidence to inform transport reform options that deliver Australians fairer, more sustainable transport systems.

The Department also contributes to improving maritime safety outcomes through implementation of the Navigation Act 2012, which gives effect to the International Convention for the Safety of Life at Sea (SOLAS). The objectives of the Navigation Act include promoting the safety of life at sea and safe navigation, and ensuring that the Australian Maritime Safety Authority (AMSA) has the necessary powers to carry out inspections of vessels and enforce national and international standards. The Department also contributes to maritime safety through its governance of AMSA, and working closely with AMSA in implementing maritime policy matters.


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Results against Road Safety measuresThe Road Safety program develops a safer road transport system by working to make vehicles and occupants safer, and drivers more informed.To serve this purpose the Department worked closely with the state and territory governments, the National Heavy Vehicle Regulator and National Transport Commission, vehicle engineers and manufacturers, freight industry participants and unions. Table 5.5 provides the summary results achieved by the Road Safety program against the performance measures. More detail is included in the analysis of performance against the purpose.

Table 5.5 Summary results against Road Safety measures




Target not met

There were 1,239 road deaths in 2016–17*, representing a reduction of 13.1 per cent relative to baseline 2008–10 figures (1,426 road deaths).* 2016–17 road death figure sourced from the Australian Road Deaths Database. The figure is preliminary and subject to revision, provided here as a provisional indication of progress.

14. Percentage of road vehicle standards harmonised with international standards


93 per cent of Australian road vehicle standards were considered as being harmonised with international standards in 2016–17, contributing to an increasing trend in harmonisation since the mid-1980s.

15. Average new light vehicle carbon dioxide (CO2) intensity

Decreasing trend Target met

182 grams of CO2 per kilometre (gCO2 /km) in 2016 calendar year, representing a 1.1 per cent reduction compared to 2015 (184 gCO2 /km).

16. Performance against service standards*, including:a. percentage of new type

approval applications decided on within 32 days

b. percentage of import approval applications decided on within 20 days

c. percentage of used import plate approval applications decided on within five days of the submission of a vehicle inspection certificate

* Service standards refers to the specific standards set by the Department for vehicle imports and certification services.

Greater than 95 per cent


a. The Department decided on 92 per cent of new type approval applications within 32 days.

b. The Department decided on 93 per cent of import approval applications within 20 days.

c. The Department decided on 72 per cent* of used import plate approval applications within five days of the submission of a vehicle inspection certificate.

* This figure includes the time applicants take to respond to questions on applications and the time taken to undertake audits. If these factors are excluded from the calculation, the performance measure is close to 95 per cent.

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Analysis of performance against purpose—Road Safety componentThe Department’s approach to road safety is based on the Safe System approach. This involves a holistic view of the road transport system and the interactions among roads and roadsides, travel speeds, vehicles and road users. It is an inclusive approach for all groups using the road system, including drivers, motorcyclists, passengers, pedestrians, cyclists, and commercial and heavy vehicle drivers. It recognises that people will always make mistakes and may have road crashes, but the system should be forgiving and those crashes should not result in death or serious injury.

Following stronger progress in the early years of the National Road Safety Strategy 2011–2020, the number of deaths in road crashes in 2016–17 represents only modest progress towards the 30 per cent reduction target. The Australian Government is committed to improving road safety and will ask an independent reference group to lead an inquiry into the strategy during 2017, looking closely at the evidence and advising what can be done better in future to prevent road trauma.

The Australian Design Rules (ADRs) require road vehicles to meet national design and performance standards before they can be supplied to the Australian market. The ADRs set requirements for vehicle safety, environmental performance and anti-theft protection in line with community expectations and international standards. Since the mid-1980s, the Department has worked to progressively harmonise the ADRs with internationally-based United Nations (UN) vehicle regulations. Harmonisation ensures that vehicles built to the most recent safety, environmental and anti-theft standards are supplied to the Australian market at the least cost and that Australia has access to the latest vehicle technologies. The Department contributed to furthering harmonisation in 2016–17 through the removal of unique Australian requirements no longer considered relevant and by further aligning ADRs with UN vehicle regulations where possible.

A reduction in the CO2 intensity of new light vehicles supports the sustainability of the transport system. In 2016 the average new light vehicle CO2 intensity was 182 gCO2 /km, representing a reduction of 1.1 per cent relative to the previous year. The Department contributed to this result primarily through administering the mandatory fuel consumption labelling scheme under the ADRs for new light vehicles, and maintaining the online Green Vehicle Guide. The label and the Green Vehicle Guide website enable car buyers to compare the environmental performance (such as fuel consumption and CO2 emissions) of vehicles sold in Australia to help inform their purchasing decisions.

While the average light vehicle CO2 intensity is improving in Australia, it remains behind many other comparable countries. The Australian Government established a Ministerial Forum on Vehicle Emissions in 2015 to look at options to reduce emissions from the road transport sector. The Department lead an inter-departmental working group to support the Ministerial Forum on Vehicle Emissions, and released a Regulation Impact Statement in December 2016 to explore the case for introducing fuel efficiency standards for new light vehicles. The Australian Government will take a decision on this issue in the second half of 2017.

Performance against service standards for vehicle related applications was adversely impacted during 2016–17 by a number of factors, including: difficulty recruiting suitably qualified staff to fill vacancies in the section that processes type approval applications;


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processing issues arising from the introduction of a new IT system and workforce adjustment for vehicle import approvals; and additional questions being raised in response to used import plate approval applications to address risks related to the Takata airbag recall.

Continuing to focus on improving sustainability and safety outcomes for road users is important to reduce the social and economic impacts of crashes and to improve the long-term sustainability of the road system. The Department’s ongoing focus is on evidence‑based improvements for the future benefit of all Australians.

Results against Air Transport measuresThe Air Transport program ensures the aviation industry operates within a clear and robust safety regulatory environment and Australian businesses and consumers have access to competitive international and domestic air services, along with maintaining aviation safety.

To serve this purpose the Department worked closely with state and territory governments, Airservices Australia and the Civil Aviation Safety Authority, industry, international partners and forums including ICAO.

Table 5.6 provides the summary results achieved by the Air Transport program against the performance measures. More detail is included in the analysis of performance against the purpose.

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Table 5.6 Summary results against Air Transport measures


17. Level of available aviation capacity at major city airports


Target met

New and updated air services arrangements increase available capacity at major city airports by expanding commercial opportunities for airlines in new and existing markets.In 2016–17, there were 103 air services arrangements in place. This is an increase compared to 2015–16, when there were 98 air service arrangements in place.During 2016–17, eight existing air services arrangements were updated (two arrangements include unlimited capacity for airlines) and five new arrangements were made, increasing the level of capacity available for both Australian and foreign airlines. Four air services agreements were signed.

18. Level of available capacity in international aviation markets


Target met

New and updated air services arrangements increase available capacity in international aviation markets by expanding commercial opportunities for airlines in new and existing markets.In 2016–17, there were 103 air services arrangements in place. This is an increase compared to 2015–16, when there were 98 air service arrangements in place. During 2016–17, eight existing air services arrangements were updated (two arrangements include unlimited capacity for airlines), and five new arrangements were made, increasing the level of capacity available for both Australian and foreign airlines. Four air services agreements were signed.

19. Opportunities available to Australian airlines in international aviation markets


Target met

New and updated arrangements increase opportunities for Australian airlines to serve the respective market, either using their own aircraft or through cooperative commercial arrangements with foreign airlines (for example, code share).In 2016–17, there were 103 air services arrangements in place. This is an increase compared to 2015–16, when there were 98 air service arrangements in place. During 2016–17, eight existing air services arrangements were updated (two arrangements include unlimited capacity for airlines), and five new arrangements were made, increasing the level of capacity available for Australian airlines. Four air services agreements were signed.

20. Level of aviation services to remote communities

Maintain service levels compared to previous financial year

Target met

In 2016–17, aviation services were provided to 266 remote communities.This maintains the service level provided in 2015–16, which was 266 communities.Assistance was provided to improve access and safety at remote airstrips.

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21. Jobs supported by Western Sydney Airport project

Regulatory settings and investment strategy in place for the Western Sydney Airport project.Demonstrated through the frameworks and strategies in place to capitalise on employment opportunities and through the delivery of the Western Sydney Airport project.

Target met

Regulatory approvals for the construction and operation of the Western Sydney Airport were granted in December 2016 that authorise the Stage 1 airport development. These approvals operate with an investment strategy announced in the 2017–18 federal budget, to ensure that construction works will commence in 2018 and the airport is operational in 2026.A priority for the airport development is to make the most of employment opportunities for residents of Western Sydney. Under the conditions of the Airport Plan, WSA Co Limited – the Government-owned company established to deliver the airport, will prepare an Australian Industry Participation Plan. The plan will address ways in which local employment and business opportunities can be maximised and must consider local industry participation in the development of the airport.An equal opportunity policy that includes raining and suitable employment opportunities for young workers, Indigenous people and people with disadvantages will also be implemented by WSA Co Limited.The Western Sydney Airport project is expected to add $1.9 billion to Western Sydney’s economy during the construction phase alone.Based on the most recent analysis, the airport will support almost 28,000 direct and indirect jobs in Western Sydney by 2031 and nearly 120,000 in the long term. With the additional investment the airport will bring to the surrounding region, the project will be a major catalyst to create jobs and reduce Western Sydney’s employment shortage.

Analysis of performance against purpose—Air Transport componentThe Australian aviation sector is an integral part of an efficient, sustainable transport system, providing critical connectivity that facilitates the swift movement of people and cargo.

Increasing major city airport capacity will foster an efficient, sustainable transport system by ensuring airlines can meet aviation demand in a vibrant and competitive market. Capacity effectively increased across Australia’s major city airports during the year. The Department contributed to this result through negotiating new and expanded air services arrangements with 17 economies in 2016–17. Other contributing factors included the strong growth of the Chinese aviation market, ongoing growth to leisure-orientated destinations on Australia’s east coast, which offset declines on routes that primarily serve the resources sector.

Increasing the level of capacity in international aviation markets will foster an efficient and sustainable transport system by facilitating greater levels of competition and ensuring there is sufficient capacity to meet demand in key markets. In 2016–17, 13 of the 17 new and updated air services arrangements the Department negotiated increased the level of capacity available for both Australian and foreign airlines into the respective bilateral market to varying degrees. Two of these arrangements include unlimited capacity for Australian

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and foreign airlines into the respective market. It will be up to airlines (both Australian and foreign) to determine how they use the commercial entitlements negotiated in these air services arrangements.

Increasing opportunities available to Australian airlines in international aviation markets will foster a more efficient and sustainable transport system by ensuring Australian airlines have a fair and equal opportunity to compete. In 2016–17, the Department negotiated 17 new and updated air services arrangements which increase opportunities for Australian airlines to serve the respective bilateral market, either with their own aircraft, or through cooperative commercial arrangements with foreign airlines (for example, code share). It will be up to Australian airlines to determine how they use the commercial entitlements negotiated in these air services arrangements.

Maintaining the level of aviation services to remote communities ensures that Australian businesses and consumers have access to remote communities and community residents can access goods and services as well as regional service centres. Services were maintained in 2016–17 to 266 designated remote communities by the Australian Government providing weekly subsidised flights under the Remote Air Services Subsidy (RASS) Scheme.

Having regulatory settings and an investment strategy in place for the Western Sydney Airport project will foster an efficient, sustainable transport system. The 2012 Joint Study into Aviation Capacity in the Sydney Region reviewed the future of aviation capacity in the Sydney basin, finding that by the late 2020s, Sydney Airport would no longer have slot capacity and by the mid-2030s, would be totally growth-constrained unless further capacity was added to the basin. Western Sydney Airport will provide the capacity to enable Sydney’s high-value aviation sector to continue to grow and service Sydney’s needs.

In particular, Western Sydney Airport will service the aviation demands of Western Sydney, including more than two million Western Sydney residents for who Western Sydney Airport will be closer than Kingsford Smith Airport. Western Sydney residents will also benefit from the employment generated by the airport: over 11,000 direct and indirect jobs over the whole construction phase, and over 20,000 direct and indirect jobs within five years of the airport commencing operations. These job numbers will continue to grow as the airport passenger throughput grows. By the 2060s, the airport is projected to support nearly 120,000 direct and indirect jobs.

Western Sydney residents, airport employees and passengers will also benefit from the ground transport linkages to and around the airport. The $3.6 billion WSIP extends, widens or establishes modern road infrastructure around Western Sydney. A rail study with the NSW Government is also underway.

In 2016–17, the Department completed the Environmental Impact Statement and finalised the Airport Plan for the Western Sydney Airport project, and completed the Right of First Refusal process with Sydney Airport Group. These activities resulted, respectively, in an authorisation to develop the project, which takes into account environmental protection conditions and supports the Government’s decision to develop the airport project itself.


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Performance against purpose 3: Strengthen the sustainability, capacity and diversity of regional economies and support local communities

Results against Regional Development measuresThe Regional Development program undertakes a range of regionally focused stakeholder consultation and engagement, research, policy development and program delivery activities.

To serve this purpose, the Department worked closely with all tiers of government and local stakeholders to maximise the natural and comparative strengths of Australia’s regions.

Table 5.7 provides the summary results achieved by the Regional Development program against the performance measures. More detail is included in the analysis of performance against the purpose.

Table 5.7 Summary results against Regional Development measures


22. Jobs supported by regional program investments

Demonstrated through the delivery of Australian Government funded projects

Target met

Regional Development program expenditure totalled $2.5 billion in 2016–17. By implementing these projects, the Australian Government is supporting jobs in the regions in which they are delivered.Data indicating the total number of jobs supported across all regional development projects are currently unavailable, however the Department has started to collect these data from proponents.Case Study D on page 95 demonstrates jobs supported through the delivery of a number of Australian Government funded projects, with job numbers provided by proponents.

23. Number of employed persons outside capital cities**Employed persons includes those in all forms of paid employment (full-time, part-time and casual)


Target met

The number of employed persons outside capital cities was 3.86 million in 2016–17.This is an increase compared to 2015–16, which was 3.83 million employed persons.

24. Disposable household income for low and middle incomes outside capital cities



The most recent data available are for 2013–14. The Australian Bureau of Statistics releases new data every two years. Data for 2015–16 are expected to be released in October 2017.From 2011–12 to 2013–14, disposable household income for low and middle incomes outside capital cities increased from $498 per week to $507 per week.This positive trend indicates the 2016–17 target is likely to have been met.

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Measure 22–Case Study D: Jobs supported by regional program investmentsThe Sense‑T project is creating the world’s first economy‑wide intelligent sensor network to provide up-to-date, real-time information to businesses, governments and communities. The Sense-T Stage 2 project established an Advanced Sensor Manufacturing Facility in Launceston, Tasmania and 21 related research projects. The research has delivered commercial solutions to apply sensor technology to help priority Tasmanian industries (agriculture, tourism, health, new financial services and infrastructure, freight and logistics). The facility was opened on 17 March 2017 and now employs four full-time and six casual staff and has already demonstrated the ability to manufacture 500 medium complexity sensor boards a day, equating to 10,000 sensor boards a month. The research projects have already delivered and secured 114 Tasmanian jobs. The Sense-T Stage 2 project commenced in September 2014 and was completed in March 2017. The Australian Government committed $13.0 million to this $14.9 million project.

The following projects also supported a significant number of jobs:

• Aquatic Recreation Centre in Gympie, Queensland—this project, for which the Australian Government provided $5.0 million, created more than 130 jobs during construction and a further 30 ongoing jobs at the centre. The facility opened in April 2017.

• Kidzwish Place in Flinders, NSW—this project, for which the Australian Government is providing $915,456, will create approximately 225 jobs during construction. Following the completion of this upgrade, this facility is also expected to employ 29 people by 2021. Construction started in April 2017.

• West Gippsland Arts Centre upgrade in Gippsland, Victoria—this project, for which the Australian Government is providing $4.0 million, will create 160 direct jobs during construction, along with another 21 ongoing jobs. Construction started in April 2017.

Analysis of performance against purpose—Regional Development componentInvestments in infrastructure, regional programs and improved community capability have an impact on the efficiency of regional economies and the amenity of regions, which influences employment.

Employment is strongly linked to the economic and social wellbeing of individuals and to the wellbeing of communities more broadly. Increases in the number of employed persons and disposable household income is an indicator of improved living standards within a community and is also linked to the sustainability and capacity of regional economies.

Result against Local Government measureThe Local Government program aims to strengthen local government capacity and better support local communities by providing policy advice to the Australian Government and financial assistance to local governments. To serve this purpose, the Department worked closely with local governments and other local stakeholders.


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Table 5.8 provides the summary results achieved by the Local Government program against the performance measures. More detail is included in the analysis of performance against the purpose.

Table 5.8 Summary result against Local Government measure


25. Financial assistance is provided to support equitable levels of services by local government bodies

Financial assistance is provided in accordance with the Local Government (Financial Assistance) Act 1995

Target met

$3.5 billion in financial assistance was provided to local government bodies in 2016–17 in accordance with the Local Government (Financial Assistance) Act 1995

Analysis of performance against purpose—Local Government componentThrough the Financial Assistance Grants program, the Australian Government supports equitable levels of local government services. The program aims to strengthen the sustainability, capacity and diversity of regional economies. In 2016–17, $3.5 billion was provided to 546 local governing bodies to support community priorities in accordance with the Local Government (Financial Assistance) Act 1995. The Department delivered the 2016–17 grant payments on time and in accordance with legislative requirements. In addition, the Department made an early payment of 50 per cent of the 2017–18 funding allocation. This cash injection of almost $1.2 billion gives councils the opportunity to start work immediately on new projects and to benefit from additional interest on having cash in the bank.

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Performance against purpose 4: Provide good governance in Australian territories

Results against Services to Territories measuresThe Services to Territories program aims to improve the quality of services provided to residents of the external territories and the Jervis Bay Territory, and provides targeted support to the NT and ACT through economic and social sustainability initiatives, delivery of services and managing the Australian Government’s interests in the territories.

To serve this purpose, the Department worked closely with service delivery providers, including commercial contractors, as well as with all tiers of government.

Table 5.9 below provides the summary results achieved by the Service to Territories program against the performance measures. More detail is included in the analysis of performance against the purpose.

Table 5.9 Summary results against Services to Territories measures


26. Legal frameworks in place in the external territories and the Jervis Bay Territory that provide comparable rights and protections to citizens as the rest of Australia

State level laws are applied and/or updated in each of the external territories and the Jervis Bay Territory as appropriate to reflect comparable arrangements


State level laws were applied and/or updated in the Territories of Christmas Island, Cocos (Keeling) Islands and the Jervis Bay Territory to reflect arrangements in other comparable communities.The Department is only 12 months into the Norfolk Island reform program, and this is a significant and complex task. In May 2017, a framework to guide the Australian Government’s consultation on legislative changes was approved. Amendments to some existing Norfolk Island laws have been undertaken and the application of state-level laws, as Commonwealth law, has commenced.

27. State-type services are delivered in the external territories and the Jervis Bay Territory similar to comparable mainland communities

Services are delivered in accordance with Service Delivery Agreements and contracts


State level services were delivered in accordance with service delivery arrangements and contracts in the Territories of Christmas Island, Cocos (Keeling) Islands and the Jervis Bay Territory. Essential infrastructure continued to support delivery of services.The Department is only 12 months into the Norfolk Island reform program, and this is a significant and complex task. The Department is working closely with the NSW Government, the Norfolk Island Regional Council and the Norfolk Island Health and Residential Aged Care Service on service delivery arrangements for state-level services on Norfolk Island, including health, residential aged care, education and child wellbeing.


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Analysis of performance against purpose—Services to Territories componentThe Department plays an important role in administering Norfolk Island, Christmas Island, the Cocos (Keeling) Islands, the Ashmore and Cartier Islands, the Coral Sea Islands and the Jervis Bay Territory. It also manages the Australian Government’s interests in the NT and ACT.

To provide good governance and ensure comparable rights and protections to citizens of the external territories and the Jervis Bay Territory, the Department maintains appropriate legal frameworks, including preparing Ordinances and Determinations as required. In 2016–17, state‑level laws that reflected comparable legislative standards and management arrangements to those in Australian states were applied.

Further contributing to good governance in the Australian territories, services in the external territories and Jervis Bay Territory were delivered in accordance with Service Delivery Arrangements and private sector contracts. The Department also supported ongoing service delivery by maintaining essential infrastructure. For example, the Department supported the provision of essential internet services to Christmas Island from March to June 2017 and provided financial support to the community during an outage of the Christmas Island port crane. On Norfolk Island, significant investments were made in the redevelopment of Cascade Pier and improvements to the Norfolk Island Central School and the Norfolk Island Health and Residential Aged Care Service.

The Department met the performance targets for the Indian Ocean Territories and the Jervis Bay Territory, which reflects the maturity of these programs. It is noted the Department is only 12 months into the reform program for transitioning Norfolk Island from 35 years of self-government with its own Legislative Assembly and laws to contemporary governance arrangements representative of mainland arrangements. The Norfolk Island Reform program is a significant and complex task that continues to make positive progress.

6FINANCIAL STATEMENTS


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INDEPENDENT AUDITOR’S REPORT

To the Minister for Regional Development, Minister for Local Government and Territories

Opinion

In my opinion, the financial statements of the Department of Infrastructure and Regional Development for the year ended 30 June 2017:

(a) comply with Australian Accounting Standards and the Public Governance, Performance and Accountability (Financial Reporting) Rule 2015; and

(b) present fairly the financial position of the Department of Infrastructure and Regional Development as at 30 June 2017 and its financial performance and cash flows for the year then ended.

The financial statements of the Department of Infrastructure and Regional Development, which I have audited,comprise the following statements as at 30 June 2017 and for the year then ended:

• Statement by the Secretary and Chief Financial Officer; • Statement of Comprehensive Income; • Statement of Financial Position; • Statement of Changes in Equity; • Cash Flow Statement; • Administered Schedule of Comprehensive Income; • Administered Schedule of Assets and Liabilities; • Administered Reconciliation Schedule; • Administered Cash Flow Statement; and • Notes to and forming part of the financial statements, comprising a Summary of Significant Accounting

Policies and other explanatory information.

Basis for Opinion

I conducted my audit in accordance with the Australian National Audit Office Auditing Standards, which incorporate the Australian Auditing Standards. My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report. I am independent of the Department of Infrastructure and Regional Development in accordance with the relevant ethical requirements for financial statement audits conducted by the Auditor-General and his delegates. These include the relevant independence requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants to the extent that they are not in conflict with the Auditor-General Act 1997 (the Code). I have also fulfilled my other responsibilities in accordance with the Code. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Key Audit Matters

Key audit matters are those matters that, in my professional judgement, were of most significance in my audit of the financial statements of the current period. These matters were addressed in the context of my audit of the financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters.

Key audit matter

Valuation of Concessional Loans

Refer to Note 4.1B ‘Administered – Trade and Other Receivables’

I focused on this area given the significance of this balance to the Department of Infrastructure and

How the audit addressed the matter

To audit these concessional loans, I performed the following audit procedures:

• evaluated the methodology developed and adopted by the Department of Infrastructure and Regional Development to determine the market interest rate used in the fair valuation of these loans, including

GPO Box 707 CANBERRA ACT 260119 National Circuit BARTON ACTPhone (02) 6203 7300 Fax (02) 6203 7777

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Part 6: Financial statements

Regional Development’s financial statements and the complexity in the accounting treatment and calculations required for the recognition and valuation of concessional loans given:

• the level of estimation and judgement required to determine the market interest rate to be used in the valuation of loans and associated discount expense and revenue; and

• the range and potential combination of concessional terms that may be included in individual loans.

For the year ended 30 June 2017 the value of administered trade and other receivables for advances and loans was $1 559.8 million.

the assumptions used and sensitivity analysis undertaken; and

• tested, on a sample basis, loans advanced during the year to signed funding agreements and approvals required under the applicable legislationto assess amounts and timing of advances, actual interest rates applied and loan terms.

Key audit matter

Valuation of the Australian Government’s Investment in the Australian Rail Track Corporation and Airservices Australia

Refer to Note 4.1D ‘Administered – Investments’

I focused on this balance given the significant value of these investments to the Department of Infrastructure and Regional Development’s financial statements and the judgement involved in determining the fair value of the Australian Rail Track Corporation and Airservices Australia administered investment assets.

The discounted cash flow model used to determine the fair value of these administered investments requires a high level of judgement and estimation by the department because the chief inputs to the valuation models are unobservable.

For the year ended 30 June 2017 the value of the administered investment held for the Australian Rail Track Corporation was $3 502.0 million and for Airservices Australia $897.5 million.

How the audit addressed the matter

To audit the valuation of the Australian Government’s investment in the Australian Rail Track Corporation and Airservices Australia, I performed the following audit procedures:• assessed the appropriateness of assumptions and

inputs used in the Department of Infrastructure and Regional Development’s valuation models for the Australian Rail Track Corporation and Airservices Australia;

• compared the key inputs used in the valuation models against comparable external data where it was available; and

• considered the sensitivity of the valuation methodologies by adjusting key assumptions for reasonably foreseeable alternate scenarios.

Accountable Authority’s Responsibility for the Financial Statements

As the Accountable Authority of the Department of Infrastructure and Regional Development the Secretary is responsible under the Public Governance, Performance and Accountability Act 2013 for the preparation and fair presentation of annual financial statements that comply with Australian Accounting Standards and the rules made under that Act. The Secretary is also responsible for such internal control as the Secretary determines is necessary to enable the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Secretary is responsible for assessing the Department of Infrastructure and Regional Development’s ability to continue as a going concern, taking into account whether the entity’s operations will cease as a result of an administrative restructure or for any other reason. The Secretary is also responsible for disclosing matters related to going concern as applicable and using the going concern basis of accounting unless the assessment indicates that it is not appropriate.

Auditor’s Responsibilities for the Audit of the Financial Statements

My objective is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian National Audit Office Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the


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aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

As part of an audit in accordance with the Australian National Audit Office Auditing Standards, I exercise professional judgement and maintain professional scepticism throughout the audit. I also:

• identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;

• obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control;

• evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Accountable Authority;

• conclude on the appropriateness of the Accountable Authority’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the entity’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the entity to cease to continue as a going concern; and

• evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

I communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.

From the matters communicated with those charged with governance, I determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. I describe these matters in my auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Australian National Audit Office

Lesa CraswellActing Executive Director

Delegate of the Auditor-General

Canberra31 August 2017

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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTSTATEMENT OF COMPREHENSIVE INCOMEfor the period ended 30 June 2017

Original Budget

2017 2016 2017Notes $'000 $'000 $'000

NET COST OF SERVICESExpenses

Employee benefits 1.1A 133,365 139,237 145,999 Suppliers 1.1B 114,822 114,511 125,307 Grants 1.1C 357 882 -Depreciation and amortisation 3.2A 9,253 12,236 12,050 Finance costs - unwinding of discount 1.1D 17 179 174Write-down and impairment of assets 1.1E 473 926 -

Total expenses 258,287 267,971 283,530

Own-Source Income

Own-source revenueSale of goods and rendering of services 1.2A 3,389 4,065 4,121 Other revenue 1.2B 940 636 732

Total own-source revenue 4,329 4,701 4,853

GainsGains from sale of assets - 1 -Other gains 1.2C 1,067 10,436 860

Total gains 1,067 10,437 860Total own-source income 5,396 15,138 5,713 Net cost of services 252,891 252,833 277,817

Revenue from Government 1.2D 248,457 261,691 265,767 Surplus/(Deficit) on continuing operations (4,434) 8,858 (12,050)

OTHER COMPREHENSIVE INCOME

Items not subject to subsequent reclassification to net cost of servicesChanges in asset revaluation surplus (1,201) 15,397 -

Total other comprehensive income/(loss) (1,201) 15,397 -Total comprehensive income/(loss) (5,635) 24,255 (12,050)

The above statement should be read in conjunction with the accompanying notes.

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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTSTATEMENT OF FINANCIAL POSITIONas at 30 June 2017

Original Budget

2017 2016 2017Notes $'000 $'000 $'000

ASSETSFinancial assets

Cash and cash equivalents 3.1A 1,850 2,138 1,600 Trade and other receivables 3.1B 144,026 130,044 114,280 Accrued revenue 3.1D 1,084 1,314 1,000

Total financial assets 146,960 133,496 116,880

Non-financial assetsLand and buildings 3.2A 19,919 20,773 7,101 Property, plant and equipment 3.2A 5,768 7,007 8,633 Intangibles 3.2A 10,959 11,978 11,267 Other non-financial assets 3.2B 3,995 3,711 4,294

Total non-financial assets 40,641 43,469 31,295 Total assets 187,601 176,965 148,175

LIABILITIESPayables

Suppliers 3.3A 23,592 17,362 18,015 Other payables 3.3B 3,061 1,773 2,789

Total payables 26,653 19,135 20,804

ProvisionsEmployee provisions 6.1A 45,001 46,184 46,342 Other provisions 3.4 1,803 3,358 10,142

Total provisions 46,804 49,542 56,484 Total liabilities 73,457 68,677 77,288 Net assets 114,144 108,288 70,887

EQUITYContributed equity (104,768) (116,259) (104,776)Reserves 33,771 34,972 19,575 Accumulated surplus 185,141 189,575 156,088

Total equity 114,144 108,288 70,887



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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTSTATEMENT OF CHANGES IN EQUITYfor the period ended 30 June 2017

Original Budget

2017 2016 2017Notes $'000 $'000 $'000

CONTRIBUTED EQUITYOpening balanceBalance carried forward from previous period (116,259) (119,460) (116,267)

Transactions with ownersContributions by ownersDepartmental capital budget 11,491 3,201 11,491 Restructuring 8.2A - - -Total transactions with owners 11,491 3,201 11,491 Closing balance as at 30 June (104,768) (116,259) (104,776)

ACCUMULATED SURPLUSOpening balanceBalance carried forward from previous period 189,575 180,717 168,138

Comprehensive incomeSurplus/(Deficit) for the period (4,434) 8,858 (12,050)Total comprehensive income (4,434) 8,858 (12,050)Closing balance as at 30 June 185,141 189,575 156,088

ASSET REVALUATION RESERVEOpening balanceBalance carried forward from previous period 34,972 19,575 19,575

Comprehensive incomeOther comprehensive income

Changes in asset revaluation surplusNon-current assets (1,201) 14,993 -Provision for restoration - 404 -

Total comprehensive income (1,201) 15,397 -Closing balance as at 30 June 33,771 34,972 19,575

TOTAL EQUITYOpening balanceBalance carried forward from previous period 108,288 80,832 71,446

Comprehensive incomeSurplus/(Deficit) for the period (4,434) 8,858 (12,050)Other comprehensive income

Changes in asset revaluation surplusNon-current assets (1,201) 14,993 -Provision for restoration - 404 -

Total comprehensive income (5,635) 24,255 (12,050)

Transactions with ownersContributions by ownersDepartmental capital budget 11,491 3,201 11,491 Restructuring 8.2A - - -Total transactions with owners 11,491 3,201 11,491 Closing balance as at 30 June 114,144 108,288 70,887


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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTSTATEMENT OF CHANGES IN EQUITYfor the period ended 30 June 2017

5

Accounting Policy

Equity InjectionsAmounts appropriated which are designated as ‘equity injections’ for a year (less any formal reductions) and Departmental Capital Budgets (DCBs) are recognised directly in contributed equity in that year.

Restructuring of Administrative ArrangementsNet assets received from or relinquished to another Government entity under a restructuring of administrative arrangements are adjusted at their book value directly against contributed equity.

Other Distributions of OwnersThe Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR)requires that distributions to owners be debited to contributed equity unless it is in the nature of a dividend.


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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTCASH FLOW STATEMENTfor the period ended 30 June 2017

Original Budget

2017 2016 2017Notes $'000 $'000 $'000

OPERATING ACTIVITIESCash received

Appropriations 260,581 278,874 277,205 Sale of goods and rendering of services 5,316 6,871 6,629 Net GST received 10,161 11,593 -Other 413 109 302

Total cash received 276,471 297,447 284,136

Cash usedEmployees 133,716 145,232 144,914 Suppliers 122,252 129,795 132,068 Section 74 receipts transferred to OPA 20,777 22,588 5,801

Total cash used 276,745 297,615 282,783 Net cash from/(used by) operating activities (274) (168) 1,353

INVESTING ACTIVITIESCash received

Proceeds from sales of property, plant and equipment - 1 -

Total cash received - 1 -

Cash usedPurchase of land and building 1,826 788 5,175 Purchase of property, plant and equipment 1,767 2,315 4,224 Purchase of intangibles 2,940 3,877 3,445

Total cash used 6,533 6,980 12,844 Net cash (used by) investing activities (6,533) (6,979) (12,844)

FINANCING ACTIVITIESCash received

Appropriations - contributed equity 6,519 6,982 11,491 Total cash received 6,519 6,982 11,491 Net cash from financing activities 6,519 6,982 11,491

Net increase/(decrease) in cash held (288) (165) -Cash and cash equivalents at the beginning of the reporting period 2,138 2,303 1,600 Cash and cash equivalents at the end of the reporting period 3.1A 1,850 2,138 1,600


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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTfor the period ended 30 June 2017

Budget Variances Commentary

Statement of Comprehensive Income

Expenses

Employee benefits expenses are under budget by $12.6 million or 9% mainly due to lower than anticipated Average Staffing Levels through delays in filling vacant positions and changes in the discount rate used to value long service leave provisions (see employee provisions below).

Supplier expenses are under budget by $10.5 million or 8% mainly due to:

(a) the deferral of expenditure on the new Western Sydney Airport project to the 2017-18 financial year; and(b) the reclassification of environmental management costs required under the Western Sydney Airport plan

of $5 million to administered expenses.

Grant expenses reflect non-reciprocal contributions that were originally budgeted as supplier expenses.

Depreciation and amortisation expenses are under budget by $2.8 million or 23% due to the revaluation andextension of useful lives of leasehold improvement assets at 30 June 2016, recognised after the estimates for 2016-17 were prepared.

Finance costs reflect the unwinding of makegood provisions in office leases. The variance is due to the waiver of makegood requirements for new office leases in Canberra (see other provisions below).

No budget allowance was made for write-down and impairment of assets as these expenses cannot be reliably predicted.

Income

Revenue from Government is under budget by $17.3 million or 7% to reflect amounts withheld under s51 of the PGPA Act associated with the deferral and reclassification of expenses for the Western Sydney Airport project (see Note 5.1A).

Statement of Financial Position

Financial assets are over budget by $30.1 million mainly due to an increase in appropriation receivables at 30 June 2017 arising from the opening balance and retention of funds to meet increased accrued expenses and capital expenditure in 2017-18.

Non-financial assets are over budget by $9.3 million mainly due to:(a) a revaluation of leasehold improvement assets at 30 June 2016, recognised after estimates for 2016-17

were prepared; partially offset by(b) a revaluation decrement to other property, plant and equipment assets during 2016-17.

Payables are over budget by $5.8 million or 28% due to a higher level of accrued expenses at 30 June 2017 than budgeted for the Western Sydney Airport project.

Employee provisions are $1.3 million or 3% under budget mainly due to a change in the discount rate used to determine the present value of long service leave provisions.

Other provisions are under budget by $8.3 million mainly due to the waiver of makegood requirements for major Canberra offices as a result of new lease agreements.

Statement of Changes in Equity

Total equity is over budget by $43 million or 61% mainly due to changes in accumulated results and asset revaluations at 30 June 2016, recognised after estimates for 2016-17 were prepared.

Cash Flow Statement

Variances in the Cash Flow Statement are broadly consistent with the variances explained above for income and expenses. The variance in cash used for investing activities reflects the deferral of capital projects into 2017-18.


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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTADMINISTERED SCHEDULE OF COMPREHENSIVE INCOMEfor the period ended 30 June 2017

Original Budget

2017 2016 2017Notes $'000 $'000 $'000

NET COST OF SERVICESExpenses

Employee benefits 2.1A 13,948 14,761 17,927Suppliers 2.1B 143,506 122,487 129,245Subsidies 2.1C 206,248 195,698 244,508Grants 2.1D 5,004,964 2,792,240 4,189,971Depreciation and amortisation 4.2A 53,864 39,949 30,590Write-down and impairment of assets 2.1E 425,338 1,734 -Payments to corporate Commonwealth entities 2.1F 122,547 116,180 122,801Concessional loans 117,593 4,448 148,693Protection of the sea levy payment 394 - 1,000

Total expenses 6,088,402 3,287,497 4,884,735

Income

RevenueTaxation revenue

Other taxes 2.2A 41,692 39,354 38,944Total taxation revenue 41,692 39,354 38,944

Non-taxation revenueSale of goods and rendering of services 2.2B 20,493 21,100 17,445Building Australia Fund revenue - 6,920 122,600Industry contributions 1,204 1,974 2,091Other contributions - 36,260 -Fees and fines 2.2C 204,194 205,562 212,667Interest 2.2D 46,180 33,856 46,857Dividends 82,814 94,259 97,900Other revenue 2.2E 5,826 8,924 15,666

Total non-taxation revenue 360,711 408,855 515,226 Total revenue 402,403 448,209 554,170

GainsGains from sale of assets 2 - -Other gains 2.2F 11,773 11,189 786

Total gains 11,775 11,189 786Total income 414,178 459,398 554,956 Net (cost of) services (5,674,224) (2,828,099) (4,329,779)Deficit (5,674,224) (2,828,099) (4,329,779)

OTHER COMPREHENSIVE INCOMEItems not subject to subsequent reclassification to net cost of servicesChanges in asset revaluation surplus 568,368 (23,532) -Total other comprehensive income/(loss) 568,368 (23,532) -Total comprehensive loss (5,105,856) (2,851,631) (4,329,779)

The above schedule should be read in conjunction with the accompanying notes.

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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTADMINISTERED SCHEDULE OF ASSETS AND LIABILITIESas at 30 June 2017

Original Budget

2017 2016 2017Notes $'000 $'000 $'000

ASSETSFinancial assets

Cash and cash equivalents 4.1A 74,176 7,765 15Trade and other receivables 4.1B 1,561,497 1,045,863 1,583,240 Investments 4.1D 4,776,549 4,321,699 5,000,982 Accrued revenue 4.1E 10,309 12,253 12,183

Total financial assets 6,422,531 5,387,580 6,596,420

Non-financial assetsLand and buildings 4.2A 540,146 389,579 224,151 Property, plant and equipment 4.2A 470,745 473,469 398,291 Intangibles 4.2A 5,078 6,328 1,244 Inventories 4.2B 2,277 2,717 2,403 Prepayments 4.2C 11,260 9,158 -

Total non-financial assets 1,029,506 881,251 626,089 Total assets administered on behalf of Government 7,452,037 6,268,831 7,222,509

LIABILITIESPayables

Suppliers 4.3A 12,320 12,010 8,672 Subsidies 4.3B 8,196 12,773 7,078 Grants 4.3C 29,550 23,519 19,305 Other payables 4.3D 336 207 308

Total payables 50,402 48,509 35,363

ProvisionsEmployee provisions 6.1B 3,477 3,863 3,454 Other provisions 4.4 3,065 3,092 2,697

Total provisions 6,542 6,955 6,151 Total liabilities administered on behalf of Government 56,944 55,464 41,514

Net assets 7,395,093 6,213,367 7,180,995

The above schedule should be read in conjuction with the accompanying notes.


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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTADMINISTERED RECONCILIATION SCHEDULEfor the period ended 30 June 2017

2017 2016Notes $'000 $'000

Opening assets less liabilities as at 1 July 6,213,367 5,967,039

Net (cost of)/contribution by servicesIncome 414,178 459,398 Expenses

Payments to entities other than corporate Commonwealth entities (5,965,855) (3,171,317)Payments to corporate Commonwealth entities (122,547) (116,180)

Other comprehensive incomeRevaluations transferred to reserves - non-financial assets 173,635 242,908 Revaluations transferred to/(from) reserves - investments 394,903 (266,440)Impairment of non-financial assets transferred from reserves (170) -

Transfers (to)/from Australian GovernmentAppropriation transfers from Official Public Account (OPA)

Administered asset and liabilities appropriations 805,966 271,000 Annual appropriations

Payments to entities other than corporate Commonwealth entities 1,589,603 1,675,274 Payments to corporate Commonwealth entities 123,005 116,180 Refund of administered receipts - section 77 PGPA Act 817 235GST 11,804 10,810

Special appropriations (unlimited)Payments to corporate Commonwealth entities 241,222 243,901 Special accounts 68,497 77,278 Protection of the Sea Pollution Compensation Fund 394 -Special appropriations - Financial Assistance Grants 3,472,151 1,144,188

Appropriation transfers to OPATransfers to OPA (381,759) (442,806)Transfers to OPA non-cash (394) -

Other transfersRestructuring - 1,899 Contribution by owners1 356,276 -

7,395,093 6,213,367

The above schedule should be read in conjunction with the accompanying notes.

1 On 24 January 2017, land and associated assets at Moorebank NSW were transferred from the Department of Defence (see Note 4.2A). This transfer was formally designated as a ‘contribution by owners through equity’ by the Minister for Finance

Accounting Policy

Administered cash transfers to and from the Official Public AccountRevenue collected by the Department for use by the Government rather than the Department is administered revenue. Collections are transferred to the Official Public Account (OPA) maintained by the Department of Finance. Conversely, cash is drawn from the OPA to make payments under Parliamentary appropriation on behalf of the Government. These transfers to and from the OPA are adjustments to the administered cash held by the Department on behalf of the Government and reported as such in the Schedule of Administered Cash Flows and the Administered Reconciliation Schedule.

Closing assets less liabilities as at 30 June

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DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTADMINISTERED CASH FLOW STATEMENTfor the period ended 30 June 2017

2017 2016Notes $'000 $'000

OPERATING ACTIVITIESCash received

Other taxes 40,085 39,820 Sale of goods and rendering of services 18,896 25,215 Building Australia Fund revenue - 6,920 Industry contributions 1,204 1,974 Fees and fines 209,571 199,740 Interest 18 82Dividends 82,814 94,259 Rental income 3,592 4,077 Royalties 2,987 2,161 Net GST received 10,681 10,209 Other revenue 1,670 47,452

Total cash received 371,518 431,909

Cash usedEmployees 14,583 14,578 Grants 5,006,975 2,810,415 Subsidies paid 210,825 193,482 Suppliers 147,288 134,625 Payments to corporate Commonwealth entities 122,547 116,180

Total cash used 5,502,218 3,269,280 Net cash (used by) operating activities (5,130,700) (2,837,371)

INVESTING ACTIVITIESCash received

Repayments of advances and loans 3,503 5,240 Interest 30,251 30,715 Proceeds from sales of property, plant and equipment 2 -

Total cash received 33,756 35,955

Cash usedAdvances and loans made 617,213 250,000 Purchase of property, plant and equipment 25,212 15,623 Purchase of land and buildings 2,526 2,234 Investments 123,000 21,000

Total cash used 767,951 288,857 Net cash (used by) investing activities (734,195) (252,902)

Net (decrease) in cash held (5,864,895) (3,090,273)


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2017 2016Notes $'000 $'000

Cash and cash equivalents at the beginning of the reporting period 7,765 1,978

Cash from Official Public AccountAppropriations 6,244,568 3,461,588 Special Accounts 68,497 77,278

Total cash used from official public account 6,313,065 3,538,866

Cash to official public accountAppropriations (313,262) (365,528)Special Accounts (68,497) (77,278)

Total cash to official public account (381,759) (442,806)

Cash and cash equivalents at the end of the reporting period 4.1A 74,176 7,765


Budget Variances Commentary

Administered Schedule of Comprehensive Income

Expenses

Employee expenses are under budget by $4.0 million or 22% mainly due to the increased use of contractors and Service Delivery Agreements to deliver services in the Indian Ocean Territories.

Supplier expenses are over budget by $14 million or 11% mainly due to:(a) subsequent budget revisions and reclassifications for the delivery of services on Norfolk Island from

1 July 2016; and(b) a $5 million payment reclassified from Departmental expenses for environmental management costs

associated with the Western Sydney Airport.

The Department’s subsidy programs are demand driven. The variance of $38 million or 16% reflects a slower than anticipated uptake of the expansion of the Tasmanian Freight Equalisation Scheme.

Grant expenses are over budget by $815 million mainly as a result of a Determination by the Treasurer to bring forward Financial Assistance Grants from 2017-18.

Depreciation and amortisation expenses are over budget by $23 million or 76% due to revaluations and reassessment of asset useful lives at 30 June 2016, recognised after estimates for 2016-17 were prepared.

Write-down and impairment of assets mainly reflects the write-down of land at Moorebank NSW as a result of entering into a finance lease for nominal consideration with the Moorebank Intermodal Company Ltd (MICL) (see Note 2.1E).

Concessional loan expenses are under budget by $31 million or 21% due to changes in the drawdown schedule and present value calculations for the WestConnex loan and re-measurement of the Norfolk Island Runway loan.

The protection of the sea levy payment is subject to annual advice on contributions required to International Oil Pollution Compensation Funds.

Income

Other taxes are over budget by $2.7 million or 7% mainly due a land tax equivalent payment received from MICL.

Revenue from the sale of goods and services is over budget by $3.0 million mainly due to increased sales of sand at Jandakot WA and increased revenue for services provided in the Indian Ocean Territories.

115



No payments were made through the Building Australia Fund Special Account during 2017. Estimated receiptsin the original budget were subsequently incorporated into the Infrastructure Investment Program.

Industry contributions are under budget by $0.9 million or 42% due to less costs recovered for Airport Environment Officers than budgeted.

Revenue from fees and fines are under budget by $8.5 million or 4% mainly due to less Interstate Road Transport fees and Marine Navigation levies collected than budgeted.

Dividend revenue is under budget by $15 million or 15% due to a lower dividend than budgeted received from the Australian Rail Track Corporation and no dividends received from Airservices Australia.

Other revenue is under budget by $9.8 million due to the deferral of land acquisitions associated with the proposed Melbourne Airport expansion into 2017-18. The budgeted revenue includes amounts payable by the operators of Melbourne Airport to meet the costs incurred by the Commonwealth associated with theacquisitions.

Other gains are over budget due to the recognition of assets acquired for nominal consideration and a reduction in the impairment allowance for the Norfolk Island Runway Loan corresponding to the re-measurement of the loan.Administered Schedule of Assets and Liabilities

Cash and cash equivalents reflect a drawdown of funds on 30 June 2017 to meet payments on the following business day and the reclassification of special account balances held in the Official Public Account from receivables to cash equivalents.

Investments are under budget by $224 million or 4% mainly due to a budgeted equity payment for the OakajeePort Common User Facility through the Building Australia Fund which did not occur.

Non-financial assets are over budget by $403 million or 64% mainly due to the revaluation of land at Badgerys Creek (revalued at 30 June 2016 and 30 June 2017) and buildings and infrastructure on Christmas Island (revalued at 30 June 2016). The variance also includes grant prepayments of $11 million which were not budgeted.

Payables are over budget by $15 million or 43% due to the timing of end of year accruals.

Provisions are over budget by $0.4 million or 6% mainly due to the timing of expenses associated with the rehabilitation of land on Christmas Island affected by phosphate mining.


ent 116

DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTNOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

Overview1. Financial Performance

1.1 Expenses 1.2 Own-Source Revenue and Gains

2. Income and Expenses Administered on Behalf of Government

2.1 Administered – Expenses 2.2 Administered – Income

3. Financial Position

3.1 Financial Assets 3.2 Non-Financial Assets

3.3 Payables 3.4 Other Provisions

4. Assets and Liabilities Administered on Behalf of Government

4.1 Administered – Financial Assets 4.2 Administered – Non-Financial Assets

4.3 Administered – Payables 4.4 Administered – Other Provisions

5. Funding

5.1 Appropriations 5.2 Special Accounts 5.3 Regulatory Charging Summary 5.4 Net Cash Appropriation Arrangements

6. People and Relationships

6.1 Employee Provisions 6.2 Key Management Personnel Remuneration

6.3 Related Party Disclosures 7. Managing Uncertainties

7.1 Contingent Assets and Liabilities 7.2 Financial Instruments 7.3 Administered – Financial Instruments 7.4 Fair Value Measurement 7.5 Administered – Fair Value Measurement

8. Other Information

8.1 Assets Held in Trust

8.2 Restructuring

117



Overview

The Basis of Preparation of the Financial Statements

The financial statements are general purpose financial statements and are required by section 42 of the Public Governance, Performance and Accountability Act 2013.

The financial statements have been prepared in accordance with:

a) Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR) for reporting periodsending on or after 1 July 2015; and

b) Australian Accounting Standards and Interpretations – Reduced Disclosure Requirements issued by the AustralianAccounting Standards Board (AASB) that apply for the reporting period.

The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. The financial statements are presented in Australian dollars.

New Australian Accounting Standards

The Department has adopted Tier 2 Reduced Disclosure Requirements in accordance with the FRR and AASB 1053 –Application of Tiers of Australian Accounting Standards. Reduced Disclosure Requirements have been adopted for the first time in the 2016-17 financial year.

One new standard was issued prior to the signing of the Statement by the Secretary and Chief Financial Officer, which was applicable to the current reporting period and had a material effect on the entity’s financial statements:

Standard/Amendment Nature of change in accounting policy and adjustment to financial statements

AASB 2015-6Amendments to Australian Accounting Standards –Extending Related Party Disclosures to Not-for-Profit Public Sector EntitiesEffective 1 July 2016

The amendment extends the scope of AASB 124 Related Party Disclosures to not-for-profit public sector entities, but provides relief for transactions between related entities controlled by the same government. The amendment requires disclosure of significant transactions with other Australian Government entities, the extent of collectively significant transactions with other Australian Government entities and any transactions with key management personnel. These disclosures have been made at Notes 6.2 and 6.3.

Taxation

The Department is exempt from all forms of taxation except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST). Revenues, expenses, assets and liabilities are recognised net of GST except where:

a) the amount of GST incurred is not recoverable from the Australian Taxation Office; and

b) for receivables and payables.

Reporting of administered activities

Administered revenues, expenses, assets, liabilities and cash flows are disclosed in the administered schedules and related notes.

Except where otherwise stated, administered items are accounted for on the same basis and using the same policies as for departmental items, including the application of Australian Accounting Standards.

Revenue is recognised when it is probable that the economic benefit comprising the consideration will flow to the Government and it can be reliably measured.

Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the relevant asset.

Dividend revenue is recognised when the right to receive a dividend has been established.


ent 118


Events After the Reporting Period

Departmental

On 18 July 2017, the Prime Minister announced the Government would establish a Home Affairs portfolio of immigration, border protection and domestic security and law enforcement agencies, including the Office of Transport Security. The arrangements are expected to be implemented from early 2018. The impact on the Department’s financial statements for 2017-18, including potential machinery of government changes affecting the Office of Transport Security, cannot be quantified at this stage.

Administered

As part of the 2017-18 Budget, the Australian Government announced it would establish a new corporate Commonwealth entity, WSA Co Limited, to develop and operate the new Western Sydney Airport at Badgerys Creek NSW. WSA Co Limited was established on 7 August 2017. The Australian Government’s investment in WSA Co Limited will be reported as an Administered investment in Note 4.1D.

As part of the 2017-18 Budget, the Australian Government also announced it would provide an additional $8.4 billion in equity to the Australian Rail Track Corporation Ltd (ARTC) to deliver the Inland Rail project from Brisbane to Melbourne. An Equity Funding Agreement between Shareholder Ministers is being established to detail the payment mechanism and terms and conditions of funding. The additional equity is likely to increase the fair value of the Australian Government’s investment in ARTC in the future (see Note 4.1D).

119



1. Financial PerformanceThis section analyses the financial performance of the Department for the year ended 30 June 2017.1.1 Expenses

2017 2016$'000 $'000

1.1A: Employee benefitsWages and salaries 97,798 98,881 Superannuation

Defined contribution plans 8,049 7,940 Defined benefit plans 11,228 12,861

Leave and other entitlements 11,116 14,718 Separation and redundancies 1,824 1,691 Other employee expenses 3,350 3,146 Total employee benefits 133,365 139,237

1.1B: SuppliersGoods and services supplied or rendered

Legal 10,395 12,203 Contracted services 23,457 18,330 Consultants 27,988 29,554 Contractors 11,882 12,204 Travel and accommodation 5,780 5,865 Communications 2,766 2,759 Property operating costs 7,166 7,599 Information technology services 3,643 2,972 Training and conferences 2,621 2,382 Other goods and services 5,350 5,314

Total goods and services supplied or rendered 101,048 99,182

Goods supplied 954 668Services rendered 100,094 98,514 Total goods and services supplied or rendered 101,048 99,182

Other suppliersOperating lease rentals 12,807 13,645 Workers compensation expenses 967 901Surplus lease space - 783

Total other suppliers 13,774 15,329 Total suppliers 114,822 114,511

Leasing Commitments

Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows:

Within 1 year 13,623 15,126 Between 1 to 5 years 50,848 48,169 More than 5 years 53,010 64,269

Total operating lease commitments 117,481 127,564


ent 120


Leasing CommitmentsThe Department, in its capacity as lessor/lessee, has entered into operating leases for office accommodation purposes. Most departmental leases contain a clause for fixed rate increases. These lease conditions vary and rent reviews are undertaken annually with increases determined by either: fixed percentage increases, increases in the Consumer Price Index or the outcome of local or national property market reviews. Operating leases are effectively non-cancellable.

The Department had commitments receivable for sublease rental income of $0.208 million (2016: $0.014 million).

2017 2016$'000 $'000

1.1C: GrantsLocal Governments - 52Non-profit organisations 357 830Total grants 357 882

1.1D: Finance costsUnwinding of discount 17 179Total finance costs 17 179

1.1E: Write-down and impairment of assetsImpairment of financial instruments 144 177Write-down of leasehold improvements 74 642Write-down other property, plant and equipment 67 54Impairment of intangible assets 188 53Total write-down and impairment of assets 473 926

Accounting Policy

Employee BenefitsAccounting policies for employee related expenses are contained in the People and Relationships section(Note 6.1).

LeasesThe Department had no finance leases in its capacity as lessee at 30 June 2017 (2016: Nil).

Operating lease payments are expensed on a straight line basis which is representative of the pattern of benefits derived from the lease arrangements.

Lease incentives taking the form of ‘free’ leasehold improvements and rent holidays are recognised as liabilities. These liabilities are reduced by allocating lease payments between rental expense and reduction of the liability over the life of the lease. Lease incentives are recognised as a reduction of rental expense over the lease term on a straight-line basis unless another systematic basis is more reflective of the time pattern of the lessee’s benefit.

Where leased premises are considered surplus, the operating rent has been brought to account in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets. The net present value of future net outlays in respect of surplus space under non-cancellable lease agreements is expensed in the period in which the space becomes surplus.

The Department makes an immediate allowance for property make-good where required under lease agreements.

Borrowing CostsAll borrowing costs are expensed as incurred.

121



1.2 Own-Source Revenue and Gains2017 2016$'000 $'000

Own-Source Revenue

1.2A: Sale of goods and rendering of servicesSale of goods 30 38Rendering of services 3,359 4,027 Total sale of goods and rendering of services 3,389 4,065

1.2B: Other revenueResources received free of charge

Remuneration of auditors 540 530Other 400 106Total other revenue 940 636

Gains

1.2C: Other gainsUnwinding of provision for surplus lease space 1,055 1,132 Reversal of lease liabilities - 9,304 Other 12 -Total other gains 1,067 10,436

1.2D: Revenue from GovernmentAppropriations

Departmental appropriations 248,457 261,691 Total revenue from Government 248,457 261,691

Accounting Policy

Revenue from the Sale of Goods or Rendering of ServicesRevenue from the sale of goods is recognised when:

a) the risks and rewards of ownership have been transferred to the buyer;b) the Department retains no managerial involvement or effective control over the goods;c) the revenue and transaction costs incurred can be reliably measured; andd) it is probable that the economic benefits associated with the transaction will flow to the Department.

Revenue from rendering of services is recognised by reference to the stage of completion of contracts at the reporting date. The revenue is recognised when:

a) the amount of revenue, stage of completion and transaction costs incurred can be reliably measured; andb) the probable economic benefits associated with the transaction will flow to the department.

The stage of completion of contracts at the reporting date is determined by reference to the proportion that costs incurred to date bear to the estimated total costs of the transaction.

Receivables for goods and services, which have 30 day terms, are recognised at the nominal amounts due less any impairment allowance account. Collectability of debts is reviewed at the end of the reporting period. Allowances are made when collectability of the debt is no longer probable.

Other Revenue

Resources Received Free-of-ChargeResources received free-of-charge are recognised as revenue when, and only when, a fair value can be reliably determined and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense. Resources received free-of-charge are recorded as either revenue or gains depending on their nature.


ent 122


Other Gains

Resources Received Free-of-Charge Contributions of assets at no cost of acquisition or for nominal consideration are recognised as gains at their fair value when the asset qualifies for recognition, unless received from another Government entity as a consequence of a restructuring of administrative arrangements (refer to Note 8.2).

Sale of AssetsGains and losses from disposal of assets are recognised when control of the assets has passed to the buyer.

Revenue from GovernmentAmounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the Department gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned. Appropriations receivable are recognised at their nominal amounts.

123



2.Income and Expenses Administered on Behalf of GovernmentThis section analyses the activities that the Department does not control but administers on behalf of the Government. Unless otherwise noted, the accounting policies adopted are consistent with those applied for departmental reporting.2.1 Administered – Expenses

2017 2016$'000 $'000

2.1A: Employee benefitsWages and salaries 10,498 10,631Superannuation

Defined contribution plans 1,456 1,321Defined benefit plans 87 149

Leave and other entitlements 845 1,580Other employee expenses 1,062 1,080Total employee benefits 13,948 14,761

2.1B: SuppliersGoods and services supplied or rendered

Service fees 31,213 23,767Services delivery arrangements 67,487 42,074Fuel and oil 11,259 11,388Rail and road research 10,374 7,990Medical supplies 4,360 4,149Property and operating costs 7,036 12,671Repairs and maintenance 5,642 5,550Professional services 498 9,132Travel and accommodation 467 518Information, communication and technology 1,407 1,727General expense 2,997 2,739Apprentice costs 348 296Other 149 124

Total goods and services supplied or rendered 143,237 122,125

Goods supplied 11,259 11,388Services rendered 131,978 110,737Total goods and services supplied or rendered 143,237 122,125

Other suppliersMinimum lease payments 175 294Workers compensation expenses 94 68

Total other suppliers 269 362

Total suppliers 143,506 122,487

Minimum lease payments relate to short-term residential and storage leases. There were no material commitments for these leases at 30 June 2017 (2016: Nil).

2.1C: SubsidiesSubsidies in connection with

Tasmanian Freight Equalisation Scheme 137,612 129,835Bass Strait Passenger Vehicle Equalisation Scheme 47,769 44,081Other subsidies 20,867 21,782

Total subsidies 206,248 195,698


ent 124


2017 2016$'000 $'000

2.1D: GrantsPublic sector

Australian Government entities (related parties) 407,725 387,398State and Territory Governments 47,357 53,040Local Governments 4,337,717 2,230,985

Private sectorNot-for-profit organisations 141,521 53,582Commercial entities 68,172 64,942Overseas 2,472 2,293

Total grants 5,004,964 2,792,240

2.1E: Write-down and impairment of assetsImpairment on financial assets 78 1,054Investment in Administration of Norfolk Island1 63,053 -Write-down of property, plant and equipment 280 680Write-down of land and buildings 466 -Write-down of finance leases2 361,461 -Total write-down and impairment of assets 425,338 1,734

1 The Administration of Norfolk Island (the Administration) was abolished on 1 July 2016. The functions of the Administration were either assumed by the Australian Government or transitioned to the Norfolk Island Regional Council which operates under the NSW Local Government framework. The write-down of the investment excludes a component that was reclassified to the Norfolk Island Heath and Residential Aged Care Service (see Note 4.1D).2 On 24 January 2017, land and associated assets at Moorebank NSW were leased to a subsidiary of the Moorebank Intermodal Company Ltd for 99 years. The lease has been classified as a finance lease. As the minimum lease payments are negligible, the lease is considered to have no reportable value and the carrying value of land and associated assets have been written down to nil. Land adjacent to Melbourne airport has also been written down following its incorporation into the airport lease (see Note 4.2A).

2.1F: Payments to corporate Commonwealth entitiesAustralian Maritime Safety Authority 65,716 58,650Civil Aviation Safety Authority 41,892 42,461National Transport Commission 3,358 3,301Infrastructure Australia 11,581 11,768Total payments to corporate Commonwealth entities 122,547 116,180

Accounting Policy

Grants and SubsidiesThe Department administers a number of grant and subsidy schemes on behalf of the Government. Grant and subsidy liabilities are recognised to the extent that (i) the services required to be performed by the grantee have been performed or (ii) the grant eligibility criteria have been satisfied, but payments due have not been made. When the Government enters into an agreement to make these grants and services but services have not been performed or criteria satisfied, this is considered a commitment.

Payments to corporate Commonwealth entitiesPayments to corporate Commonwealth entities from amounts appropriated for that purpose are classified as administered expenses, equity injections or loans of the relevant portfolio department. The appropriation to the Department is disclosed under the Funding section – Appropriations (Note – 5.1A).

Payments from the Building Australia FundPayments from the Building Australia fund (BAF) are reported as revenue and as grants expense. Payments are made through the Building Australia Fund Infrastructure Portfolio Special Account (Note 5.2A).

125



2.2 Administered – Income2017 2016$'000 $'000

Revenue

Taxation Revenue2.2A: Other taxesLevies 1,607 2,006 Tax equivalents 40,085 37,348 Total other taxes 41,692 39,354

Non-Taxation Revenue2.2B: Sale of goods and rendering of servicesSale of goods 1,329 2,274 Rendering of services 19,164 18,826 Total sale of goods and rendering of services 20,493 21,100

2.2C: Fees and finesOther fees from regulatory services 202,938 204,607 Fines 1,256 955Total fees and fines 204,194 205,562

2.2D: InterestLoans 40,582 30,243 Unwinding of discount - concessional loans 5,580 3,531 Other 18 82Total interest 46,180 33,856

2.2E: Other revenueRefund of previous years payments 170 373Insurance recoveries 557 691Other 717 892Rental income 3,002 4,722 Phosphate mine royalty 1,380 2,246 Total other revenue 5,826 8,924

2.2F: Other gainsRecognition of assets at fair value - Norfolk Island museum collections - 8,245 Recognition of assets at fair value - Melbourne Airport land 5,185 -Reversal of impairment of financial asset 6,361 -Recognition of other assets at fair value 227 2,697 Reversal of provision for asbestos removal - 171Revaluation increment - artworks - 76Total other gains 11,773 11,189


ent 126


Accounting Policy

RevenueAll administered revenues are revenues relating to ordinary activities performed by the Department on behalf of the Australian Government. As such, administered appropriations are not revenues of the Department that oversees distribution or expenditure of the funds as directed.

The main sources of administered revenue are:a) land tax equivalency payments for commercial use of Commonwealth owned land;b) provision of goods and services and other fees and charges in the Indian Ocean Territories, Jervis Bay

Territory and Norfolk Island;c) Airport Building Controller fees;d) Coastal Trading License fees;e) Marine Navigation levies;f) Protection of the Sea levies;g) Interstate Road Transport fees;h) motor vehicle and trailer identification plate fees;i) interest revenue on loans;j) dividend revenue from Australian government owned entities; andk) royalties and conservation levies associated with phosphate mining on Christmas Island.

InterestInterest revenue is recognised using the effective interest method.

127



3. Financial PositionThis section analyses the Department’s assets used to conduct its operations and the operating liabilities incurred as a result.Employee related information is disclosed in the People and Relationships section.3.1 Financial Assets

2017 2016$'000 $'000

3.1A: Cash and cash equivalentsCash on hand or on deposit 1,620 1,838 Other 230 300Total cash and cash equivalents 1,850 2,138

3.1B: Trade and other receivablesGoods and services receivables

Goods and services 602 923Total goods and services receivables 602 923

Appropriations receivableExisting programs 140,138 126,513

Total appropriations receivable 140,138 126,513

Other receivablesGST receivable from the Australian Taxation Office 3,375 2,615 Other receivables 145 89

Total other receivables 3,520 2,704 Total trade and other receivables (gross) 144,260 130,140 Less impairment allowance (234) (96)Total trade and other receivables (net) 144,026 130,044

Credit terms for goods and services were within 28 days (2016: 28 days).

3.1C: Reconciliation of the impairment allowance

Movements in relation to 2017

Goods and services

Other receivables Total

$'000 $'000 $'000As at 1 July 2016 96 - 96

Amounts recovered and reversed (6) - (6)Increase recognised in net cost of services 84 60 144

Total as at 30 June 2017 174 60 234

Movements in relation to 2016Goods and

servicesOther

receivables Total$'000 $'000 $'000

As at 1 July 2015 38 - 38Amounts recovered and reversed (119) - (119)Increase recognised in net cost of services 177 - 177

Total as at 30 June 2016 96 - 96


ent 128


2017 2016$'000 $'000

3.1D: Accrued revenueAccrued revenue 1,084 1,314 Total accrued revenue 1,084 1,314

Accounting Policy

Loans and ReceivablesTrade receivables, loans and other receivables that have fixed or determinable payments and that are not quoted in an active market are classified as ‘loans and receivables.’ Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate.

Impairment

All financial assets are assessed for impairment at the end of each reporting period. Where recovery of a financial asset is assessed as unlikely, an impairment allowance is made. If there is objective evidence that an impairment loss has been incurred for loans and receivables, the amount of the loss is measured as thedifference between the assets carrying amount and the present value of estimated future cash flows discounted at the asset’s original effective interest rate. The carrying amount is reduced by way of an impairment allowance. The loss is recognised in the Statement of Comprehensive Income.

129


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Contractual commitments for the acquisition of property, plant and equipment and intangible assets.At 30 June 2017, the Department had contractual commitments of $5.595 million for buildings (2016: Nil), $1.082 million for other property, plant and equipment (2016: Nil) and $1.510 million for intangible assets (2016: Nil). All contractual commitments relate to acquisitions in the 2017-18 financial year.

Accounting PolicyAssets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken. Financial assets are initially measured at their fair value plus transaction costs where appropriate.

Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and income at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements. In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor entity’s accounts immediately prior to the restructuring.

Asset Recognition ThresholdPurchases of property, plant and equipment are recognised initially at cost in the Statement of Financial Position, except for purchases costing less than $5,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to ‘make good’ provisions in property leases taken up by the Departmentwhere there exists an obligation to restore the property to its original condition. These costs are included in the value of the Department’s leasehold improvements with a corresponding provision for the ‘make good’ recognised.

RevaluationsFollowing initial recognition at cost, property, plant and equipment assets are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not differ materially from the assets’ fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.

Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation surplus except to the extent that it reverses a previous revaluation decrement of the same asset class that was previously recognised in the surplus/deficit. Revaluation decrements for a class of assets are recognised directly in the surplus/deficit except to the extent that they reverse a previous revaluation increment for that class.

Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset restated to the revalued amount.

DepreciationDepreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the Department using, in all cases, the straight-line method of depreciation.

Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate.

Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

2017 2016Buildings on freehold land 15 to 60 years 15 to 60 yearsLeasehold improvements Shorter of lease term or expected useful

economic lifeShorter of lease term or expected useful economic life

Plant and equipment 3 to 100 years 3 to 100 yearsDepartmental artworks 3 to 100 years 3 to 100 yearsAdministered artworks Indefinite IndefiniteOther Heritage and Cultural Indefinite Indefinite

Impairment All assets were assessed for impairment at 30 June 2017. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.

The recoverable amount of an asset is the higher of its fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of

131



an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the entity were deprived of the asset, its value in use is taken to be its depreciated replacement cost.

DerecognitionAn item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

IntangiblesThe Department's intangibles comprise internally developed software over $50,000 and purchased software for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses.

Software is amortised on a straight-line basis over its anticipated useful life. The useful lives of the entity's software are from 3 to 9 years (2016: 3 to 9 years). All software assets were assessed for indications of impairment as at 30 June 2017.

Accounting Judgements and Estimates

BuildingsBuildings represent the fair value of leasehold improvements in office leases and the related make goodrequirements. The fair value has been taken to be the depreciated replacement cost as determined by an independent qualified valuer as at 30 June 2016, adjusted for subsequent depreciation. The Department has assessed that the carrying value of these assets continue to approximate their fair value at 30 June 2017.

Other property, plant and equipment assets

The fair value of other property, plant and equipment assets has been taken to be the depreciated replacement cost as determined by an independent qualified valuer as at 31 March 2017. The valuer advised there were no material changes in the fair value of these assets at 30 June 2017.

2017 2016$'000 $'000

3.2B: Other non-financial assetsPrepayments 3,744 3,345 Lease incentive assets 251 366Total other non-financial assets 3,995 3,711

No indicators of impairment were found for other non-financial assets.


ent 132


3.3 Payables2017 2016$'000 $'000

3.3A: SuppliersTrade creditors 2,885 963Accrued expenses 20,037 15,812 Operating lease rentals 670 587Total suppliers 23,592 17,362

Settlement was usually made within 30 days.

3.3B: Other payablesUnearned revenue 49 135Lease incentives 1,226 724Wages and salaries 828 364Superannuation 146 80Separations and redundancies 465 153Other 347 317Total other payables 3,061 1,773

3.4 Other Provisions

Provision for restoration

Provision for surplus lease

space

Provision for legal

costs Total$'000 $'000 $'000 $'000

As at 1 July 2016 1,208 1,728 422 3,358 Amounts used (395) (1,055) - (1,450)Reversal and other movements 17 1 (123) (105)

Total as at 30 June 2017 830 674 299 1,803

The Department had eight agreements at 30 June 2017 (2016: ten) for the lease of office premises which have provisions requiring the Department to restore the premises to their original condition at the conclusion of the lease. The Department has made a provision to reflect the present value of these obligations.

The Department holds several leases for office accommodation that include components that are surplus to its requirements. The Department sub-leases this space where possible. Where the space cannot be sub-leased, or the sub-lease is a lesser value than the head lease, the Department has recognised a provision for the present value of the net future lease payments.


Surplus Lease SpaceThe measurement of the surplus lease space provision is based on discounted cash flows for the remaining term the space is expected to be surplus, less any sub-lease revenue.

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4.Assets and Liabilities Administered on Behalf of GovernmentThis section analyses assets and liabilities that the Department does not control but administers on behalf of the Government. Unless otherwise noted, the accounting policies adopted are consistent with those applied for departmental reporting.4.1 Administered – Financial Assets

2017 2016$'000 $'000

4.1A: Cash and cash equivalentsCash on hand or on deposit 65,905 -Cash in special accounts 8,271 7,765 Total cash and cash equivalents 74,176 7,765

4.1B: Trade and other receivablesAdvances and loans

Commercial entities 517,807 -State and Territory Governments 1,042,018 1,047,823

Total advances and loans 1,559,825 1,047,823

Other receivablesFees 2,616 5,969 Other revenue 10 372GST receivable from Australian Taxation Office 3,123 2,091

Total other receivables 5,749 8,432 Total trade and other receivables (gross) 1,565,574 1,056,255

Less impairment allowanceAdvances and loans (3,681) (9,306)Other receivables (396) (1,086)

Total impairment allowance (4,077) (10,392)Total trade and other receivables (net) 1,561,497 1,045,863

4.1C: Reconciliation of the impairment allowance

Movements in relation to 2017Advances and loans


2017 2017 2017$'000 $'000 $'000

As at 1 July 2016 9,306 1,086 10,392 Amounts written off - (32) (32)Increase/(Decrease) recognised in net cost of service (5,625) (658) (6,283)

Total as at 30 June 2017 3,681 396 4,077

Movements in relation to 2016Advances and loans


2016 2016 2016$'000 $'000 $'000

As at 1 July 2015 8,854 487 9,341 Amounts written off - (3) (3)Increase/(Decrease) recognised in net cost of service 452 602 1,054

Total as at 30 June 2016 9,306 1,086 10,392


ent 134


2017 2016$'000 $'000

4.1D: InvestmentsInvestments accounted for using the net assets methodAustralian Government authorities

National Transport Commission 573 571Australian Maritime Safety Authority 199,380 181,755 Civil Aviation Safety Authority 66,648 59,317 Infrastructure Australia 3,760 3,494

Australian Government companiesMoorebank Intermodal Company Limited 104,895 52,031

Australian Government controlled entitiesAdministration of Norfolk Island - 64,131 Norfolk Island Health and Residential Aged Care Service 1,787 -

Total Investments accounted for using the net assets method 377,043 361,299

Investments accounted for using the discounted cashflow methodAustralia Government authorities

Airservices Australia 897,506 504,000 Australian Government companies

Australian Rail Track Corporation Limited 3,502,000 3,456,400 Total Investments accounted for using the discounted cashflow method 4,399,506 3,960,400 Total Investments 4,776,549 4,321,699

4.1E: Accrued revenueLevies, fees and fines 10,309 12,253 Total accrued revenue 10,309 12,253

Accounting Policy

Loans and Receivables

Credit terms for goods and services were within 30 days (2016: 30 days).

Loans to Australian States and Territories and commercial entities were made for periods ranging from 8 to 118years. No security is generally required. Interest rates are fixed. Interest payments are due on the last day of each financial year for loans to States and Territories. Interest payments on the commercial loan are capitalised for the first twelve years and are due quarterly thereafter.

Where loans and receivables are not subject to concessional treatment, they are carried at amortised cost using the effective interest method. Gains and losses due to impairment, derecognition and amortisation are recognised through profit or loss.

Administered Investments

Administered investments in subsidiaries, joint ventures and associates are not consolidated because their consolidation is relevant only at the Whole of Government level.

Administered investments other than those held for sale are classified as available-for-sale and are measured at their fair value as at 30 June 2017. Fair value has been determined using the Australian Government’s proportional interest in the net assets of the entities as at end of reporting period or a discounted cash flow valuation.

The Department has a 100 per cent interest in the following entities. The principal activities of each of the administered investments are as follows:

1. Airservices Australia – provides safe, secure and environmentally responsible air navigation and aviationrescue and firefighting services for the aviation industry.

2. Australian Maritime Safety Authority (AMSA) – provides maritime safety and other services to theAustralian maritime industry, aviation and maritime search and rescue and marine environment protectionservices.

135



3. Civil Aviation Safety Authority (CASA) – regulates the safety of civil air operations in Australia andAustralian registered aircraft operating outside Australian territory.

4. Australian Rail Track Corporation Limited (ARTC) – operates and manages over 8,500 kilometres ofstandard gauge rail track in South Australia, Victoria, Western Australia, New South Wales andQueensland. ARTC has been tasked by the Australian Government to deliver the Inland Rail project.

5. Moorebank Intermodal Company Limited (MICL) – facilitates the development of an intermodal freightterminal at Moorebank NSW - a nationally significant infrastructure project that will help Sydney managethe expected growth in freight moving through the city.

6. Infrastructure Australia (IA) – advises governments, investors and infrastructure owners on a wide range ofissues including Australia’s current and future infrastructure needs, policy and regulation and their impacton investment and on the efficiency of the delivery, operation and use of national infrastructure networks.

7. Norfolk Island Health and Residential Aged Care Service (NIHRACS) – delivers health and aged careservices to the Norfolk Island community. NIHRACS transitioned from the Norfolk Island HospitalEnterprise on 1 July 2016 and is considered to be controlled by the Australian Government for financialreporting purposes.

The Department holds a 35 per cent interest in the National Transport Commission (NTC) which advises the Transport and Infrastructure Council on uniform regulatory and operational policies and model legislation for road, rail and intermodal transport.

The Administration of Norfolk Island (ANI) was controlled by the Australian Government for the period 18 June 2015 to 30 June 2016 and was responsible for the provision of infrastructure and services to the community of Norfolk Island. The ANI was abolished on 1 July 2016 and its functions were either assumed by the Australian Government or transitioned to the Norfolk Island Regional Council which operates under the NSW Local Government framework.


Loans and Receivables

Concessional loans are initially recognised at their fair value. If the rate of interest charged is lower than the counterparty’s borrowing rate (for non-government loans) the difference between the amortised cost and the fair value of the loan is treated as an expense.

WestConnex Stage 2 concessional loan

Advances and loans to commercial entities comprise a concessional loan facility provided to a subsidiary of the Sydney Motorway Corporation for construction of Stage 2 of the WestConnex Motorway in Sydney. The loan facility comprises multiple advances over several years of up to $2 billion. The first advance was made on 22 July 2016.

The fair value of each advance is determined using the present value of expected cash inflows, discounted at the prevailing market interest rate. The prevailing market interest rate is fixed for each advance to be consistent with the fixed interest rate in the loan facility agreement. As the loan facility is the first to be made by the Australian Government for a major road project, no comparable products have been identified in the marketand the prevailing market interest rate was determined based on external valuation advice.

The Department selected the mid-point from the range of market interest rates recommended by the valuer.The range was based on loans considered to have a similar risk profile including other commercial debt obtained by the Sydney Motorway Corporation, private sector toll road operators, regulated utilities and other entities that operate major infrastructure assets in a public/private partnership context.

As the market interest rate is the key determinant of the fair value of the loan, the Department undertook a sensitivity analysis to determine the impact of using the valuer’s highest and lowest interest rates which varied by 0.79%. This analysis confirmed that using different interest rates within the recommended range would not materially impact on the loan value over the term of the loan. The largest percentage variances occur in the early years of the loan with a 4.8% increase using the lowest rate in the range and a 4.4% decrease using the highest rate, in loan value at 30 June 2017. The variances decline over time and fall below 3% by 2021-22.

The loan facility also includes mandatory repayment of principal and/or interest in certain circumstances. No allowance for these repayments had been made at 30 June 2017 as there are no indicators that these circumstances will arise.

Administered Investments

In the absence of an observable market value for administered investments, the Department is required to use an appropriate valuation technique to determine fair value. The use of discounted cash flows is the preferred method for those entities that generate significant non-government cash inflows if the cash flows can be reliably predicted.


ent 136


NTC, AMSA, CASA, IA, and NIHRACS do not generate significant non-government cash inflows. The Department uses the net assets method of valuation for these entities. The fair value of the ANI was also determined using the net assets method.

MICL has not generated significant non-government cash inflows to date and has been reliant on equity funding from the Australian Government. Therefore the Department has determined that the net assets method of valuation remains the most appropriate estimate of fair value for MICL as at 30 June 2017.

Airservices Australia generates significant non-government cash inflows, and its cash flows have been demonstrated to be able to be reliably predicted. The fair value for Airservices Australia has been determined based on independent valuation advice using a discounted cash flow method.

ARTC generates significant non-government cash inflows. Due to the nature of its operations and assets there are no readily comparable market examples for fair value determination purposes. The Department has estimated the fair value using a discounted cash flow method with reference to the valuation of ARTC’s property, plant and equipment, modified for cash flows associated with its other asset and liability categories. As the ARTC’s property, plant and equipment represents a substantial proportion of its total assets, and is valued using discounted cash flows and the ARTC weighted average cost of capital, this method provides a reasonable basis for determination of fair value.

Confirmations of audit cleared net assets as at reporting date are obtained from each of the relevant organisations to support the reported figures.

137


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Land, buildings and other property, plant and equipment that met the definition of a heritage and cultural item are disclosed in the heritage and cultural asset class.

No impairment losses were recognised on buildings in 2017 (2016: Nil). An impairment loss of $0.170 million was recognised for other property, plant and equipment in 2017 (2016: Nil).

Revaluations of non-financial assets All revaluations were conducted in accordance with the revaluation policy at Note 3.2A. An independent valuer conducted a revaluation of the administered land asset class as at 30 June 2017.

Contractual commitments for the acquisition of property, plant and equipment and intangible assetsAt 30 June 2017, the Department had contractual commitments of $0.014 million for buildings (2016: Nil) and $7.735 million for other property, plant and equipment (2016: Nil). Contractual commitments relate to acquisitions in the 2017-18 and 2018-19 financial years.

Accounting Policy

Administered artworks and other heritage and cultural assets

The Administered artworks asset class comprises paintings and other artworks by Sir Sidney Nolan (Nolan collection) with an aggregated value of $33.6 million (2016: $33.6 million), along with several artworks held on Norfolk Island. The Nolan collection is maintained by the Canberra Museum and Gallery (CMAG), an ACT Government entity, on behalf of the Commonwealth. Curatorial and preservation arrangements are managed in accordance with a Memorandum of Understanding between CMAG and the Department. The collection is deemed to have an indefinite useful life.

The Other heritage and cultural assets class comprises assets that are held and/or used primarily for purposes that relate to their historical or cultural significance. They include:a) buildings, ruins, reserves and collections on Norfolk Island of historical significance with an aggregated

value of $72.82 million (2016: $72.82 million). The conservation and preservation of these assets aremanaged in accordance with the Kingston and Arthur’s Vale Historic Area Heritage Management Plan2016;

b) memorials, reserves and temples on Christmas Island with an aggregated value of $0.6 million (2016: $0.6million); and

c) historic aircraft with an aggregated value of $8.3 million (2016: $8.3 million) on display at Brisbane Airport,Adelaide Airport and the Queen Victoria Museum and Gallery in Launceston, Tasmania. The conservationand preservation of each aircraft is managed through an agreement with the relevant entity.

All assets in the class are deemed to have indefinite useful lives.

Curatorial and preservation policies for these assets are developed and monitored by qualified personnel and include the following:a) a clearly stated objective about the holding and preservation of items;b) a well-developed plan to achieve the objective, including demonstration of how the policy will be

implemented based on advice by appropriately qualified experts;c) monitoring procedures; andd) periodic reviews.

Administered Intangibles

Administered intangibles include internally developed software, purchased software and phosphate mining lease rights on Christmas Island. The useful lives of Administered intangibles are from 1 to 21 years (2016: 1 to 21 years).

Software assets are carried at cost less accumulated amortisation and accumulated impairment losses.

Following initial recognition at cost, phosphate mining lease rights are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses.


Land

The fair value of land administered on behalf of the Australian Government has been taken to be the market value of similar assets as determined by an independent qualified valuer at 30 June 2017. The fair value of individual land parcels is considered representative of their highest and best use and the fundamental assumption that they could be sold on a freehold basis.

139



Buildings and other property, plant and equipment

The fair value of buildings and other property, plant and equipment assets has been taken to be either the market value or depreciated replacement cost of similar assets as determined by an independent qualified valuer at 30 June 2016. The Department assessed that the carrying value of these assets continued to approximate their fair value as at 30 June 2017.

Artworks and museum collections

The fair value of artworks and other collections administered on behalf of the Australian Government havebeen taken to be the market value of similar assets as determined by an independent qualified valuer. High value items are valued on an individual basis. The fair value of museum collections comprising a large number of similar artefacts were valued based on a stratified multi-stage sampling basis.

Land and structures at Australian Government owned airports and the Moorebank Logistics Park

The land and structures at 21 civilian airports owned by the Australian Government and leased to private sector interests are subject to lease arrangements with an initial lease term of 50 years and a 49-year extension option exercisable by the lessees. Consideration consisted of upfront payments by the lessees, without any subsequent lease payments being payable, including in the event of the exercise of the lease extension option.These leases have been assessed as having no reportable fair value because of the extended period before any future revenue stream will accrue.

Land owned by the Australian Government at Moorebank NSW has been leased to a subsidiary of the Moorebank Intermodal Company Ltd for 99 years for a nominal annual rental to develop an intermodal freight terminal. The lease has been assessed as having no reportable fair value as the present value of minimum lease payments is negligible.

2017 2016$'000 $'000

4.2B: InventoriesInventories held for distribution 2,277 2,717 Total inventories 2,277 2,717

4.2C: PrepaymentsGrant prepayments 11,260 3,245 Other prepayments - 5,913 Total prepayments 11,260 9,158

No indicators of impairment were found for other non-financial assets.

Accounting Policy

Inventories

During 2017, $8.7 million (2016: $6.7 million) of inventory held for distribution was recognised as an expense.

All inventories are expected to be sold or distributed in the next 12 months.

Inventories held for sale are valued at the lower of cost and net realisable value.

Inventories held for distribution are valued at cost, adjusted for any loss of service potential.

Costs incurred in bringing each item of inventory to its present location and condition are assigned as follows:

a) raw materials and stores – purchase cost on a first in-first out basis; and

b) finished goods and work-in-progress – cost of direct materials and labour plus attributable costs thatcan be allocated on a reasonable basis.

Inventories acquired at no cost or nominal consideration are initially measured at current replacement cost at the date of acquisition.


ent 140


4.3 Administered – Payables2017 2016$'000 $'000

4.3A: SuppliersTrade creditors and accruals 12,320 12,010 Total suppliers 12,320 12,010

Settlement was usually made within 30 days.

4.3B: SubsidiesSubsidies in connection with

External parties 8,196 12,773 Total subsidies 8,196 12,773

4.3C: GrantsAustralian Government entities 17,846 21,267 Local Governments 9,178 271Non-profit organisations 440 607Other 2,086 1,374 Total grants 29,550 23,519

Settlement was due according to the terms and conditions of each grant within 30 days of performance eligibility.

4.3D: Other payablesSalaries and wages 81 39Superannuation 11 5Other 244 163Total other payables 336 207

4.4 Administered – Other Provisions

Asbestos Removal

Phosphate Mine

Rehabilitation Total$’000 $’000 $’000

As at 1 July 2016 142 2,950 3,092 Amounts used - (880) (880)Amounts reversed 4 849 853

Total as at 30 June 2017 146 2,919 3,065

Accounting Policy

Other ProvisionsInstances of materials containing asbestos have been identified in buildings owned by the Australian Government that are administered by the Department. Provision has been made where the Department has apresent obligation to take reasonable action to remediate the risk of harmful exposure to employees and the public. The timing of this remediation depends on the condition and extent of each item of asbestos containing material.

The Australian Government also has an obligation to rehabilitate land on Christmas Island affected by phosphate mining.Accounting Judgements and Estimates

Provisions for Asbestos Removal and Phosphate Mine RehabilitationThe provision for asbestos removal is based on estimates of future obligations relating to the underlying assets.

The provision for phosphate mine rehabilitation is equal to the balance of the Christmas Island Phosphate Mining Rehabilitation Special Account, adjusted for accrued payments and revenue at year end.

141


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0$'

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$'00

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0D

epar

tmen

tal

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inar

y an

nual

ser

vice

s26

5,76

7 20

,628

28

6,39

5 (2

60,7

20)

25,6

75C

apita

l Bud

get4

11,4

91

-11

,491

(6

,519

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972

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l dep

artm

enta

l27

7,25

8 20

,628

29

7,88

6 (2

67,2

39)

30,6

47A

dmin

iste

red

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inar

y an

nual

ser

vice

sC

apita

l Bud

get4

24,5

55

-24

,555

(2

8,06

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,514

)A

dmin

iste

red

item

s1,

084,

826

-1,

084,

826

(738

,868

)34

5,95

8

Pay

men

ts to

cor

pora

te C

omm

onw

ealth

ent

ities

123,

005

-12

3,00

5 (1

23,0

05)

-O

ther

ser

vice

sS

tate

s, A

CT,

NT

and

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l gov

ernm

ent

836,

395

-83

6,39

5 (8

22,6

65)

13,7

30

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inis

tere

d as

sets

and

liab

ilitie

s20

6,75

8 -

206,

758

(740

,213

)(5

33,4

55)

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l adm

inis

tere

d2,

275,

539

-2,

275,

539

(2,4

52,8

20)

(177

,281

)

1.D

epar

tmen

tal a

ppro

pria

tions

of $

17.3

milli

on h

ave

been

with

held

(und

er S

ectio

n 51

of t

he P

GP

A A

ct)f

or a

dmin

istra

tive

purp

oses

due

to c

hang

es in

Wes

tern

Syd

ney

Airp

ort

proj

ect p

riorit

ies.

Adm

inis

tere

d ap

prop

riatio

ns o

f $38

3.8

milli

on w

ere

also

with

held

, com

pris

ing

$300

.8 m

illion

in O

rdin

ary

annu

al s

ervi

ces

and

$83

mill

ion

in A

dmin

iste

red

asse

ts a

nd li

abilit

ies,

mai

nly

due

to th

e m

ovem

ent o

f fun

ds b

etw

een

year

s. A

n ad

ditio

nal a

mou

nt o

f $42

.2 m

illion

was

als

o w

ithhe

ld fr

om 2

015-

16 a

dmin

iste

red

appr

opria

tions

dur

ing

the

year

.2.

PG

PA

Act

Sec

tion

74 re

ceip

ts.

3.Th

e va

rianc

e in

Dep

artm

enta

land

Adm

inis

tere

d or

dina

ry a

nnua

l ser

vice

s ap

prop

riatio

ns a

rem

ainl

y du

e to

am

ount

s w

ithhe

ld u

nder

Sec

tion

51 o

f the

PG

PA

Act

(see

not

e 1

abov

e).

The

varia

nce

in th

e A

dmin

iste

red

Cap

ital B

udge

t is

due

to th

e re

allo

catio

n of

$3.

1 m

illion

from

ord

inar

y an

nual

ser

vice

s an

d dr

awdo

wns

from

prio

r yea

rap

prop

riatio

ns.

The

varia

nce

in A

dmin

iste

red

asse

t and

liab

ilitie

s is

mai

nly

due

to a

dvan

ces

paid

und

er th

e W

estC

onne

x co

nces

sion

al lo

an w

hich

wer

e ap

prop

riate

d in

2015

-16.

4.D

epar

tmen

tal a

nd A

dmin

iste

red

Cap

ital B

udge

ts a

re a

ppro

pria

ted

thro

ugh

App

ropr

iatio

n A

cts

(No.

1,3,

5).

The

y fo

rm p

art o

f ord

inar

y an

nual

ser

vice

s, a

nd a

reno

tse

para

tely

iden

tifie

d in

the

App

ropr

iatio

n A

cts.


ent 142

DEP

AR

TMEN

T O

F IN

FRAS

TRU

CTU

RE

AN

DR

EGIO

NA

L D

EVEL

OPM

ENT

NO

TES

TO A

ND

FO

RM

ING

PA

RT

OF

THE

FIN

AN

CIA

L ST

ATE

MEN

TS

5.1A

: Ann

ual A

ppro

pria

tions

('R

ecov

erab

le G

STex

clus

ive'

) (co

ntin

ued)

Ann

ual a

ppro

pria

tions

for 2

016

Tota

l app

ropr

iatio

n

App

ropr

iatio

n ap

plie

d in

201

6 (c

urre

nt a

nd p

rior

year

s)V

aria

nce3

Ann

ual

App

ropr

iatio

n1A

djus

tmen

ts to

appr

opria

tion2

$'00

0$'

000

$'00

0$'

000

$'00

0D

epar

tmen

tal

Ord

inar

y an

nual

ser

vice

s26

3,50

4 8,

999

272,

503

(243

,386

)29

,117

C

apita

l Bud

get4

3,20

1 -

3,20

1 (6

,982

)(3

,781

)To

tal d

epar

tmen

tal

266,

705

8,99

9 27

5,70

4 (2

50,3

68)

25,3

36

Adm

inis

tere

dO

rdin

ary

annu

al s

ervi

ces

Cap

ital B

udge

t416

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-

16,7

61

(17,

856)

(1,0

95)

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inis

tere

d ite

ms

1,07

8,96

3 -

1,07

8,96

3(6

47,1

35)

431,

828

Pay

men

ts to

cor

pora

te C

omm

onw

ealth

ent

ities

116,

180

-11

6,18

0(1

16,1

80)

-O

ther

ser

vice

sS

tate

s, A

CT,

NT

and

Loca

l gov

ernm

ent

1,02

7,63

4 -

1,02

7,63

4(1

,010

,286

)17

,348

A

dmin

iste

red

asse

ts a

nd li

abilit

ies

2,31

0,00

0 -

2,31

0,00

0(2

71,0

00)

2,03

9,00

0 To

tal a

dmin

iste

red

4,54

9,53

8 -

4,54

9,53

8(2

,062

,457

)2,

487,

081

1.$3

81.7

milli

on h

as b

een

with

held

(Sec

tion

51 o

f the

PG

PA

Act

) mai

nly

due

to th

e ap

prov

al o

f mov

emen

t of f

unds

and

real

loca

tions

.2.

PG

PA

Act

Sec

tion

74 re

ceip

ts o

f $10

.812

milli

on le

ss P

GP

A A

ct S

ectio

n 75

tran

sfer

s of

$1.

813

milli

on.

3.Th

e va

rianc

e in

the

Adm

inis

tere

d as

sets

and

liab

ilitie

s ap

prop

riatio

nsre

pres

ents

am

ount

s pr

ovid

ed fo

r the

Wes

tCon

nex

Sta

ge 2

con

cess

iona

l loa

n w

hich

is e

xpec

ted

to b

epa

id o

ver t

he n

ext t

hree

yea

rs.

No

draw

dow

ns a

gain

st th

e lo

an h

ad o

ccur

red

at 3

0 Ju

ne 2

016.

4.D

epar

tmen

tala

nd A

dmin

iste

red

Cap

ital B

udge

ts a

re a

ppro

pria

ted

thro

ugh

App

ropr

iatio

n A

cts

(No.

1, 3

, 5).

The

y fo

rm p

art o

f ord

inar

y an

nual

ser

vice

s, a

nd a

reno

tse

para

tely

iden

tifie

d in

the

App

ropr

iatio

n A

cts.

143



5.1B: Unspent Annual Appropriations ('Recoverable GST exclusive')

2017 2016Departmental $'000 $'000Appropriation Act (No.1) 2014-151,2 14,007 14,007 Appropriation Act (No.1) - Departmental Capital Budget 2014-153 - 867Appropriation Act (No.1) 2015-16 1,306 102,291 Appropriation Act (No.1) - Departmental Capital Budget 2015-164 - 3,201Appropriation Act (No.3) 2015-16 916 20,154Appropriation Act (No.1) 2015-16 Unspent Cash - 2,138Supply Act (No.1) 2016-17 75,767 -Appropriation Act (No.1) 2016-171 70,419 -Supply Act (No.1) -Departmental Capital Budget (DCB)-Non Operating 2016-175 3,866 -Appropriation Act (No.1) - Departmental Capital Budget 2016-176 5,174 -Appropriation Act (No.1) 2016-17 Unspent Cash 1,850 -Total departmental 173,305 142,658

AdministeredAppropriation Act (No.1) 2014-151,2 118,634 118,634Appropriation Act (No.2) 2014-15 (Payments to States, ACT, NT & local govt)1,2 67,750 67,750Appropriation Act (No.3) 2014-151,2 21,566 21,566Appropriation Act (No.1) 2015-161 437,866 443,775Appropriation Act (No.1) 2015-16 - Administered Capital Budget 2015-164 1,682 2,057Appropriation Act (No.2) 2015-16 (Administered Assets and Liabilities) 1,236,034 2,000,000Appropriation Act (No.3) 2015-161 26,816 26,816Appropriation Act (No.4) 2015-16 (Payments to States, ACT, NT & local govt)1 16,348 17,348Appropriation Act (No.4) 2015-16 (Administered Assets and Liabilities) 54,000 54,000Supply Act (No.1) 2016-17 373 -Appropriation Act (No.1) 2016-171 308,927 -Supply Act (No.2) 2016-17 (Administered Assets and Liabilities) 35,417 -Supply Act (No.2) 2016-17 (Payments to States, ACT, NT & local govt) 1,000 -Appropriation Act (No.2) 2016-17 (Administered Assets and Liabilities) 18,691 -Appropriation Act (No.2) 2016-17 (Payments to States, ACT, NT & local govt) 5,412 -Appropriation Act (No.3) 2016-171 39,430 -Appropriation Act (No.4) 2016-17 (Payments to States, ACT, NT & local govt) 8,318 -Appropriation Act (No.4) 2016-17 (Administered Assets and Liabilities)1 110,650 -Appropriation Act (No.2) 2015-16 (Administered Assets and Liabilities) – Unspent Cash8 65,753Total administered 2,574,667 2,751,946

1. Includes amounts withheld under PGPA Act s51.2. 2014-15 appropriations lapsed on 1 July 2017 in accordance with the provisions in the appropriation acts.3. This item was appropriated as part of Appropriation Act (No.1) 2014-154. This item was appropriated as part of Appropriation Act (No.1) 2015-165. This item was appropriated as part of Supply Act (No.1) 2016-176. This item was appropriated as part of Appropriation Act (No.1) 2016-177. This item was appropriated as part of Appropriation Act (No.3) 2016-178. Represents an amount drawn on 30 June 2017 for payment on 3 July 2017


ent 144


5.1C: Special Appropriations ('Recoverable GST exclusive')

Authority

Appropriation applied2017 2016

Type $'000 $'000Protection of the Sea (Oil Pollution Compensation Fund) Act 1993 - section 40(4)

Unlimited amount 394 -

Interstate Road Transport Act 1985 - section 22 Unlimited amount 71,003 64,108

Australian Maritime Safety Authority Act 1990, section 48 Unlimited amount 120,228 115,900

Aviation Fuel Revenues (Special Appropriation) Act 1988 Unlimited amount 120,994 123,659

Sydney Airport Demand Management Act 1997 -section 27(4)

Limited amount - -

Australian National Railways Commission Sale Act 1997 -section 67AH(4)

Limited amount - -

Infrastructure Australia Amendment Act 2014 -Schedule 2, section 9(3)

Limited amount - 4,342

Public Governance, Performance and Accountability Act 2013– section 77

Refund provisions 817 258

Local Government (Financial Assistance) Act 1995 -section 19

Unlimited amount 3,472,151 1,144,188

Total special appropriations applied 3,785,587 1,452,455

145


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AR

TMEN

T O

F IN

FRAS

TRU

CTU

RE

AN

DR

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NA

L D

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ENT

NO

TES

TO A

ND

FO

RM

ING

PA

RT

OF

THE

FIN

AN

CIA

L ST

ATE

MEN

TS

5.2

Spec

ial A

ccou

nts

5.2A

: Spe

cial

Acc

ount

s ('R

ecov

erab

le G

ST e

xclu

sive

')

Inte

rsta

te R

oad

Tran

spor

t A

ccou

nt1

BA

F In

fras

truc

ture

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rtfo

lio S

peci

al

Acc

ount

2

Serv

ices

toO

ther

Ent

ities

an

d Tr

ust

Mon

eys3

Chr

istm

as Is

land

Ph

osph

ate

Min

ing

Reh

abili

tatio

n Sp

ecia

l Acc

ount

20

064

Chr

istm

as Is

land

Ph

osph

ate

Min

ing

Reh

abili

tatio

n Sp

ecia

l Acc

ount

20

165

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an O

cean

Te

rrito

ries

Spec

ial A

ccou

nt6

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is B

ayTe

rrito

rySp

ecia

l A

ccou

nt7

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bour

ne

Airp

ort

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way

La

nd A

cqui

sitio

n Sp

ecia

l Acc

ount

8

2017

2016

2017

2016

2017

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2016

2017

2016

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739

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390

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ent 146

DEP

AR

TMEN

T O

F IN

FRAS

TRU

CTU

RE

AN

DR

EGIO

NA

L D

EVEL

OPM

ENT

NO

TES

TO A

ND

FO

RM

ING

PA

RT

OF

THE

FIN

AN

CIA

L ST

ATE

MEN

TS1.

App

ropr

iatio

n:P

ublic

Gov

erna

nce,

Per

form

ance

and

Acc

ount

abili

ty A

ct 2

013;

sec

tion

80. E

stab

lishi

ng in

stru

men

t: In

ters

tate

Roa

d Tr

ansp

ort A

ct 1

985;

sec

tion

21. P

urpo

se: T

opr

ovid

e fo

r pay

men

ts to

the

Sta

tes

and

Terr

itorie

s fo

r mai

nten

ance

and

upk

eep

of ro

ads

from

regi

stra

tion

char

ges

rece

ived

from

veh

icle

s en

gage

d in

inte

rsta

te tr

ade

and

com

mer

ce.

2.A

ppro

pria

tion:

Pub

lic G

over

nanc

e, P

erfo

rman

ce a

nd A

ccou

ntab

ility

Act

201

3; s

ectio

n 80

. Est

ablis

hing

inst

rum

ent:

Nat

ion-

build

ing

Fund

s Ac

t 200

8; s

ectio

n 61

. Pur

pose

: To

mak

epa

ymen

ts in

rela

tion

to th

e cr

eatio

n or

dev

elop

men

t of t

rans

port

and

infra

stru

ctur

e.3.

App

ropr

iatio

n: P

ublic

Gov

erna

nce,

Per

form

ance

and

Acc

ount

abili

ty A

ct 2

013;

sec

tion

78. E

stab

lishi

ng in

stru

men

t: Fi

nanc

ial M

anag

emen

t and

Acc

ount

abili

ty (E

stab

lishm

ent o

fS

peci

al A

ccou

nt fo

r Dep

artm

ent o

f Inf

rast

ruct

ure

and

Tran

spor

t) D

eter

min

atio

n 20

11/0

8. P

urpo

se: E

xpen

ditu

re o

f mon

ey te

mpo

raril

y he

ld in

trus

t or o

ther

wis

e fo

r the

ben

efit

of a

pers

on o

ther

than

the

Com

mon

wea

lth.

4.A

ppro

pria

tion:

Pub

lic G

over

nanc

e, P

erfo

rman

ce a

nd A

ccou

ntab

ility

Act

201

3; s

ectio

n 78

. Est

ablis

hing

inst

rum

ent:

Fina

ncia

l Man

agem

ent a

nd A

ccou

ntab

ility

Det

erm

inat

ion

2006

/11

- Chr

istm

as Is

land

Pho

spha

te M

inin

g R

ehab

ilita

tion

Spe

cial

Acc

ount

Est

ablis

hmen

t 200

6; s

ectio

n 78

. Pur

pose

: To

man

age

the

fund

ing

prov

ided

for t

he re

habi

litat

ion

ofph

osph

ate

min

esi

tes

on C

hris

tmas

Isla

nd in

acc

orda

nce

with

the

requ

irem

ents

of t

he le

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147


DEPARTMENT OF INFRASTRUCTURE AND REGIONAL DEVELOPMENTNotes to and forming part of the financial statements

5.3 Regulatory Charging Summary2017 2016$'000 $'000

Amounts appliedDepartmental

Annual appropriations 12,451 13,171 Administered

Special appropriations (including special accounts) 120,228 115,900 Total amounts applied 132,679 129,071

ExpensesDepartmental 12,642 13,342 Administered 119,902 115,471

Total expenses 132,544 128,813

External RevenueDepartmental 31 38Administered 129,733 126,619

Total external revenue 129,764 126,657

Amounts written offAdministered - 1

Total amounts written off - 1

Regulatory charging activities:- Environment protection at Leased Federal Airports- Coastal trading licences- Motor vehicle safety standards- Australian Maritime Safety Authority levies

Documentation (Cost Recovery Impact Statement) for Building Control and Environmental Protection at Leased Federal Airports and Coasting Trade Permits is available at: http://www.infrastructure.gov.au/department/statements/2005_2006/budget/pdf/CRIS-MINOR_ARRANGEMENTS.pdf

Documentation (Cost Recovery Impact Statement) for Vehicle Safety Standards is available at: http://www.infrastructure.gov.au/department/statements/2005_2006/budget/pdf/CRIS-VEHICLE_SAFETY_STANDARDS.pdf

Documentation (Cost Recovery Impact Statement) for Australian Maritime Safety Authority Levies is available at: https://www.amsa.gov.au/vessels/levies-fees-charges/documents/CRIS2016.pdf

5.4 Net Cash Appropriation Arrangements2017 2016$'000 $'000

Total comprehensive income/(loss) less depreciation/amortisation expenses previously funded through revenue appropriations1 3,618 36,491 Plus: depreciation/amortisation expenses previously funded through revenue appropriation (9,253) (12,236)Total comprehensive income/(loss) - as per the Statement of Comprehensive Income (5,635) 24,255

1. From 2010-11, the Government introduced net cash appropriation arrangements, where revenueappropriations for depreciation/amortisation expenses ceased. Entities now receive a separate capital budgetprovided through equity appropriations. Capital budgets are to be appropriated in the period when cashpayment for capital expenditure is required.


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6. People and RelationshipsThis section describes a range of employment and post-employment benefits provided to our people and our relationships with other key people.6.1 Employee Provisions

2017 2016$'000 $'000

6.1A: Employee provisionsLeave 45,001 46,184 Total employee provisions 45,001 46,184

6.1B: Administered employee provisionsLeave 3,477 3,863 Total employee provisions 3,477 3,863

Accounting Policy

Liabilities for ‘short-term employee benefits’ (as defined in AASB 119 Employee Benefits) and termination benefits expected within twelve months of the end of the reporting period are measured at their nominal amounts.

Other long term employee benefits are measured as the net total of the present value of the defined benefit obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.

LeaveThe liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non-vesting.

The leave liabilities are calculated on the basis of employees' remuneration at the estimated salary rates that will be applied at the time the leave is taken, including the Department's employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.

The liability for long term benefits is determined by reference to the work of an actuary. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

Separation and RedundancyProvision is made for separation and redundancy benefit payments. The Department recognises a provision for termination when it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.

SuperannuationThe Department’s staff are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS), the PSS accumulation plan (PSSap) or other superannuation funds held outside the Australian Government.

The CSS and PSS are defined benefit schemes for the Australian Government. The PSSap is a defined contribution scheme.

The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course. This liability is reported in the Department of Finance’s administered schedules and notes.

The Department makes employer contributions to the employees’ defined benefit superannuation schemes at rates determined by an actuary to be sufficient to meet the current cost to the Government. The Department accounts for the contributions as if they were contributions to defined contribution plans.

The liability for superannuation recognised as at 30 June represents outstanding contributions for the final pay fortnight of the reporting period.


Employee provisions have been calculated based on the Department’s specific probability and other factors as determined by the Australian Government Actuary as at 31 December 2015. The Department has assessed that these factors remain relevant as at 30 June 2017.

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6.2 Key Management Personnel Remuneration

Key management personnel (KMP) are those persons having authority and responsibility for planning, directing and controlling the activities of the Department, directly or indirectly. The Department has determined KMP to be Portfolio Ministers, the Secretary, Deputy Secretaries and the Chief Operating Officer. KMP remuneration is reported in the table below:

2017 2016$'000 $'000

Short-term employee benefits 1,478 1,363 Post-employment benefits 266 352Other long-term employee benefits 250 351Total key management personnel remuneration expenses1 1,994 2,066

The total number of KMP included in the above table are 5 (2016: 7)2.

1. Remuneration is reported on an accrual basis and excludes short term acting arrangements. Remunerationexcludes the remuneration and other benefits of Portfolio Ministers. The Portfolio Ministers’ remuneration andother benefits are set by the Remuneration Tribunal and are not paid by the Department.

2. The Department had four KMP positions in 2017 (2016: four). The total number of KMP above includesemployees occupying KMP positions for part of the year.

6.3 Related Party Disclosures

Related party relationships:

The Department is an Australian Government controlled entity. Related parties to the Department are key management personnel (see Note 6.2 above), other Australian Government entities and the Norfolk Island Health and Residential Aged Care Service (see Note 4.1D).

Transactions with related parties:

The following transactions with related parties occurred during the financial year and are considered to be significant due to their size and/or nature:

Transaction Related party Note 2017$’000

Transfer of land and associated assets - Moorebank NSW

Department of Defence 4.2A 356,276

Lease of land - Moorebank1 Moorebank Intermodal Company Ltd 2.1E -

Equity payments Moorebank Intermodal Company Ltd 4.1D 42,000Australian Rail Track Corporation Ltd 4.1D 81,000

Service Delivery Agreement Norfolk Island Health and Residential Aged Care Service

2.1B 6,569

1. Land transferred from the Department of Defence was leased to the Moorebank Intermodal Company Ltd for99 years at a nominal annual rental, resulting in a write-down of $356.3 million in the carrying value of the landand associated assets (See Note 2.1E).

Other related party transactions with Australian Government entities include, but are not limited to:- Employer superannuation contributions, insurance premiums, information technology and communication

expenses and other whole of government payments (included in Notes 1.1A, 1.1B, 2.1A and 2.1B);- Legal services provided by the Australian Government Solicitor (included in Notes 1.1B and 2.1B);- Shared service arrangements provided to the Australian Transport Safety Bureau and Infrastructure Australia

(included in Note 1.2A);


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- Land tax equivalent payments received from the Moorebank Intermodal Company Ltd (included in Note 2.2A);- Recovery of costs from other Australian Government entities associated with functions in non self-governing

territories (included in Notes 2.2B, 2.2C and 2.2E);- Sub-lease arrangements (included in Note 1.1B);- Audit services provided free of charge by the Australian National Audit Office (Note 1.2B);- Grant administration services provided by the Department of Industry, Innovation and Science (included in

Note 1.2B);- Reimbursements paid to the Department of Foreign Affairs and Trade for costs incurred at overseas posts

(included in Note 1.2B);- Payments to other Australian Government entities in connection with services provided in non self-governing

territories (included in Note 2.1B);- Research and scoping studies paid to Geoscience Australia and the CSIRO (included in Note 1.2B);- Grant and other payments to corporate Commonwealth entities (included in Note 2.1D and Note 2.1F);- Grant payments to State and Territory Governments paid via the Treasury (included in Note 2.1D); and- Dividend receipts from the Australian Rail Track Corporation.

7. Managing UncertaintiesThis section analyses how the Department manages financial risks within its operating environment.7.1 Contingent Assets and Liabilities

7.1A: Contingent Assets and LiabilitiesClaims for damages or

costs Total2017 2016 2017 2016$'000 $'000 $'000 $'000

Contingent assetsBalance from previous period 266 - 266 -New contingent assets recognised - 266 - 266Assets realised (266) - (266) -

Total contingent assets - 266 - 266

Net contingent assets/(liabilities) - 266 - 266

Quantifiable ContingenciesInsurance claimsThe Department received proceeds from an insurance claim for storm damage and business interruption costs incurred in April 2015 at the Department’s Sydney offices.

7.1B: Administered - Contingent Assets and Liabilities

Claims for damages or costs Total

2017 2016 2017 2016$'000 $'000 $'000 $'000

Contingent assetsBalance from previous period 2,457 3,624 2,457 3,624 New contingent assets recognised 76 25 76 25Re-measurement (38) (501) (38) (501)Assets realised (557) (691) (557) (691)

Total contingent assets 1,938 2,457 1,938 2,457

Contingent liabilitiesBalance from previous period 11,195 10,614 11,195 10,614 Re-measurement 1,060 581 1,060 581

Total contingent liabilities 12,255 11,195 12,255 11,195 Net contingent assets/(liabilities) (10,317) (8,738) (10,317) (8,738)

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Quantifiable Administered Contingent AssetsInsurance claims have been submitted to recover business interruption costs on Christmas Island and damage to properties on Cocos (Keeling) Islands and the Jervis Bay Territory.

Quantifiable Administered Contingent LiabilitiesAsbestos Remediation costsAt 30 June 2017 the Department provided for asbestos remediation costs in the Schedule of Administered Assets and Liabilities where there is a present obligation to remediate and the cost of remediation can be reliably measured (see Note 4.4). The contingent liabilities in the table above have been recognised for properties in the Indian Ocean Territories and Jervis Bay Territory where asbestos management plans are in place and remediation may be required if conditions change, such as through damage or renovation.

Asbestos management plans are also in place for Commonwealth owned properties on Norfolk Island, but the cost of remediation for these properties if conditions change has not been quantified.

Unquantifiable Administered ContingenciesThe Department, on behalf of the Australian Government, has entered into the following indemnities and arrangements which are considered significant in nature and were disclosed in 2017-18 Budget Paper No.1 –Statement of Risks. The probability that the Department will incur costs as a result of these arrangements is considered remote and no claims have been identified at 30 June 2017.

Maritime Industry Finance Company Limited — Board Members’ IndemnityIndemnities for Maritime Industry Finance Company Limited (MIFCO) board members were provided to protect them against civil claims relating to their employment and conduct as Directors. MIFCO was placed into voluntary liquidation in November 2006 and was deregistered on 24 April 2008. The indemnity is not time limited and continues even though the company has been liquidated.

Moorebank Intermodal Terminal – IndemnitiesIndemnities have been provided in connection with the development of the Moorebank Intermodal Terminal, including:(a) Protection for the Directors and Officers of the Moorebank Intermodal Company Ltd (MICL) against civil

claims relating to their employment and conduct. The indemnities apply to the period of appointment asDirectors or Officers of the company;

(b) Costs that may be incurred by MICL in the event that the Commonwealth terminates the Equity FundingAgreement between the Commonwealth and MICL for reasons other than a breach by MICL;

(c) Costs and liabilities incurred by the private sector owner of the Glenfield Waste Site for any easement forthe rail spur across the Glenfield Waste Site, to the extent that such costs or liabilities are caused, orcontributed to, by the Commonwealth or its agents; and

(d) Costs and liabilities that may be incurred by the State of NSW arising under the Native Title Act 1993 (Cth)associated with the construction of a rail bridge over the Georges River to the Moorebank IntermodalTerminal.

Tripartite deeds relating to the sale of federal leased airportsThe tripartite deeds between the Australian Government, the airport lessee company and financiers, amend airport (head) leases to provide for limited step-in-rights for financiers in circumstances where the Australian Government terminates the head lease to enable the financiers to correct the circumstances that triggered such a termination event. The tripartite deeds may require the Australian Government to pay financiers compensation as a result of terminating the (head) lease, once all Australian Government costs have been recovered.

New South Wales Rural Fire Fighting Service - indemnityThe Jervis Bay Territory Rural Fires Ordinance 2014 (the Ordinance) provides the legislative basis for fire management services in the Jervis Bay Territory (JBT). Due to the cross-border delivery of fire services from NSW to the JBT, the Ordinance is based on the NSW Rural Fires Act 1997 and Rural Fires Regulations 2008with modifications to reflect the JBT’s jurisdictional and administrative circumstances. Under this mechanism, the NSW Rural Fire Service (NSW RFS) is the sole fire management service provider. To provide this service, the NSW RFS requires the Australian Government to provide an uncapped indemnity whereby the Australian Government would be liable for any damages, arising in good faith, from the provision of the agreed scope of fire management services. The likelihood of an event occurring that may result in a liability for the Australian Government has been assessed as remote. Risks are mitigated through the training and professional qualifications of NSW RFS staff and the establishment and enforcement of a robust legislative framework for JBT fire management.


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In the normal course of operations, the Australian Maritime Safety Authority (AMSA) is responsible for the provision of funds necessary to meet the clean-up costs arising from ship-sourced marine pollution and, in all circumstances, is responsible for making appropriate efforts to recover the costs of any such incidents. The Australian Government meets costs that cannot be recovered from such incidents. It is not possible to estimate the amounts of any eventual payments that may be required in relation to these incident costs. AMSA has established a pollution response reserve of $10 million supported by a commercial line of credit of $40 million to provide funding should the overall clean-up costs exceed the liability limit of the ship owner.

Underwriting of air services – External TerritoriesUnderwriting agreements are in place for the provision of air services to Norfolk Island and the Indian Ocean Territories. The extent of any claim is recognised as a liability once the amount is verified, can be reliably measured and settlement is probable.

Service Delivery Arrangement Indemnities — Indian Ocean Territories and Norfolk IslandA range of services are delivered to the Indian Ocean Territories under Service Delivery Agreements (SDAs) with approximately forty Western Australian (WA) Government entities. The Australian Government has provided certain indemnities for the WA Government, their respective officers, agents, contractors and employees against civil claims relating to their employment and conduct as officers.

Similar arrangements are in place with the NSW Government for service delivery arrangements on Norfolk Island.

The likelihood of an event occurring that may result in a liability for the Australian Government has been assessed as remote and the risks are currently mitigated through the training and professional qualifications ofthe staff of these agencies.

Accounting Policy

Contingent Assets and Contingent LiabilitiesContingent assets and contingent liabilities are not recognised in the Statement of Financial Position orAdministered Schedule of Assets and Liabilities but are reported in the notes. They may arise from uncertainty as to the existence of a liability or asset or represent an asset or liability in respect of which the amount cannotbe reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain and contingent liabilities are disclosed when settlement is greater than remote.

Financial Guarantee ContractsFinancial guarantee contracts are accounted for in accordance with AASB 139 Financial Instruments:Recognition and Measurement. They are not treated as a contingent liability, as they are regarded as financial instruments outside the scope of AASB 137 Provisions, Contingent Liabilities and Contingent Assets.


Indemnities and/or guaranteesThe maximum amounts payable under the indemnities given is disclosed above. At the time of completion ofthe financial statements, there was no reason to believe that the indemnities and/or guarantees would be called upon, and no recognition of any liability was therefore required.

Australian Maritime Safety Authority Incident Costs

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7.2 Financial Instruments2017 2016$'000 $'000

7.2A: Categories of Financial InstrumentsFinancial AssetsLoans and receivables

Cash and cash equivalents 1,850 2,138 Trade receivables 428 827Accrued revenue 1,084 1,314

Total loans and receivables 3,362 4,279 Total financial assets 3,362 4,279

Financial LiabilitiesFinancial liabilities measured at amortised cost

Trade creditors 2,885 963Accrued expenses 20,037 15,812

Total financial liabilities measured at amortised cost 22,922 16,775 Total financial liabilities 22,922 16,775

The carrying value of financial assets and liabilities is a reasonable approximation of fair value.

7.2B: Net Gains or Losses on Financial AssetsLoans and receivables

Impairment 144 177Net losses on loans and receivables 144 177Net losses on financial assets 144 177

There was no income or expense associated with financial liabilities during the financial year.

Accounting Policy

Financial assets

The Department classifies its financial assets in the following categories:

a) available-for-sale financial assets; and

b) loans and receivables.

The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. Financial assets are recognised and derecognised upon trade date. Assets in these categories are classified as current assets.

Effective Interest Method

Income is recognised on an effective interest rate basis.

Available-for-Sale Financial AssetsAvailable-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories.

Available-for-sale financial assets are recorded at fair value. Gains and losses arising from changes in fair value are recognised directly in reserves (equity) with the exception of impairment losses. Interest is calculated using the effective interest method and foreign exchange gains and losses on monetary assets are recognised directly in profit or loss. Where the asset is disposed of or is determined to be impaired, part (or all) of the cumulative gain or loss previously recognised in the reserve is included in the surplus or deficit for the period.

Loans and receivables

Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as ‘loans and receivables’. Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised using the effective interest rate.


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Impairment of Financial Assets

Financial assets are assessed for impairment at the end of each reporting period.

Available for sale financial assets – If there is objective evidence that an impairment loss on an available-for-sale financial asset has been incurred, the amount of the difference between its cost, less principal repayments and amortisation, and its current fair value, less any impairment loss previously recognised in expenses, is transferred from equity to the Statement of Comprehensive Income.

Loans and receivables – If there is objective evidence that an impairment loss has been incurred for loans and receivables, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the asset’s original effective interest rate. The carrying amount is reduced by way of an allowance account. The loss is recognised in the Statement of Comprehensive Income.

Financial Liabilities

Financial liabilities are classified as ‘other financial liabilities’. Financial liabilities are recognised and derecognised upon ‘trade date’.

Other Financial Liabilities

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. These liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.

Supplier and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).

All payables are expected to be settled within 12 months except where indicated.

7.3 Administered – Financial Instruments2017 2016$'000 $'000

7.3A: Categories of Financial InstrumentsFinancial AssetsLoans and receivables

Cash and cash equivalents 65,905 -Loans to state and territory governments 1,556,144 1,038,517 Other receivables - fees receivable 1,833 2,446 Accrued revenue 3,285 3,259

Total loans and receivables 1,627,167 1,044,222

Available-for-sale financial assetsInvestments 4,776,549 4,321,699

Total available-for-sale financial assets 4,776,549 4,321,699 Total financial assets 6,403,716 5,365,921

Financial LiabilitiesFinancial liabilities measured at amortised cost

Trade creditors and accruals 12,320 12,010 Subsidies payable 8,196 12,773 Grants payable 29,550 23,519

Total financial liabilities measured at amortised cost 50,066 48,302 Total financial liabilities 50,066 48,302

The carrying value of financial assets and liabilities is a reasonable approximation of fair value.

155



2017 2016$'000 $'000

7.3B: Net Gains and Losses on Financial AssetsLoans and receivables

Interest revenue 46,162 33,774 Impairment (56,770) (1,054)

Net gains on loans and receivables (10,608) 32,720

Available-for-sale financial assetsDividend revenue 82,814 94,259

Gains/(losses) recognised in other comprehensive income 394,903 (266,440)

Net gains/(losses) on available-for-sale financial assets 477,717 (172,181)Net gains/(losses) on financial assets 467,109 (139,461)

There was no income or expense associated with financial liabilities during the financial year.

7.4 Fair Value Measurement7.4A: Fair Value Measurement

Fair value measurements at the end of the reporting period

2017 2016$'000 $'000

Non-financial assetsLand and Buildings 19,919 20,773 Property, plant and equipment 5,768 7,007

Total non-financial assets 25,687 27,780 Total fair value measurements of assets in the statement of financial position 25,687 27,780

7.5 Administered – Fair Value Measurement7.5A: Fair Value Measurement

Fair value measurements at the end of the reporting period

2017 2016$'000 $'000

Financial assetsInvestments accounted for using the net assets method 377,043 361,299 Investments accounted for using the discounted cashflow method 4,399,506 3,960,400

Total financial assets 4,776,549 4,321,699

Non-financial assetsLand 407,048 233,858 Buildings 133,098 155,721 Artworks 33,662 33,662 Other heritage and cultural 81,235 81,119 Other property, plant and equipment 355,848 358,688 Intangibles - Phosphate mine leases 4,999 6,249

Total non-financial assets 1,015,890 869,297Total fair value measurements of assets in the statement of financial position 5,792,439 5,190,996


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Accounting Policy

Fair Value MeasurementsThe Department deems transfers between levels of the fair value hierarchy to have occurred at the date of the event or change in circumstances that caused the transfer.

The fair value of investments accounted for using the net asset method is based on advice from each entity on their net asset position at the end of the reporting period.

The fair value of investments accounted for using the discounted cash flow method comprise Airservices Australia and the Australian Rail Track Corporation (ARTC). The fair value of the investment in Airservices Australia was based on advice from a valuation expert using a discounted cash flow method. The fair value of the investment in ARTC was determined in accordance with the policies, judgements and estimates reported in Note 4.1.

The fair value of non-financial assets was determined based on advice from valuation experts. The experts provided written assurance to the Department that the model used to value the assets was in compliance with AASB 13 and represents their highest and best use.

8. Other Information8.1 Assets Held in Trust

Monetary assetsMonetary assets held in trust are also disclosed in Note 5.2A - Special Accounts in the tables titled 'Services for Other Entities and Trust Moneys.' The Trust accounts are for monies received from other Government and non-agency bodies, or monies which are required to be held in trust for the benefit of a person other than the Commonwealth.

These monies are not available for other purposes of the Department and are not recognised in the financial statements.

2017 2016$'000 $'000

Services to Other Entities and Trust Monies - Department of Infrastructure and Regional DevelopmentAs at 1 July 227 279

Receipts 20 -Payments (1) (52)

Total as at 30 June 246 227Total assets held in trust 246 227

The Department had no non-monetary assets held in trust as at 30 June 2017 (2016: Nil).

8.2 Restructuring8.2A: Departmental Restructuring

2017 2016Office of Northern

Australia1

$'000 $'000FUNCTION RELINQUISHEDAssets relinquished

Trade and other receivables - 296Total assets relinquished - 296

Liabilities relinquishedEmployee provisions - 296

Total liabilities relinquished - 296Net assets/(liabilities) relinquished - -

1. As a result of changes to Administrative Arrangements Orders, responsibility for the Office for NorthernAustralia was transferred to the Department of Industry, Innovation and Science on 22 October 2015.

157



8.2B: Administered Restructuring

2017 2016

Administration of Norfolk Island1

$'000 $'000FUNCTIONS ASSUMEDAssets recognised

Land and buildings - 6,851 Other property, plant and equipment - 473

Total assets recognised - 7,324

Assets relinquishedLand and buildings - 5,361 Other property, plant and equipment - 64

Total assets relinquished - 5,425 Net assets recognised - 1,899

On 24 January 2017 land and associated assets at Moorebank NSW with a carrying value of $356.3 million were transferred from the Department of Defence. The transfer was recognised as a contribution by owners through equity (see Note 4.2A).

1 Administration of Norfolk Island (2016)On 18 June 2015, the Norfolk Island Legislative Assembly and Executive Council were abolished following amendments to the Norfolk Island Act 1979. The Australian Government assumed control of the Administration of Norfolk Island (the Administration) as an interim arrangement

On 1 July 2016, responsibility for health and aged care and education on Norfolk Island were assumed by the Australian Government. The Administration was replaced by the Norfolk Island Regional Council (Regional Council) which assumed responsibility for local government functions.

To give effect to the new governance arrangements, the then Minister for Territories, Local Government and Major Projects signed an Instrument under the Norfolk Island Land Transfer Ordinance 2016 to transfer assets between the Australian Government and the Administration. The transfers were effective from 28 June 2016

As a result of these transfers, the Department assumed administered assets associated with the Norfolk Island Police Station, Hospital and School. Assets associated with Regional Council functions, including parks, reserves and roads, were transferred to the Administration (and subsequently to the Regional Council from 1 July 2016).

7 APPENDICES


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Appendix A: Entity resource statements and expenses for outcomesTable A.1 Entity resource statement

Actual1 available

appropriationPayments

madeBalance

remaining

2016–17 $’000

2016–17 $’000

2016–17 $’000

Departmental annual appropriations - ordinary annual services2 Departmental resourcing3 440,256 266,951 173,305 - other services - non-operating Prior year appropriations available - - -Total departmental resourcing 440,256 266,951 173,305

Administered annual appropriations4 - ordinary annual services2

Outcome 1 244,004 109,107 Outcome 2 597,796 257,705 Outcome 3 738,397 250,803 Outcome 4 144,849 121,250 Administered Capital Budget5 29,752 28,069 Payments to corporate entities6 123,005 123,005

- other services - non-operating7 Prior year appropriations available 2,054,000 Administered assets and liabilities 206,758 805,966

- other services - specific payments to states, ACT, NT and local governmentOutcome 1 913,040 815,077 Outcome 3 41,636 7,588

Total available administered annual appropriations 5,093,237 2,518,570

Administered special appropriations Total available administered special appropriations 3,785,592

Special accounts Opening balance 7,764 Appropriation receipts8 74,230 Non-appropriation receipts to special accounts9 24,085

Adjustments (2,834) Payments made 92,468

Total available special accounts 103,245 92,468 10,777 continued...

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Actual1 available

appropriationPayments

madeBalance

remaining

2016–17 $’000

2016–17 $’000

2016–17 $’000

Total administrered resourcing 5,196,482 6,396,630

Less appropriations drawn from annual or special appropriations above and credited to special accounts and/or payments to corporate entities through annual appropriations

(197,235) (215,473)

Total net resourcing and payments 5,439,503 6,448,108

Notes: 1 Figures in the table represent actual appropriations provided less any legally recognised reductions as outlined in Note 5.1B of the 2016–17 Financial Statements.

2 Appropriation Act (No. 1) 2016–17, Supply Act 1 2016–17 and Appropriation Act (No. 3) 2016–17. 3 Actual available appropriations for 2016–17 include prior year departmental appropriation and s74 relevant entity

receipts. 4 Actual available appropriations for 2016–17 include retained administered funds from previous years. 5 Administered capital budgets are not separately dentified in Appropriation Bill (No. 1) and form part of ordinary annual

services items. 6 ‘Corporate entities’ are corporate Commonwealth entities and Commonwealth companies as defined under the PGPA

Act. 7 Appropriation Act (No. 2) 2016–17, Supply Act 2 2016–17 and Appropriation Act (No. 4) 2016–17. 8 Appropriation receipts from departmental appropriation and special appropriations. 9 Non–Appropriation receipts from the Christmas Island Phosphate Mining Rehabilitation Special Account, Indian Ocean

Territories Special Account 2014, Jervis Bay Territory Special Account 2014 and the Melbourne Airport New Runway Land Acquisition Special Account.


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Table A.2 Expenses for Outcome 1: Improved infrastructure across Australia through investment in and coordination of transport and other infrastructure

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 1.1: Infrastructure investment

Administered expenses

Ordinary Annual Services (Appropriation Act No. 1 and No. 3) 111,983 109,079 (2,904)

Other Services (Appropriation Act No. 2) 815,077 815,159 82

Payments to corporate entities 11,581 11,581 -

Expenses not requiring appropriation in the Budget year2 468,157 468,642 485

Departmental expenses

Departmental appropriation3 31,441 31,935 494

s74 retained revenue receipts 340 342 2

Expenses not requiring appropriation in the Budget year4 1,763 1,753 (10)

Total for Program 1.1 1,440,342 1,438,491 (1,851)

Outcome 1 total 1,440,342 1,438,491 (1,851)

Outcome 1 totals by appropriation type



Other Services (Appropriation Act No. 2) 815,077 815,159 82







Total expenses for Outcome 1 1,440,342 1,438,491 (1,851)

Average staffing level (number) 171 173 2

Notes: 1 Full-year budget, including any subsequent adjustments made to the 2016–17 Budget. 2 Administered expenses not requiring appropriation in the Budget year are made up of expenses relating to prepayments

associated with prior year payments, accruals and other non-cash expenses. 3 Departmental appropriation includes ‘Ordinary annual services (Appropriation Act No. 1 and Supply Act 1)’. 4 Departmental expenses not requiring appropriation in the Budget year are made up of the operating surplus/deficit,

depreciation and amortisation expenses and other non-cash expense items.

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Table A.3 Expenses for Outcome 2: An efficient, sustainable, competitive, safe and secure transport system for all transport users through regulation, financial assistance and safety investigations

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 2.1: Transport security


Ordinary Annual Services (Appropriation Act No. 1 and No. 3) 997 147 (850)

Expenses not requiring appropriation in the Budget year2 - - -



s74 retained revenue receipts 1,119 1,056 (63)


Total for Program 2.1 67,757 66,658 (1,099)

Program 2.2: Surface transport



Special Appropriations 121,606 120,296 (1,310)

Special Accounts 71,002 67,602 (3,400)


Expenses not requiring appropriation in the Budget year2 (50) - 50



s74 retained revenue receipts 1,361 901 (460)

Expenses not requiring appropriation in the Budget year4 (439) 17 456


Program 2.3: Road safety


Ordinary Annual Services (Appropriation Act No. 1 and No. 3) 4,000 4,000 -

Expenses not requiring appropriation in the Budget year2 - (2) (2)




Expenses not requiring appropriation in the Budget year4 980 974 (6)

Total for Program 2.3 23,402 23,628 226

continued...


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Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 2.4: Air transport



Special Appropriations 122,000 121,402 (598)

Special Accounts 10,000 210 (9,790)


Expenses not requiring appropriation in the Budget year2 (94) 5,794 5,888


Departmental appropriation3 78,463 71,572 (6,891)


Expenses not requiring appropriation in the Budget year4 (2,126) (1,547) 579


Outcome 2 Total 908,622 854,458 (54,164)




Special Appropriations 243,606 241,698 (1,908)



Expenses not requiring appropriation in the Budget year2 (144) 5,792 5,936


Departmental appropriation3 173,017 166,668 (6,349)



Total expenses for Outcome 2 908,622 854,458 (54,164)

Average staffing level (number) 718 714 (4)

Notes: 1 Full-year budget, including any subsequent adjustments made to the 2016–17 Budget. 2 Administered expenses not requiring appropriation in the Budget year is made up of expenses relating to prepayments



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Table A.4 Expenses for Outcome 3: Strengthening the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities; and providing grants and financial assistance

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 3.1: Regional development

Administered expensesOrdinary Annual Services (Appropriation Acts No. 1 and No. 3) 263,741 249,333 (14,408)Other Services (Appropriation Acts No. 2, and No. 4) 21,318 7,256 (14,062)Expenses not requiring appropriation in the Budget year2 - - -

Departmental expensesDepartmental appropriation3 28,744 28,756 12 s74 retained revenue receipts 261 263 2 Expenses not requiring appropriation in the Budget year4 1,298 1,289 (9)


Program 3.2: Local government

Administered expensesSpecial Appropriations 3,472,156 3,472,947 791 Expenses not requiring appropriation in the Budget year2 (1) - 1

Departmental expensesDepartmental appropriation3 2,272 2,345 73 s74 retained revenue receipts 27 27 - Expenses not requiring appropriation in the Budget year4 126 125 (1)

Total for Program 3.2 3,474,580 3,475,444 864

Outcome 3 Total 3,789,942 3,762,341 (27,601)Outcome 3 totals by appropriation type

Administered expensesOrdinary Annual Services (Appropriation Acts No. 1 and No. 3) 263,741 249,333 (14,408)Other Services (Appropriation Acts No. 2, and No. 4) 21,318 7,256 (14,062)Special Appropriations 3,472,156 3,472,947 791 Expenses not requiring appropriation in the Budget year2 (1) - 1

Departmental expensesDepartmental appropriation3 31,016 31,101 85 s74 retained revenue receipts 288 290 2 Expenses not requiring appropriation in the Budget year4 1,424 1,414 (10)

Total expenses for Outcome 3 3,789,942 3,762,341 (27,601)






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Table A.5 Expenses for Outcome 4: Good governance in the Australian territories through the maintenance and improvement of the overarching legislative framework for self-governing territories, and laws and services for non-self-governing territories

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016-17 $’000

Program 4.1: Services to territories


Ordinary Annual Services (Appropriation Acts No. 1 and No. 3) 125,301 129,075 3,774


Expenses not requiring appropriation in the Budget year2 53,951 124,094 70,143





Total for Program 4.1 226,225 296,763 70,538

Outcome 4 Total 226,225 296,763 70,538



Ordinary Annual Services (Appropriation Acts No. 1 and No. 3) 125,301 129,075 3,774


Expenses not requiring appropriation in the Budget year2 53,951 124,094 70,143





Total expenses for Outcome 4 226,225 296,763 70,538





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Table A.6 Expenses for Outcome 1: Improved infrastructure across Australia through investment in and coordination of transport and other infrastructure

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 1.1: Infrastructure investment

Annual administered expenses2

Infrastructure Investment Program

‑ Investment3 111,496 109,194 (2,302)

‑ Roads to Recovery 815,500 815,460 (40)

Building our Future campaign 64 69 5

Moorebank Intermodal Company 356,276 356,276 -

WestConnex Stage 2 – provision of a concessional loan 111,881 111,881 -

Payments to corporate entities – Infrastructure Australia4 11,581 11,581 -

Program support 33,544 34,030 486

Total Program 1.1 expenses 1,440,342 1,438,491 (1,851)

Total Program expenses for Outcome 1 1,440,342 1,438,491 (1,851)

Notes: 1 Full-year budget, including any subsequent adjustments made to the 2016–17 Budget. 2 Excludes expenses relating to payments made to and through the states and territories by the Department of the

Treasury for the Infrastructure Investment Program (Black Spot projects, Bridges Renewal Program, Heavy Vehicle Safety and Productivity, Northern Australia — improving cattle supply chains and Northern Australia Road projects), Infrastructure Growth Package (New Investments, Black Spots projects and Western Sydney Infrastructure Plan) administered items.

3 Excludes expenses relating to payments made to and through the states and territories by the Department of the Treasury.

4 Relates to appropriation for corporate entities which is provided through the Department.


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Table A.7 Expenses for Outcome 2: An efficient, sustainable, competitive, safe and secure transport system for all transport users through regulation, financial assistance and safety investigations

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 2.1: Transport security

Annual administered expenses

Aviation security enhancements 997 147 (850)

‑ improving international aviation security 23 19 (4)

‑ regional passenger screening 974 128 (846)

Program support 66,760 66,511 (249)

Total Program 2.1 expenses 67,757 66,658 (1,099)

Program 2.2: Surface transport


Bass Strait Passenger Vehicle Equalisation Scheme 47,773 47,769 (4)

International Maritime Organization – contribution 276 277 1

National Heavy Vehicle Regulator 3,852 3,852 -

OECD Road Transport – contribution 46 46 -

Tasmanian Freight Equalisation Scheme 170,095 137,612 (32,483)

Payments to corporate entities – Australian Maritime Safety Authority2 65,716 65,716 -

Payments to corporate entities – National Transport Commission2 3,358 3,358 -

Other3 - - -

Special Appropriation expenses

Australian Maritime Safety Authority Act 19902 120,556 119,902 (654)

Protection of the Sea (Oil Pollution Compensation Fund) Act 1993 1,000 394 (606)

Special Account expenses

Interstate Road Transport fees (Interstate Road Transport Special Account) 71,002 67,602 (3,400)



Program 2.3: Road safety


keys2drive 4,000 4,000 -

Other3 - (2) (2)


Total Program 2.3 expenses 23,402 23,628 226

continued...

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Part 7: Appendices

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 2.4: Air transport


Airport Lessee Companies – reimbursement of parking fines 1,000 947 (53)

Hobart International Airport runway extension – contribution 22,000 22,000 -

International Civil Aviation Organization – contribution 2,149 2,149 -

Payment scheme for Airservices Australia’s en route charges 2,000 1,516 (484)

Regional Aviation Access 24,113 23,602 (511)

Sunshine Coast Airport concessional loan - - -

Sydney West Airport – site management 11,620 7,902 (3,718)

Payments to corporate entities – Civil Aviation Safety Authority2 41,892 41,892 -

Depreciation and amortisation 6 - (6)

Other3 - (80) (80)


Aviation Fuel Revenues (Special Appropriation) Act 19882 121,900 121,402 (498)


Melbourne Airport New Runway Land Acquisition Special Account 10,000 5,444 (4,556)

Program support 82,131 75,625 (6,506)


Total Program expenses for Outcome 2 908,622 854,458 (54,164)

Notes: 1 Full-year budget, including any subsequent adjustments made to the 2016–17 Budget. 2 Relates to appropriation for corporate entities which is provided through the Department. 3 Relates to the write down of bad and doubtful debts.


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Table A.8 Expenses for Outcome 3: Strengthening the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities; and providing grants and financial assistance

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 3.1: Regional development

Annual administered expenses2

Community Development Grants Fund 65,366 65,997 631

Drought Communities Programme 21,318 7,256 (14,062)

National Stronger Regions Fund 110,679 110,673 (6)

Regional Australia Institute 1,821 1,821 -

Regional Development Australia Committees 18,302 18,100 (202)

Regional Development Australia Fund 25,266 19,106 (6,160)

Regional Jobs and Investment Packages 3,500 - (3,500)

Stronger Communities Programme 24,460 19,862 (4,598)

Tasmanian Jobs and Growth Package 14,347 13,774 (573)



Program 3.2: Local government


Local Government (Financial Assistance) Act 1995 3,472,155 3,472,947 792


Total Program 3.2 expenses 3,474,580 3,475,444 864

Total Program expenses for Outcome 3 3,789,942 3,762,341 (27,601)

Notes: 1 Full-year budget, including any subsequent adjustments made to the 2016–17 Budget. 2 Excludes expenses relating to payments made to and through the states and territories by the Department of

the Treasury for the Murray‑Darling Basin Regional Economic Diversification Program, South Australia Economic Development Program and the Townsville Stadium administered items.

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Table A.9 Expenses for Outcome 4: Good governance in the Australian territories through the maintenance and improvement of the overarching legislative framework for self-governing territories, and laws and services for non-self-governing territories

Budget1Actual

Expenses Variation

2016–17 $’000

2016–17 $’000

2016–17 $’000

Program 4.1: Services to territories


ACT Government – national capital functions 1,916 1,825 (91)

Norfolk Island – Commonwealth administration 1,067 1,067 -

Norfolk Island – Kingston and Arthur’s Vale historic area 682 626 (56)

Office of Administrator, Northern Territory 374 351 (23)

Services to Indian Ocean Territories 89,787 93,581 3,794

Services to Jervis Bay Territory 5,229 5,435 206

Services to Norfolk Island 26,246 26,190 (56)

Depreciation and amortisation 53,951 54,597 646

Other2 - 69,497 69,497


Christmas Island Phosphate Mining Rehabilitation Special Account 1,500 1,212 (288)

Indian Ocean Territories Special Account 2014 25,242 21,801 (3,441)

Jervis Bay Territory Special Account 2014 1,160 744 (416)


Total Program 4.1 expenses 226,225 296,763 70,538

Total Program expenses for Outcome 4 226,225 296,763 70,538

Notes: 1 Full-year budget, including any subsequent adjustments made to the 2016–17 Budget. 2 Relates to the write off of administered investment in Norfolk Island Health Services.


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Appendix B: Procurement practicesThis appendix focuses on the Department’s procurement practices, including:

• procurement policies and practices;• competitive tendering and contracting arrangements;• use of consultancies; and• payments for advertising and marketing research.

Procurement policies and practicesThe Department’s procurement of goods and services is consistent with the requirements of the Commonwealth Procurement Rules (CPR), including achieving value for money and using resources in a proper manner. The rules are applied to procurement activities through the Accountable Authority Instructions (AAIs) and supporting operational guidelines. The Department’s procurement policies and processes have been developed to ensure compliance with the CPRs and decisions are made in an accountable and transparent manner.

In accordance with the CPRs, the Department published the following on the AusTender website <www.tenders.gov.au>:

• a procurement plan providing details of expected procurements for 2016–17;• details of publicly available procurement opportunities with a value of $80,000 or

more; and• details of all contracts, standing offers and consultancies awarded with a value of

$10,000 or more.

The Department assists employees to manage procurements appropriately by providing information and training on procurement policies and procedures, and maintaining a single point of contact for advice on the CPRs, the AAIs and tendering processes.

Indigenous procurement The portfolio is committed to the Indigenous Procurement Policy. The policy seeks to have at least three per cent of purchasing activity sourced from Indigenous suppliers. While the target for 2016–17 was 48 contracts for the portfolio, 69 contracts with a total value of $7.4 million was achieved representing 4.3 per cent of all purchasing activities being sourced from Indigenous suppliers. In addition to internal training, advertising, and news bulletins on the Departments intranet, an expo was held in February 2017 to showcase a number of Indigenous suppliers to purchasing officers within the Department.

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Australian National Audit Office Access ClausesAll contracts valued at $100,000 or more routinely include a requirement for access to the contractor’s premises by the Auditor-General.

Exempt contractsIn 2016–17, no contracts were exempted from publication on AusTender on the basis that it would disclose exempt matters under the Freedom of Information Act 1982.

Consultancy contractsThe Department engages consultants when specialist expertise, independent research, review or assessment is required. Consultants are typically engaged to provide probity or audit services; undertake valuations; investigate or diagnose a defined issue or problem; carry out defined reviews or evaluations; develop frameworks for benchmarking; or provide independent advice to assist with the Department’s decision-making.

Prior to engaging consultants, the Department takes into account the skills and resources required for the task, the skills available internally, and the cost-effectiveness of engaging external expertise. The decision to engage a consultant is made in accordance with the Public Governance, Performance and Accountability Act 2013 and related regulations including the CPRs and relevant internal policies.

The Department’s procurement solution requires that all consultancies are approved by an appropriate financial delegate and that the central procurement unit reviews all consultancies valued at $10,000 and over.

During 2016–17, 126 new consultancy contracts were entered into involving total actual expenditure of $16.4 million. In addition, 28 ongoing consultancy contracts were active during the period, involving total actual expenditure of $11.6 million.

Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website <www.tenders.gov.au>.

Table B.1 Trends and consultancies

2012–13 2013–14 2014–15 2015–16 2016–17

Consultancies

Expenditure on new and ongoing consultancies

Total expenditure $10.2m $5.6m $25.2m $34.3m $28.0m

New consultancies valued at $10,000 or more

Number let 57 88 97 84 116

Total value over the life of these contracts $4.0m $6.1m $39.0m $10.7m $29.2m


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Procurement and initiatives to support small businessThe Department supports small business participation in the Commonwealth Government procurement market. Small and medium sized enterprise (SME) and small enterprise participation statistics are available on the Department of Finance’s website <www.finance.gov.au/procurement/statistics-on-commonwealth-purchasing-contracts/>.

The Department’s measures to support SMEs include:

• use of the Commonwealth Contracting Suite for procurements valued under $200,000, which is designed to minimise the burden on business contracting with Government; and

• encouraging the use of credit cards for procurements valued below $5,000.

The Department recognises the importance of ensuring that small businesses are paid on time. The results of the Survey of Australian Government Payments to Small Businesses are available on the Treasury’s website <www.treasury.gov.au>.

Payments for advertising and market researchIn 2016–17, the Department paid $402,450 for advertising and market research. Table B.2 lists payments of $13,000 (inclusive of GST) or more made during the financial year, as required by section 311A of the Commonwealth Electoral Act 1918.

During 2016–17, the Department undertook no reportable advertising campaigns.

Table B.2 Details of advertising and market research payments of $13,000 or more

Market research/polling

Firm Service provided Payment made in 2016–17

Wallis Consulting Group Benchmark and evaluation services $30,591

Colmar Brunton Benchmark and evaluation services $97,250

GfK Australia Benchmark and evaluation services $98,276

AMR Interactive Pty Ltd Evaluation and media research services $101,502

Total market research/polling $327,619

Media advertising organisations

Firm Service provided Payment made in 2016–17

Dentsu Mitchell Public Notices (various) $13,147

Total media advertising organisations $13,147

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Appendix C: Ecologically sustainable development and environmental performanceThe following summary of the Department’s environmental management activities and performance is provided in accordance with the Environment Protection and Biodiversity Conservation Act 1999, which requires entities to report on:

• how their activities accord with, and their outcomes contribute to, the principles of ecologically sustainable development; and

• the environmental impacts of their operations during the year, and measures taken to minimise these.

The Department undertakes all of its activities, from corporate initiatives to departmental policies, programs and procedures, in accordance with the five principles set out in the Act: integration, precaution, intergeneration, biodiversity and valuation.

Infrastructure and regional developmentUnder the Infrastructure Investment program, the Department worked in partnership with state and territory transport agencies to ensure environmental issues were appropriately considered in identifying, designing and delivering infrastructure projects.

The Department continued to implement programs which support the sustainability of Australia’s regions. This included ongoing support for projects that construct and install sustainable infrastructure, including the use of current ecologically sustainable technology.

MarineThe Department played a key role in protecting the marine environment for future generations from the impacts of international shipping through its ongoing work at the International Maritime Organization’s (IMO) Marine Environment Protection Committee. The International Code for Ships Operating in Polar Waters (Polar Code) entered into force internationally on 1 January 2017. The Polar Code specifies operational and structural measures for ships, to improve maritime safety and minimise environmental risks in polar environments. These measures encompass design, construction, equipment and operational matters, as well as training, search and rescue, and environmental discharges.

The Protection of the Sea (Prevention of Pollution from Ships) Amendment (Polar Code) Bill 2017 (assented on 19 May 2017) amended the Protection of the Sea (Prevention of Pollution from Ships) Act 1983 to implement conditions in the Polar Code, especially requirements relating to the discharge of sewage from ships in polar regions.

The Department continued to collaborate with the Department of Foreign Affairs and Trade and the Australian Maritime Safety Authority to help develop international standards to reduce greenhouse gas emissions from international shipping. The IMO is working towards an initial strategy on reducing greenhouse gas emissions from international shipping, set for adoption in early 2018.

The Department also administered the annual Australian contribution to the IMO and the International Oil Pollution Compensation Fund.


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Motor vehiclesThe Ministerial Forum on Vehicle Emissions was established in October 2015 to coordinate a whole-of-government approach to reducing vehicle emissions. In 2016, the Department worked with the Department of the Environment and Energy to develop three proposals to improve fuel efficiency, reduce noxious emissions and improve fuel quality, as well as provide regulatory impact statements. The Ministerial Forum released these proposals for public comment in December 2016. The Australian Government is expecting to take a decision on the detail and timing of these proposals in 2017–18.

AviationThe Department worked with the International Civil Aviation Organization (ICAO) on global strategies to redress impacts of aviation on the environment, including aircraft noise and emissions. This included establishing a cross-agency/industry working group to help ICAO develop the technical elements of the Carbon Offsetting and Reduction Scheme for International Aviation, and to oversee implementation of the scheme in Australia to allow international aviation operators to meet reporting requirements under the scheme commencing 1 January 2019.

The Department assessed the environmental, social and economic impacts of all airport master plans, major development plans and airport environment strategies, which airport lessee companies are required to prepare and submit for approval under the Airports Act 1996. The Department advised the Hon Darren Chester MP, Minister for Infrastructure and Transport, on the extent that these documents met legislative requirements, including assessments of environmental impacts and plans for dealing with them.

The Australian Government purchased land at Badgerys Creek in the 1980s and 1990s in preparation for a decision on the location of a future airport. The administered program, Sydney West Airport – site management, pays for water and land rates, maintenance and other costs associated with renting out the properties on this land. The Department continued to implement a tenancy transition plan to ensure the site could be vacated and prepared for the development of an airport.

As tenants have vacated the site, buildings and structures have been demolished and services disconnected to reduce health and safety risks. Other property management activities have included the appropriate management of illegal dumping and site security measures.

The Australian Government conducted a robust and rigorous environmental assessment for the Western Sydney Airport at Badgerys Creek. The development of the Environmental Impact Statement (EIS) was informed by 5,000 submissions and 16 community information events across nine different council areas in Western Sydney during its development. The EIS considered a range of factors, including the environmental, social, economic and cultural aspects of developing and operating an airport in the area. Mitigation measures to minimise and manage the impacts are also considered in the environmental assessment.

Following finalisation of the EIS, a strict set of more than 40 environmental conditions, addressing environmental issues across biodiversity, noise and heritage, were included as part of the development approval for the Western Sydney Airport.

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TerritoriesThe Department is responsible for infrastructure delivery in the Indian Ocean Territories and Jervis Bay Territory. Each infrastructure project was assessed against the requirements under the Environment Protection and Biodiversity Conservation Act at the project approval stage. Where required, Environmental management plans were established at the construction phase and implemented during project delivery. All project design and delivery work took into account sustainability principles and whole-of-life impacts.

Throughout the year, the Department had access to the Department of Defence’s infrastructure and environment and heritage panels. This helped the Department plan for projects, develop requests for tender documentation, incorporate environmental requirements into contractual arrangements, and obtain environmental approvals.

On Norfolk Island, all historical area works aligned with ecological sustainability requirements. In addition, the Department continues to work with the Norfolk Island Regional Council to assist it to develop more sustainable waste management practices.

Office energy useThe Department is committed to implementing ecologically sustainable principles in its operations and limits the consumption of office energy and other resources wherever practical.

All central office locations use automated lighting controls to switch off non‑essential lighting outside of work hours and have devices in place to minimise water use. A number of initiatives are in place to provide effective waste management and to monitor and maintain indoor environment quality in major offices.

The Department uses seven per cent green energy and has also been progressively reducing the carbon footprint from the use of motor vehicles. Today, the Departments’ entire operational vehicle fleet is hybrid technology vehicles.

No breaches of environmental laws or licences by the Department were reported during 2016–17.

Due to a difference between reporting timeframes for the energy use data and the Department’s Annual Report, energy consumption data for 2016–17 will be provided in the Annual Report for 2017–18. Data for 2014–15 and 2015–16 are provided in Table C.1.


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Table C.1 Departmental energy consumption 2014–15 to 2015–16

Buildings and electricity 2014–15 2015–16

Office buildings

Area occupied (m2) 43,143 34,565

Occupantsa 1,305 1,326

Area per person (m2) 33.04 26.07

Electricity used (GJ) 12,755 10,949

Electricity used per person (MJ)b 9,774 8,257

Electricity used by area (MJ/m2) 296 317

Electricity sourced from renewable sources (%) 4.4 7.3

Other buildingsc

Area occupied (m2) 453 453

Electricity used (GJ)d 348 324

Electricity used by area (MJ/m2) 768 715

Total of the above

Direct energy consumed (GJ) 13,103 11,273

Greenhouse gas emissions (tonnes of carbon dioxide equivalents)e 3,593 2,990

Notes: a Occupants may include contractors and employees of contracted service providers as well as departmental employees. b The Australian Government’s energy consumption target is no more than 7,500 megajoules per person per year. c Other buildings (Mitchell Warehouse) the Net Lettable Area is apportioned to 35 per cent. d Includes green power. e Emission includes scope 2 (direct) and scope 3 (indirect).

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Appendix D: Report under the Work Health and Safety Act 2011The Department recognises its obligation to provide a safe working environment and is committed to ensuring the health, safety and wellbeing of employees while they are at work. This includes effective and timely incident investigation and injury management.

Increased education and awareness of work health and safety across the Department was undertaken in 2016–17 to promote active engagement in workplace safety. This included an ongoing communication campaign and the promotion of Mental Health Week and Safety Month, which was held in October 2016. In addition, the Department’s contract with the Employee Assistance Program provider was extended for a further year.

The Rehabilitation Management System, Fitness for Duty Employment Procedure, Reasonable Adjustment Employment Procedure and Return to Work Assistance Employment Procedure were updated in 2016–17. In addition, the Department embedded an early intervention approach into its Rehabilitation Management System in August 2016 with the aim to reduce lost time for work related injuries and have a positive influence on workers compensation premiums. The Department’s 2017–18 Comcare premium is 0.52 per cent of payroll, which is a reduction from last year’s premium of 0.72 per cent.

Workplace health and safety statisticsTable D.1 provides a summary of health and safety outcomes, notifiable incidents, investigations and notices in accordance with the Work Health and Safety Act.


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Table D.1 Workplace health and safety statistics in 2016–17

Proactive measures

Workstation assessments 195

Employee health assessments 301

Employee influenza vaccinations 540

Wellbeing indicators

Employee using employee assistance % 8.78

Days of unscheduled absence per full-time equivalent employeea 12.9

Workers compensation

New claims accepted by Comcareb,c 5

Total weeks lost from new claims through incapacityb,c 38.40

Average time off work per injury (weeks)b 7.68

Incidents, notifiable incidents, investigations and noticesd

Reported workplace incidents, injuries, illness or near misses 88

Death of a person that required notice to Comcare under section 35 0

Serious injury or illness of a person that required notice to Comcare under section 35 0

Dangerous incident that required notice to Comcare under section 35 2

Notices given to the Department under section 90 (provisional improvement notices) 0

Notices given to the Department under part 10, section 191 (improvement notices) 0

Notices given to the Department under part 10, section 195 (prohibition notices) 0

Directions given to the Department under part 10, section 198 (non-disturbance) 0

Exemptions given under section 276 0

Inspector reports issued by Comcare 2

Notes: a Unscheduled absence includes sick leave, carer’s leave, unauthorised absences and compassionate/bereavement leave. Workers’ compensation leave is not included.

b These figures are as advised by Comcare. c Includes four accepted claims from former employees from the Australian National Railways, which was sold by the

Australian Government in 1997–98. d Includes notifiable incidents, investigations and notices in the Indian Ocean Territories.

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Part 7: Appendices

Appendix E: Reports under aviation legislationThe information in this appendix supplements that in parts 3 and 5 of this report.

International aviationSection 29(1) of the Air Navigation Act 1920 requires the Department to report on the administration and operation of this Act and the regulations during the year that ended on 30 June, and on such other matters concerning civil aviation the Secretary considers should be included in the report.

The Department continued to regulate scheduled international air services in accordance with the Air Navigation Act and associated regulations. The Department granted 448 timetable approvals, 305 timetable variations, eight non‑scheduled flight approvals and five approvals for new International Airline Licences in 2016–17.

Environment authorisations and protection ordersParagraph 5.15(2) of the Airports (Environment Protection) Regulations 1997 requires the Department to report within its annual report the notification of environmental authorisations.

The Department may authorise an airport to undertake action, which may result in environmental emissions limits being exceeded, where the emissions would be no more damaging to the environment than if the limits were met. No environmental authorisations took place during the reporting period.

The Department may make an environment protection order under part 7, division 1 of the Airports (Environment Protection) Regulations 1997 directing an airport to comply with a duty to avoid polluting to preserve habitat, or to prevent offensive noise. No environment protection orders were made during the reporting period.

Aircraft noise levy collectionSection 20 of the Aircraft Noise Levy Collection Act 1995 requires the Department’s annual report to report to include adherence to the Aircraft Noise Levy Act 1995 and the Aircraft Noise Levy Collection Act.

In 2016–17, the Department did not take any reportable actions under either of these Acts and there were no breaches of these Acts.


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Appendix F: Report under the National Land Transport Act 2014Section 94 of the National Land Transport Act requires an annual report on the operation of the Act as soon as practicable after the end of each financial year that ends after the commencement of parts 3, 4, 5, 7 and 8. For information on the operation of this Act, see parts 3 and 5 of this report.

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Part 7: Appendices

Appendix G: Correction of material errors in 2015–16 Annual ReportIn the 2015–16 Annual Report, the number of vehicles operating under the Federal Interstate Registration Scheme was incorrectly reported as 20,412 (pages 34 and 36). The correct figure is 14,648.

In addition, the figures provided at Table C.1 in the 2015–16 Annual Report (page 105) were reported incorrectly for 2014–15. Table G1 provides the correct figures.

Table G.1 Departmental energy consumption 2014–15

Buildings and electricity 2014–15

Office buildings

Area occupied (m2) 43,143

Occupantsa 1,305

Area per person (m2) 33.04

Electricity used (GJ) 12,755

Electricity used per person (MJ)b 9,774

Electricity used by area (MJ/m2) 296

Electricity sourced from renewable sources (%) 4.4

Other buildingsc

Area occupied (m2) 453

Electricity used (GJ)d 348

Electricity used by area (MJ/m2) 768

Total of the above

Direct energy consumed (GJ) 13,103

Greenhouse gas emissions (tonnes of carbon dioxide equivalents)e 3,593

Notes: a Occupants may include contractors and employees of contracted service providers as well as departmental employees. b The Australian Government’s energy consumption target is no more than 7,500 megajoules per person per year. c Other buildings (Mitchell Warehouse) the Net Lettable Area is apportioned to 35 per cent. d Includes green power. e Emission includes scope 2 (direct) and scope 3 (indirect).


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Appendix H: Summary of administered expense programsTable H.1 provides the Department’s administered expense programs alongside funds paid in 2016–17 and the page number where more information is provided in the body of this report.

Table H.1: Summary of administered expense programs

Administered item

Funds paid in 2016–17

($‘000) Page


Infrastructure Investment Program – Investment 109,194* 27

Infrastructure Investment Program – Black Spot Program –* 27–29

Infrastructure Investment Program – Roads to Recovery 815,460 27

Infrastructure Investment Program – Northern Australia Roads Program –* 28

Infrastructure Investment Program – Northern Australia Beef Roads Program –* 28

Infrastructure Investment Program – Bridges Renewal Program –* 27

Infrastructure Investment Program – Heavy Vehicle Safety and Productivity Program –* 27

WestConnex Stage 2 – provision of a concessional loan 111,881 26

Plan for the Future – Building Australia Fund – 28, 29

Victorian Infrastructure Package – 28

Building our Future campaign 69 –

Infrastructure Growth Package – New Investments –* 28

Infrastructure Growth Package – Western Sydney Infrastructure Plan –* 27, 28

Transport Security

Aviation Security Enhancements – Improving International Aviation Security 19 32

Aviation Security Enhancements – Regional and Remote Airports Security Awareness 128 32

Surface Transport

Bass Strait Passenger Vehicle Equalisation Scheme 47,769 36

International Maritime Organization – contribution 277 37

Interstate Road Transport Account 67,602 35

National Heavy Vehicle Regulator 3,852 35

OECD Road Transport – contribution 46 35

Protection of the Sea (Oil Pollution Compensation Funds) Act 1993 394 38

Tasmanian Freight Equalisation Scheme 137,612 36

Road Safety

keys2drive 4,000 40

Air Transport

Airport Lessee Companies – reimbursement of parking fines 947 42

Hobart International Airport runway extension – contribution 22,000 41, 42

International Civil Aviation Organization – contribution 2,149 44continued...

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Part 7: Appendices

Administered item

Funds paid in 2016–17

($‘000) Page

Melbourne Airport New Runway Land Acquisition 5,444 41

Payment scheme for Airservices Australia’s en route charges 1,516 43

Regional Aviation Access 23,602 43

Sydney West Airport – site management 7,902 41

Regional Development

Building Better Regions Fund – 47

Community Development Grants Fund 65,997 47

Drought Communities Programme 7,256 47

National Stronger Regions Fund 110,673 47

Regional Australia Institute 1,821 47

Regional Development Australia Committees 18,100 47

Regional Development Australia Fund 19,106 47

Regional Jobs and Investment Packages – 48

Stronger Communities Programme 19,862 48

Tasmanian Jobs and Growth Package 13,774 48

Local Government

Local Government (Financial Assistance) Act 1995 3,472,947 49

Services to Territories

ACT Government – national capital functions 1,825 51

Christmas Island Phosphate Mining Rehabilitation special account 1,212 51

Norfolk Island – Commonwealth administration 1,067 50

Norfolk Island – Kingston and Arthur’s Vale Historic Area 626 50

Office of the Administrator, Northern Territory 351 51

Services to Indian Ocean Territories and Indian Ocean Territories special account 115,382 50, 51

Services to Jervis Bay Territory and Jervis Bay Territory special account 6,179 51

Services to Norfolk Island 26,190 50

Note: * Additional payments are made to and through the states and territories by the Department of the Treasury.


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Appendix I: List of requirementsTable I.1 reproduces the table set out in Schedule 2 of the PGPA Rule. Section 17A(d) requires this table to be included in entities’ annual reports as an aid of access.

Table I.1 List of requirements

PGPA Rule Reference Description Requirement Part Page

17AD(g) Letter of transmittal

17AI A copy of the letter of transmittal signed and dated by accountable authority on date final text approved, with statement that the report has been prepared in accordance with section 46 of the Act and any enabling legislation that specifies additional requirements in relation to the annual report.

Mandatory Letter of Transmittal

iii

17AD(h) Aids to access

17AJ(a) Table of contents Mandatory Contents v, vi

17AJ(b) Alphabetical index Mandatory Part 8 199

17AJ(c) Glossary of abbreviations and acronyms Mandatory Part 8 194–198

17AJ(d) List of requirements Mandatory Appendix I 186–191

17AJ(e) Details of contact officer Mandatory Guide to this report

iv

17AJ(f) Entity’s website address Mandatory Guide to this report

iv

17AJ(g) Electronic address of report Mandatory Guide to this report

iv

17AD(a) Review by accountable authority

17AD(a) A review by the accountable authority of the entity Mandatory Part 1 4–7

17AD(b) Overview of the entity

17AE(1)(a)(i) A description of the role and functions of the entity Mandatory Part 2 14

17AE(1)(a)(ii) A description of the organisational structure of the entity

Mandatory Part 2 17

17AE(1)(a)(iii) A description of the outcomes and programs administered by the entity

Mandatory Part 2 16

17AE(1)(a)(iv) A description of the purposes of the entity as included in the Corporate Plan

Mandatory Part 2 15, 16

17AE(1)(b) An outline of the structure of the portfolio of the entity

Portfolio departments - Mandatory

Part 2 20–23

17AE(2) Where the outcomes and programs administered by the entity differ from any Portfolio Budget Statement, Portfolio Additional Estimates Statement or other portfolio estimates statement that was prepared for the entity for the period, include details of variation and reasons for change.

If applicable, mandatory

n/a —

continued...

187

Part 7: Appendices


17AD(c) Report on the performance of the entity

Annual performance statements

17AD(c)(i); 16F Annual performance statements in accordance with paragraph 39(1)(b) of the Act and section 16F of the Rule.

Mandatory Part 5 72–98

17AD(c)(ii) Report on financial performance Mandatory Part 1 and Appendix A

8–11, 160–171

17AF(1)(a) Discussion and analysis of financial performance. Mandatory Part 1 8–11

17AF(1)(b) A table summarising the total resources and total payments of the entity.

Mandatory Appendix A 160–171

17AF(2) If there may be significant changes in the financial results during or after the previous or current reporting period, information on those changes, including: the cause of any operating loss of the entity; how the entity has responded to the loss and the actions that have been taken in relation to the loss; and any matter or circumstances that it can reasonably be anticipated will have a significant impact on future operation or financial results.


n/a —

17AD(d) Management and accountability

Corporate governance

17AG(2)(a) Information on compliance with section 10 (fraud systems).

Mandatory Part 4 58

17AG(2)(b)(i) A certification by accountable authority that fraud risk assessments and fraud control plans have been prepared.


iii

17AG(2)(b)(ii) A certification by the accountable authority that appropriate mechanisms for preventing, detecting incidents of, investigating or otherwise dealing with, and recording or reporting fraud that meet the specific needs of the entity are in place.


iii

17AG(2)(b)(iii) A certification by the accountable authority that all reasonable measures have been taken to deal appropriately with fraud relating to the entity.


iii

17AG(2)(c) An outline of structures and processes in place for the entity to implement principles and objectives of corporate governance.


17AG(2)(d) – (e) A statement of significant issues reported to Minister under paragraph 19(1)(e) of the Act that relates to non-compliance with Finance law and action taken to remedy non-compliance.


n/a —

continued...


ent 188


External scrutiny

17AG(3) Information on the most significant developments in external scrutiny and the entity’s response to the scrutiny.


17AG(3)(a) Information on judicial decisions and decisions of administrative tribunals and by the Australian Information Commissioner that may have a significant effect on the operations of the entity.


Part 4 60

17AG(3)(b) Information on any reports on operations of the entity by the Auditor-General (other than report under section 43 of the Act), a Parliamentary Committee, or the Commonwealth Ombudsman.


Part 4 61

17AG(3)(c) Information on any capability reviews on the entity that were released during the period.


n/a —

Management of human resources

17AG(4)(a) An assessment of the Department’s effectiveness in managing and developing employees to achieve entity objectives.


17AG(4)(b) Statistics on the entity’s APS employees on an ongoing and non-ongoing basis; including the following:• staffing classification level;• full-time employees;• part-time employees;• gender;• staff location; and• employees who identify as Indigenous.


17AG(4)(c) Information on any enterprise agreements, individual flexibility arrangements, Australian workplace agreements, common law contracts and determinations under subsection 24(1) of the Public Service Act 1999.


17AG(4)(c)(i) Information on the number of SES and non-SES employees covered by agreements etc. identified in paragraph 17AG(4)(c).


17AG(4)(c)(ii) The salary ranges available for APS employees by classification level.

Mandatory Part 4 67

17AG(4)(c)(iii) A description of non‑salary benefits provided to employees.

Mandatory Part 4 65

17AG(4)(d)(i) Information on the number of employees at each classification level who received performance pay.

If applicable, Mandatory

Part 4 65

17AG(4)(d)(ii) Information on aggregate amounts of performance pay at each classification level.


Part 4 65

17AG(4)(d)(iii) Information on the average amount of performance payment, and range of such payments, at each classification level.


Part 4 65

17AG(4)(d)(iv) Information on aggregate amount of performance payments.


Part 4 65

continued...

189

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Assets management

17AG(5) An assessment of effectiveness of assets management where asset management is a significant part of the entity’s activities.


Part 4 68, 69

Purchasing

17AG(6) An assessment of entity performance against the Commonwealth Procurement Rules.

Mandatory Appendix B 172–174

Consultants

17AG(7)(a) A summary statement detailing the number of new contracts engaging consultants entered into during the period; the total actual expenditure on all new consultancy contracts entered into during the period (inclusive of GST); the number of ongoing consultancy contracts that were entered into during a previous reporting period; and the total actual expenditure in the reporting year on the ongoing consultancy contracts (inclusive of GST).

Mandatory Appendix B 173

17AG(7)(b) A statement that “During [reporting period], [specified number] new consultancy contracts were entered into involving total actual expenditure of $[specified million]. In addition, [specified number] ongoing consultancy contracts were active during the period, involving total actual expenditure of $[specified million]”.


17AG(7)(c) A summary of the policies and procedures for selecting and engaging consultants and the main categories of purposes for which consultants were selected and engaged.

Mandatory Appendix B 172–174

17AG(7)(d) A statement that “Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website”.


Australian National Audit Office access clauses

17AG(8) If an entity entered into a contract with a value of more than $100,000 (inclusive of GST) and the contract did not provide the Auditor-General with access to the contractor’s premises, the report must include the name of the contractor, purpose and value of the contract, and the reason why a clause allowing access was not included in the contract.


Appendix B 173

continued...


ent 190


Exempt contracts

17AG(9) If an entity entered into a contract or there is a standing offer with a value greater than $10,000 (inclusive of GST) which has been exempted from being published in AusTender because it would disclose exempt matters under the FOI Act, the annual report must include a statement that the contract or standing offer has been exempted, and the value of the contract or standing offer, to the extent that doing so does not disclose the exempt matters.


Appendix B 173

Small business

17AG(10)(a) A statement that “[Name of entity] supports small business participation in the Commonwealth Government procurement market. Small and Medium Enterprises (SME) and Small Enterprise participation statistics are available on the Department of Finance’s website”.


17AG(10)(b) An outline of the ways in which the procurement practices of the entity support small and medium enterprises.


17AG(10)(c) If the entity is considered by the Department administered by the Finance Minister as material in nature—a statement that “[Name of entity] recognises the importance of ensuring that small businesses are paid on time. The results of the Survey of Australian Government Payments to Small Business are available on the Treasury’s website”.


Appendix B 174

Financial statements

17AD(e) Inclusion of the annual financial statements in accordance with subsection 43(4) of the Act.


17AD(f) Other mandatory information

17AH(1)(a)(i) If the entity conducted advertising campaigns, a statement that “During [reporting period], the [name of entity] conducted the following advertising campaigns: [name of advertising campaigns undertaken]. Further information on those advertising campaigns is available at [address of entity’s website] and in the reports on Australian Government advertising prepared by the Department of Finance. Those reports are available on the Department of Finance’s website”.


n/a —

17AH(1)(a)(ii) If the entity did not conduct advertising campaigns, a statement to that effect.


Appendix B 174

17AH(1)(b) A statement that “Information on grants awarded to [name of entity] during [reporting period] is available at [address of entity’s website].”


Part 4 60

continued...

191

Part 7: Appendices


17AH(1)(c) Outline of mechanisms of disability reporting, including reference to website for further information.

Mandatory Part 4 65

17AH(1)(d) Website reference to where the entity’s Information Publication Scheme statement pursuant to Part II of FOI Act can be found.

Mandatory Part 4 60

17AH(1)(e) Correction of material errors in previous annual report.


Appendix G 183

17AH(2) Information required by other legislation

Legal expenditure (paragraph 11.1(ba) of the Legal Services Directions 2017).

Mandatory Part 4 60

Advertising and Market Research (section 311A of the Commonwealth Electoral Act 1918) and statement on advertising campaigns.


Ecologically sustainable development and environmental performance (section 516A of the Environment Protection and Biodiversity Conservation Act 1999).

Mandatory Appendix C 175–178

Work health and safety (schedule 2, part 4 of the Work Health and Safety Act 2011).

Mandatory Appendix D 179, 180

Information required under:paragraph 5.15(2) of the Airports (Environment Protection) Regulations 1997;section 29 of the Air Navigation Act 1920;section 20 of the Aircraft Noise Levy Collection Act 1995.

Mandatory Appendix E 181

An annual report on the operation of the National Transport Act 2014, as required under section 94 of the National Land Transport Act.

Mandatory Appendix F 182

8 KEY TERMS AND INDEX


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Part 8: Key terms and index

GlossaryAccountable authority

Under the Public Governance, Performance and Accountability Act 2013, the person responsible for, and with control over, the Department’s operations. The accountable authority of the Department is the Secretary.

Administered items/activities/ programs

Revenues, expenses, assets and liabilities that the Australian Government controls, which an agency or authority manages on the Government’s behalf.

Air services arrangements

Treaty-level aviation agreements negotiated with international governments. Air service arrangements may contain provisions on the routes airlines can fly, the number of flights that can be operated, tariffs and the number of airlines designated to operate services.

Benefit cost ratios Benefit cost ratios (BCRs) are an indicator for planning, evaluation and investment as they summarise the overall value for money of a project. A result over 1.0 indicates the economic benefits for the project are greater than the economic costs.

B-Double A combination consisting of a prime mover towing two semi-trailers where the first semi‑trailer is connected to the prime mover by a fifth wheel coupling and the second semi‑trailer is connected to the first semi‑trailer by a fifth wheel coupling.

Black Spot Those road locations where crashes are occurring. Black Spot projects at dangerous road locations reduce the risk of crashes.

Compliance activity

An activity designed to achieve assurance, such as audits, inspections and systems tests.

Corporate governance

The process by which agencies are directed and controlled. It is generally understood to encompass authority, accountability, stewardship leadership, direction and control.

Division An organisational unit within the Department, which is managed by an executive director and reports to the Secretary.

Ecological sustainable development

Using, conserving and enhancing the community’s resources so that ecological processes, on which life depends, are maintained and the total quality of life, now and in the future, can be increased.

Enterprise agreement

An agreement made at enterprise level between employers and employees about the terms and conditions of employment.

195


Federal Executive Council

The formal, constitutional and legal body responsible for advising the Governor-General (as distinct from Cabinet).

Federally leased airport

The leased federal airports in each state and territory that were granted on long-term leases to private entities between 1997 and 2003.

Freight Goods transported by truck, train, ship or aircraft.

General Government Sector

A classification of entities controlled and largely funded by the Australian Government. The sector provides public services for the collective consumption of the community or services that involve the transfer and redistribution of income. All government departments are classified as General Government Sector entities.

Grant Commonwealth financial assistance as defined under the Commonwealth Grants Rules and Guidelines.

Greenhouse gas emissions

Emissions that contribute to climate change such as carbon dioxide (CO2), nitrous oxide and methane. In vehicles, the principal greenhouse gas is CO2.

Heavy vehicle road reform

Road charging and investment reform with the goal to turn the provision of heavy vehicle road infrastructure into an economic service where feasible. This would see a market established that links the needs of heavy vehicle users with the level of service they receive, the charges they pay and the investment of those charges back into road services.

Inspector of Transport Security

An appointee who conducts inquiries into transport security incidents at the discretion of the Minister for Infrastructure and Transport.

Last port of call An International airport that hosts direct flights to Australia.

Noxious emissions

Air pollutants such as carbon monoxide, nitrogen oxides, particulate matter, volatile organic compounds and benzene, which are emitted into the environment by motor vehicles. Noxious emissions can contribute to urban air quality problems, such as photochemical smog, and adversely affect human health.

Polar Code International Code for Ships Operating in Polar Waters.

Portfolio A minister’s area of responsibility as a member of Cabinet.

Portfolio Budget Statements

A budget-related paper detailing budget initiatives and appropriations, by outcome and program, for each entity within a portfolio.

Program An activity or group of activities that delivers benefits or services, or transfers payments to individuals, industry or the community as a whole.


ent 196

Regional Development Australia committee

Regional Development Australia (RDA) is an Australian Government initiative that brings together all levels of government to enhance the development of Australia’s regions. A national network of RDA committees has been established to achieve this objective.

Regulation Any rule endorsed by government where there is an expectation of compliance.

Road user charging

Direct charging that reflects each user’s own consumption of the road network.

Value capture A term used to describe a range of funding and financing mechanisms which seek to leverage the broad range of benefits (such as uplift in property values and labour force accessibility) which can be generated by new or upgraded transport infrastructure.

197


AcronymsAASB Australian Accounting Standards BoardACT Australian Capital TerritoryADRs Australian Design RulesAMSA Australian Maritime Safety AuthorityANCAP Australian New Car Assessment ProgramAO Officer of the Order of AustraliaAPS Australian Public ServiceARTC Australian Rail Track CorporationASIC Aviation Security Identification CardBCR Benefit Cost RatioBITRE Bureau of Infrastructure, Transport and Regional EconomicsBTKM Billion-Tonne-KilometresCASA Civil Aviation Safety AuthorityCO2 Carbon dioxideCPR Commonwealth Procurement RulesCPSU Community and Public Sector UnionEACE Enhanced Air Cargo ExaminationEIS Environmental Impact StatementEL Executive LevelFOI Freedom of InformationFOWSA Forum on Western Sydney AirportFTE Full Time EquivalentGA General AviationGST Goods and Services TaxICAO International Civil Aviation OrganizationIMO International Maritime OrganizationIOPC Funds International Oil Pollution Compensations FundsIT Information TechnologyITF International Transport ForumKAVHA Kingston and Arthur’s Vale Heritage AreaLPOC Last Port of CallMSIC Maritime Security Identification CardNAIDOC National Aborigines and Islanders Day Observance CommitteeNCA National Capital AuthorityNCP National Compliance PlanNMSR National Maritime Safety RegulatorOECD Organisation for Economic Co-operation and DevelopmentPGPA Act Public Governance, Performance and Accountability Act 2013


ent 198

PGPA Rule Public Governance, Performance and Accountability Rule 2014QUAD Bilateral partnership between Australia, Canada, the European

Commission and the United StatesRASS Remote Air Services SubsidyRAV Register of Approved VehiclesRAWS Registered Automotive Workshop SchemeRDA Regional Development AustraliaSES Senior Executive ServiceSME Small and Medium EnterprisesSOLAS Safety of Life at SeaTSA Transport Security AdministrationUN United NationsUS United StatesWSA Co. Western Sydney Airport CompanyWSIP Western Sydney Infrastructure Plan

199


IndexAAboriginal and Torres Strait Islander peoples, 64, 92

departmental employees identifying as, 66, 68departmental suppliers, 172

absence rates, unscheduled, 62, 180accountability and management, 54–69Accountable Authority Instructions (AAIs), 172Adelaide, 27, 28, 47, 78administered items, 9–11, 160–171

expense programs, 184, 185administrative tribunal decisions, 60Advanced Sensor Manufacturing Facility, Launceston,

95advertising and market research payments, 174Age Pension, Norfolk Island residents receiving, 52aged care services, Norfolk Island, 97, 98air cargo and air cargo agents, 3, 6, 30, 31, 33, 82Air Navigation Act 1920, iii, 181air services arrangements/agreements, 3, 5, 44,

91–93Air Transport, see aviationAircraft Noise Levy Collection Act 1995, iii, 181airports, 5, 14, 41, 42, 60, 75, 91, 176, 181, 184

capacity level, 75, 91, 92last port of call (LPOC) aviation security

assessments, 30, 31plans, 42, 45, 92, 93security, 31, 32screening processes, 30, 31, 61, 81see also Western Sydney Airport

Airports (Environment Protection) Regulations 1997, iii, 181

Airservices Australia, 10, 20, 22, 90, 101en route charges payment scheme, 43, 169, 185

airspace protection, 3, 43annual performance statements, iii, 6, 58, 72–98annual report 2015–16 errors, 183annual report list of requirements, 186–191Aquatic Recreation Centre, Gympie, 95articulated trucks, see heavy vehiclesasbestos, 51Asia‑Pacific Economic Cooperation, 5, 31asset management, 68, 69Asset Recycling Fund, 10Attorney-General’s Department, 31Audit Committee, 55, 58, 59audits,

internal, 54, 55, 58, 59Registered Automotive Workshops Scheme (RAWS),

39, 40transport security, 2, 30vehicle, 89

ACT, 50, 51, 66, 97, 98, 171, 185air travel, 5, 42

Australian Design Rules (ADR), 89, 90Australian Information Commissioner, 60Australian Infrastructure Plan response, 4, 26, 34Australian Maritime Safety Authority, 19–21, 37, 87,

168, 175Australian National Audit Office, 55, 61, 100–102, 173Australian Network on Disability, 63Australian Public Service Employee Census, 62Australian Rail Track Corporation (ARTC), 20, 26 29Australian Road Research Board, 87Australian Transport Safety Bureau, 20–22average staffing level, 8, 162, 164–166aviation (Air Transport), 16, 41–45, 90–93, 181

activities, 41–45administered items, 184, 185expenses, 164, 169performance, 90–93security, 5–6, 30–33, 80–82see also airports

Aviation and Airports Division, 16, 17, 19Aviation Security Enhancement—Improving International

Aviation Security, 32, 168, 184Aviation Security Enhancement—Regional and Remote

Airports Security Awareness, 32, 184aviation security identification cards (ASIC), 5, 30, 31, 82Awards for Local Government, 49

BB-double trucks, see heavy vehiclesBadgerys Creek, see Western Sydney AirportBallina, 78Banyan Park Early Learning Centre, 52Bass Strait Passenger Vehicle Equalisation Scheme,

36, 168, 184beef roads, 28, 184Bendigo, 48benefit cost ratios, 74, 77, 79Black Spot Program, 2, 5, 27–29, 79, 167, 184braking systems, for motorcycles, 39, 40bridges, 28, 87

Bridges Renewal Program, 5, 27, 86, 167, 184Brisbane–Melbourne Inland Rail, 4, 29Bruce Highway, 27, 78, 79Building Australia Fund, 28, 29, 184Building Better Regions Fund, 6, 47, 52, 185Bureau of Infrastructure, Transport and Regional

Economics (BITRE), 2, 43buses, 39business continuity management, 58business plans, 58


ent 200

CCanada, 31, 82Canberra, 8, 19, 23, 47

air travel, 5, 42capacity building activities with partner countries, 31,

32, 44, 80–82Cape York Region Package, 78carbon dioxide, see greenhouse gas emissionsCarbon Offsetting and Reduction Scheme for

International Aviation, 176cargo, see freightcars, see road transportCascade Pier, 50, 68, 98cattle roads, 28Champion for Gender Equality, 19, 63Chief Financial Officer, 54–57Chief Information Officer and Chief Information Security

Officer, 54, 55, 57Chief Operating Officer, 54–56, 57child care, Norfolk Island, 52China, 3, 5, 44Christmas Island, 50, 51, 97, 98 Christmas Island Crown Land Management Plan, 51Christmas Island Phosphate Mining Rehabilitation

Special Account, 51, 161, 171, 185Civil Aviation Safety Authority, 20, 22, 90, 169classification levels of workforce, 66, 67coastal shipping, see maritime and shippingCocos (Keeling) Islands, 50, 97, 98Comcare, 179, 180Commonwealth Contracting Suite, 174Commonwealth Ombudsman, 61Commonwealth Procurement Rules (CPRs), 172Community and Public Sector Union, 57community awareness and understanding, 85, 87Community Development Grants Programme, 47, 48Competition and Consumer Act 2010, 36compliance activities, 2, 59

airport lease reviews, 42transport security, 30, 81vehicle safety, 39

concessional loans, 9, 26, 169ACT Government, 51WestConnex, 10, 26, 27, 167, 184

conflict of interest, 59, 60consultancy contracts, 173consultative arrangements

air transport, 43, 45road safety, 35, 39, 40with staff, 57, 64surface transport, 34, 36, 38transport security, 31, 32, 33, 43, 82

contracts, see procurement practicesConvention for the Safety of Life at Sea, 87

Convention on the Facilitation of International Maritime Traffic, 37

Cooroy, 78, 79corporate governance, 54–60Corporate Plan, 7, 57–59, 73Corporate Services Division, 17, 54Council of Australian Governments, 18, 34, 36court decisions, 60CPSU, 57Curra, 78, 79

Ddangerous incidents, 180deaths, 180

road, 74, 75, 77, 79, 88, 89 involving heavy vehicles, 84, 86maritime, 74, 83, rail, 74, 84

Department of Defence, 22, 68, 177Department of Finance, iv, 73, 174 Department of Foreign Affairs and Trade, 175Department of Infrastructure and Regional

Development Enterprise Agreement 2016, 57, 64, 65, 67

Department of the Environment and Energy, 40, 176Department of the Treasury, 9, 10, 167, 170, 174, 185Departmental Consultative Committee, 56, 57Deputy Chief Financial Officer, 56deputy secretary/secretaries, 17, 19, 54, 56, 57disability, people with, iv, 48, 63, 65

employees, 68public transport accessibility guidelines, 38

disposable household income, 76, 94, 95diversity and inclusion, 62, 63, 64, 68

Western Sydney Airport, 92driver training programs, 2, 40driverless vehicles, 35Drought Communities Programme, 47, 170, 185

EEchuca, 28education, Norfolk Island, 52, 97electricity use, 178, 183emissions, see greenhouse gas emissionsEmployee Assistance Program, 179, 180employment, 37, 46, 57, 59, 63, 64, 66–68, 76, 94,

95, 179see also human resources management; jobs

supported by investmentsemployment relations/agreements, 57, 64, 67en route charges payment scheme, 43, 169, 185energy use, 177, 178, 183Enhanced Air Cargo Examination (EACE) notices, 3, 31,

33

201


Enterprise Agreements, 57, 64, 65, 67entity resource statements, 160, 161environment (ecologically sustainable development),

175–178, 183airports, 181Christmas Island mine site rehabilitation, 51shipping, 37, 38, 175see also greenhouse gas emissions

Epping, 28ethical standards, 54, 55, 59, 60, 64European Commission, 31executive director, 19, 54, 55, 57Executive Level (EL), 66, 67

Career Development Strategy, 62conflict of interest declarations, 59EL Mastery Program, 64

Executive Management Team, 18, 54, 55exempt contracts, 173external legal services expenditure, 60external scrutiny, 60–62

FFamily Tax Benefit, Norfolk Island residents receiving,

52fatalities, see deathsFederal Interstate Registration Scheme, 35, 183female employees, 66, 68

Gender Equality Action Plan, 63Fiji, 3, 44finance, 8–11, 56, 60, 160–174

Comcare premium, 179financial statements, 55, 100–157remuneration, 65, 67see also procurement practices

Finance, Reporting and Program Committee, 56Financial Assistance Grants program, 6, 9, 49, 96Flinders, 95flu vaccinations, 180Forum on Western Sydney Airport, 45Foster an efficient, sustainable, competitive, safe and

secure transport system (purpose 2), 15, 16, 20 performance, 74, 80–93

fraud control, iii, 58freedom of information, 60, 173freight, 3, 34–37, 74, 78, 79, 82, 84, 86, 88, 95

air cargo, 6, 30, 31, 33infrastructure, 28, Perth Freight Link, 61shipping, 2, 9, 36, 37, 83, 86see also heavy vehicles

fuelshipping, 37vehicles, 40, 85, 90, 176,

full-time employees, 66, 75, 94, 95, 180

GGender Equality Action Plan, 63gender profile of workforce, 66General Aviation Advisory Group, 43General Counsel, 54general managers, 54, 56, 57Gipps Street, 78Gippsland, 95Glenugie, 78Global Aviation Security Plan, 80–82Goodwood and Torrens Junctions rail project, 28governance, 15–17, 19, 20, 26, 38, 44, 46

corporate governance, 54–60GP visits by Norfolk Island residents, 52Graduate Development Program, 2, 63grants awarded, 60Great Western Highway, 78Green Vehicle Guide website, 90greenhouse gas emissions, 178, 183

international aviation, 176international shipping, 5, 175vehicles, 40, 176; average new light vehicle carbon

dioxide intensity, 75, 88, 90Gympie, 95

Hhealth assessments of employees, 180health services

Indian Ocean Territories, 64Norfolk Island, 50, 52, 68, 97, 98, 171

heavy vehicles, 34,35, 39, 86, 87, 89emissions standards, 40fatalities involving, 84, 86Safety and Productivity Program, 27, 86, 184

Hobart International Airport runway extension, 41, 42, 169, 184

House of Representatives 35, 61questions on notice, 62

household income, 76, 94, 95human resources management, 59, 62–68

average staffing level, 8, 162, 164, 166work health and safety, 57, 179, 180; Psychological

Safety Guidelines, 64Hume Freeway, 28hybrid technology vehicles, 177

Iimported vehicles, 39, 89, 90improving International Aviation Security, 32, 80, 82,

168, 184incidents, injuries, illness or near misses, 180inclusion, see diversity and inclusionincome, 76, 86, 94, 95


ent 202

Norfolk Island residents receiving support payments, 52

see also financeIndian Ocean Territories, 9, 17, 50, 51, 64, 66, 68, 97,

98, 161, 171, 177, 180, 185Registered Nurses Enterprise Agreement, 64

Indigenous Australians, see Aboriginal and Torres Strait Islander peoples

Indigenous Procurement Policy, 172Indonesia, 44, 80–82industry understanding of obligations and risks, 74, 80,

82influenza vaccinations, 180Information Publication Scheme, 60information technology, 19, 56, 68

Christmas Island, 98driverless vehicles, 35Green Vehicle Guide website, 90online learning programs, 64Register of Approved Vehicles database, 39Sense-T project, 95TravelSECURE website, 31WynLens, 49

Infrastructure Australia, 20, 22, 167Australian Infrastructure Plan response, 4, 26, 34

Infrastructure Growth Package, 9, 10, 28, 167, 184Infrastructure Investment, 4, 16, 17, 26–29, 175

activities, 26–29administered items, 184expenses, 9, 10, 162, 167performance, 76–79

Infrastructure Investment Division, 16, 17, 19, 57injuries, time off work per, 180Inland Rail, 3, 4, 27, 29Inland Rail Unit, 16, 17, 19inspections, 2, 30, 39, 87Inspector of Transport Security, 6, 16, 31insurance

airport reviews, 42Comcare premium, 179

interest, conflict of, 59, 60Internal Communications team, 57internal legal services expenditure, 60International Civil Aviation Organization (ICAO), 5, 31,

44, 74, 80, 81, 82, 90, 169, 176, 184International Code for Ships Operating in Polar Waters,

37, 175International Convention for the Safety of Life at Sea, 87international engagement, 5

air transport, 5, 44, 90, 93, 176Airline Licences, 181marine, 175road safety, 39; harmonisation of standards, 88–90surface transport, 35, 37transport security, 5, 30, 31, 33, 81, 82capacity building, 32, 81, 82

International Maritime Organization (IMO), 5, 37, 38, 74, 80, 168, 175, 184

International Oil Pollution Compensation Funds, 38, 175International Transport Forum, 35International Whole Vehicle Type Approval, 39Interstate Road Transport Account, 35, 184Italy, 3, 44

JJervis Bay Territory, 3, 6, 14, 50, 51, 68, 69 76, 97, 98,

171, 177, 185jobs supported by investments, 77, 78, 79

regional program, 94, 95Western Sydney Airport, 92, 93

judicial decisions, 60

KKent Road, 78keys2drive, 2, 40, 168, 184Kidzwish Place, Flinders, 95Kingston and Arthur’s Vale Historic Area, 50, 171, 185 Known Consignor Scheme, 30, 33Knuckey, Geoff, 55

Lland transport market reform, 5, 17, 34, 87last port of call (LPOC) aviation security assessments,

30, 31Launceston, 95learner driver training, 2, 40lease agreements, 8leased airports, see airportslegal decisions, 60legal service expenditure, 60light vehicles, 5, 34, 40, 87

average carbon dioxide intensity, 75, 88, 90trailers, 39

lighting, 177Black Spot Program, 29electricity, 178, 183general vehicle requirements, 39

liner shipping, 36, 37Lions McDonald Hill House, 48Local Government, 6, 9, 14, 18, 20, 26, 46, 48, 49–51,

95, 96, 160activities, 49administered items, 185expenses, 9, 165, 170performance, 95, 95

Local Government and Territories Division, 16, 17, 19Local Government (Financial Assistance) Act 1995, 76,

96, 185Local Government Financial Assistance Grants, 9, 96Local Roads Package, 4location of staff, 66

203


MM4 Motorway, 78M80 Ring Road, 27, 28Malaysia Airlines flight MH370, 10, 19male employees, 66management and accountability, 54–69marine environment, 21, 37, 38, 175Marine Safety (Domestic Commercial Vessel) National

Law Amendment (Cost Recovery) Regulation 2016, 36maritime and shipping, 36–38, 175

Coastal Shipping Reforms discussion paper, 2, 5, 36freight, 36, 37, 74, 83, 86Oakajee Port Common User Services, 29safety, 37, 87security, 6, 30, 31, 74, 80–82

maritime security identification cards (MSIC), 5, 30, 31, 82

market research and advertising payments, 174media advertising organisations, payments to, 174Melbourne Airport, 10, 41, 68, 161, 169, 185Melbourne to Brisbane Inland Rail project, 4, 27, 29mental health promotion, 64, 179Midland Highway, 27Ministerial Forum on Vehicle Emissions, 40, 90, 176Minister, 6, 17, 18, 34, 36, 42, 43, 45, 49, 176 Moama, 28Modernising Airspace Protection public consultation

paper, 3, 43Monash Freeway, 28Monitoring and Evaluation Capability Strategy 2017–20,

59Monitoring and Evaluation Resource Booklet, 59Moorebank Intermodal Company Limited, 10, 20, 68Moreton Bay Rail Link, 4Motor Vehicle Standards Act 1989, 39motor vehicles, see road transportmotorcycle braking systems, 40Murray Basin/River, 28, 170

NNational Awards for Local Government, 49National Capital Authority, 20, 23National Compliance Plan (NCP), 74, 81National Disability Strategy 2010–2020, 65National Heavy Vehicle Regulator, 35, 86, 88, 168, 184 National Highway Upgrade Program, 28National Land Transport Act 2014, iii, 28, 182National Maritime Safety Regulator, 36National Policy Framework for Land Transport

Technology, 35National Road Safety Action Plan 2015–17, 38, 39National Road Safety Strategy 2011–2020, 38

road deaths, 74, 75, 77, 79, 88, 89

National Seamless Economy reforms, 36National Stronger Regions Fund, 2, 47, 61, 170, 185 National Transport Commission, 18, 20, 23, 88, 168 Navigation Act 2012, 87NSW, 10, 29, 41, 66, 78, 95, 97

Department of Education, 52Government, 93, 97

New Zealand, 5, 52, 82non-English speaking backgrounds, employees from, 68non‑financial assets, 68, 69non-ongoing employees, 66–68non‑salary benefits, 65Norfolk Island, 6, 50, 52, 68, 97, 98, 171, 177, 185

Branch, 17Norfolk Island Regional Council, 52, 97, 177North Hub, 78North-South Road Corridor, Adelaide, 27NorthConnex, 4, 27Northern Australia Beef Roads Program, 28, 184Northern Australia Roads Program, 28, 184 Northern Connector, Adelaide, 78NT / Northern Territory, 50, 51, 66, 98, 160, 171, 185 NorthLink WA, 27

OOakajee Port Common User Services, 29occupational health and safety, see work health and

safetyOffice of the Australian Information Commissioner, 60Office of the National Rail Safety Regulator, 84Office of the Norfolk Island Administrator, 50Office of the NT Administrator, 51Office of Transport Security, 6, 16, 17, 19, 57, 82O’Herns Road interchange, 28Oil Pollution Compensation Funds, 38, 168, 175, 184Ombudsman, 61OneSKY, 61ongoing employees, 66, 68operating result, 8–11Orange, 29organisation and structure, 14–23Organisation for Economic Co-operation and

Development (OECD), 35, 168, 184outcomes and programs, 15, 16

expenses tables, 162–71

PPacific Aviation Safety Office, 44Pacific Highway, 27, 78Papua New Guinea, 44, 80, 82parking fines, reimbursement to airport lessee

companies, 42, 169, 184Parks Australia, 51parliamentary committees, 35, 61, 62


ent 204

parliamentary questions on notice, 2, 62part-time employees, 66, 94, passenger screening, 31, 61, 81payments to corporate Commonwealth entities, 9Peninsula Developmental Road, 78People and Performance Branch, 17, 56, 57performance pay, 65performance statements, 72–98Perth Airport, 42Perth Freight Link project, 61Philippines, 32, 80, 82Plan for the Future—Building Australia Fund, 28, 29, 184 plans and planning, 57, 58

airports, 31, 42, 92, 93Australian Infrastructure Plan response, 4, 26, 34Christmas Island crown land management, 51fraud control, iii, 58urban development, 49

Polar Code, 37, 175Policy and Research Division, 16, 17, 19, 57polling/market research payments, 174portfolio, 20–23Portfolio Budget Statements, 10, 57, 58, 73

purposes and outcome set out in, 15Preparing Australia for Automated Vehicles, 35Pride in Diversity, 63Prime Minister, 19, 45, 67procurement practices, 172–174

Employee Assistance Program contract, 179OneSKY Project, 61

Professional Coaching Scheme, 64programs, see outcomes and programsProgress in Australian Regions—Yearbook, 6, 46Promote, plan, evaluate and invest in infrastructure and

regional development (purpose 1), 15, 16, 20performance, 74, 76–79

Property Portfolio and Office Services Management Team, 57

Protection of the Sea (Oil Pollution Compensation Funds) Act 1993, 38, 184

Protection of the Sea (Prevention of Pollution from Ships) Amendment (Polar Code) Bill 2017, 175

protective security, 56, 59see also transport security

Provide good governance in the Australian territories (purpose 4), 15, 16, 20performance, 76, 97, 98

Psychological Safety Guidelines, 64Public Governance, Performance and Accountability Act

2013 (PGPA Act), iii, 8, 22, 55, 59, 72, 73, 173Public Governance Performance and Accountability Rule

2014 (PGPA Rule), iii, 58Schedule 2 list of requirements, 186–191

public office holders, 66Public Service Act 1999, 65, 67

public transport accessibility guidelines, 38publications,

Bureau of Infrastructure, Transport and Regional Economics (BITRE) reports, 2

heavy vehicle charges discussion paper, 5, 34infrastructure investment discussion paper, 4, 26Modernising Airspace Protection public consultation

paper, 43regional development statistics, 6, 46road funding related matters, 85surface transport, 34; Coastal Shipping Reforms

discussion paper, 2, 5, 36vehicle systems, 39, 40

purchasing, see procurement practicespurposes, 15, 16, 20

performance against, 72–98

QQUAD, 31Queensland, 84

Aquatic Recreation Centre, Gympie, 95Bruce Highway, 27, 78Melbourne to Brisbane Inland Rail project, 27, 29Moreton Bay Rail Link, 4Peninsula Developmental Road, Cape York, 78Toowoomba Second Range Crossing, 27Townsville Airport, 42

questions on notice, 62

Rrail, 2, 4, 5, 19, 27, 28, 34, 35

Australian Rail Track Corporation Limited (ARTC), 20, 26, 29, 101

freight, 74, 83, 86; fatalities, 84Melbourne to Brisbane Inland Rail project, 3, 4, 27, 29Western Sydney Airport, 93

Rail Safety National Law (2012), 84recruitment, 63, 64, 67Regional and Remote Airports Security Awareness, 32,

184Regional Australia Institute, 47, 170, 185Regional Development

activities, 46–48administered items, 185expenses, 165, 170performance, 94–96

Regional Development Australia Committees, 3, 47, 170, 185

Regional Development Australia Fund, 47, 170, 185 Regional Jobs and Investment Package, 6, 17, 48, 170,

185Regions 2030, 2, 6, 46Register of Approved Vehicles, 39Registered Automotive Workshop Scheme (RAWS)

approvals, 2, 39Registrar of Liner Shipping, 36Rehabilitation Management System, 179

205


remote air services, 43, 91, 93Remote Air Services Subsidy Scheme, 43, 93Remote Airstrip Upgrade, 43remuneration, 65, 67renewable energy, 178, 183residential aged care, Norfolk Island, 97, 98retention rates, 67risk management, 54, 55, 58Road Safety, 16

activities, 38–40administered items, 184Black Spot Program, 27, 28, 29deaths, 84, 86, 88, 89expenses, 163, 168heavy vehicles, 27, 35, 84, 86performance, 88–90

road transport, 34, 35Bass Strait Passenger Vehicle Equalisation Scheme,

36, 168, 184 departmental vehicle fleet, 177keys2drive learner driver program, 2, 40, 168, 184see also heavy vehicles

roads, 26–29community awareness and understanding of funding

issues, 75, 85, 87cost base, 34Federal Interstate Registration Scheme collection, 35,

183 project performance measures, 77–79in Transport and Infrastructure Council Asset Register,

74, 84, 87Roads to Recovery, 5, 27, 167, 184 role and functions, 14runway projects, 41, 42Rural and Regional Roads Package, 28

SSankeys Road, 78satellite dish, 52scenario planning workshops, 4school buildings, Norfolk Island, 52, 68, 98 Secretary, iii, 17–19, 20, 55–57, 63, 66–68, 181

year in review, 4–7Executive Management Team, 18, 54, 55Secretary’s Business Meeting, 18, 54Senior Executive Service Management Team, 54, 55

security, see transport securitySenate committees, 61, 62Senate questions on notice, 62Senior Executive Service Management Team, 18, 54, 55Senior Executive Service (SES) staff, 54, 55, 58, 66

conflict of interest declarations, 59remuneration, 65, 67

Sense-T project, 95separation rates, 63, 67

Services to Indian Ocean Territories, 9, 50, 51, 171, 177, 185

Services to Norfolk Island, 50, 171, 185 Services to Territories, 16, 185

activities, 50–52expenses, 166, 171performance, 97, 98

sewage, discharging from ships, 175Shergold, Professor Peter, 45shipping, see maritime and shippingShipping Reform (Tax Incentives) Act 2012, 37Singapore, 5small business, procurement initiatives to support, 174Smith, Hon Warwick L, 47South Australia (and/or Adelaide), 27, 28, 47, 66, 78South Bendigo, 48specialist and enthusiast vehicles, 39staff, see human resources managementstatistical reports

regional development, 6, 46workforce data metrics, 62,63

strategic business plans, 58Strategic Information Technology and Security

Committee, 19, 56, 57, 68Strengthen the sustainability, capacity and diversity of

regional economies and support local communities (purpose 3), 15, 16, 20performance, 75, 94–96

Stronger Communities Programme, 48, 170, 185student employment programs, 63Study Assistance Scheme, 64supply chains, 3, 30, 33, 34

cattle, 28Surface Transport, 16,

activities, 34–38administered items, 184expenses, 163, 168performance, 82–87see also rail; road transport; shipping

Surface Transport Policy Division, 16, 17, 19 Sydney Airport Group, 41, 45, 93 Sydney Harbour, 37system tests, 2, 30

TTasmania, 5, 41, 42, 48, 95, 170, 185Tasmanian Freight Equalisation Scheme, 2, 9, 36, 168,

184tax incentives for shipping industry, 37taxation revenue collected, 10, 11technology, see information technologytenders, see procurement practicesTerms of Reference for an Inquiry into National Freight

and Supply Chain Priorities, 34territories, (see Services to Territories)


ent 206

Thailand, 80, 82Toowoomba Second Range Crossing, 4, 27, 28Torres Strait Islanders, see Indigenous Australianstourism, Norfolk Island, 52Townsville Airport, 42Townsville Ring Road, 78training programs

learner drivers, 2, 40staff learning and development, 59, 63–65transport security, 31, 32, 81, 82; Inspector of

Transport Security inquiry, 6TransGrid, 41Transport and Infrastructure Council, 18, 23, 34–36

Asset Register, 74, 84, 87Transport Security, 2, 5, 6, 14, 16, 19

activities, 30–33administered items, 184expenses, 163, 168performance, 80–82

transport security guidance centre, 31, 32Transport Security Operations Branch, 17, 81travel time savings, 74, 77–79TravelSECURE website, 31Treasurer, 10Treasury (see Department of the Treasury)tribunal decisions, 60Tyndale, 78

UUnited Nations vehicle regulations, 89, 90 United States, 6, 30, 31, 33, 82United States Transport Security Administration, 31, 33University Vacation Employment Program, 63unscheduled absence rates, 62, 180Urban Congestion Package, 28Using Value Capture to Help Deliver Major Land

Transport Infrastructure, 26

Vvehicle standards, 39, 40, 75, 88–90vehicles, see road transportVictoria, 28, 48, 95

Melbourne Airport, 10, 41, 68Melbourne to Brisbane Inland Rail project, 27, 29

Victorian Infrastructure Package, 4, 28, 184vision, 6, 15

Wwaste management, 177water use, 177web services, see information technologyWerrington Arterial Road, 78, 79West Gippsland Arts Centre, 95WestConnex project, 4, 10, 26, 27, 61, 167, 184Western Australia, 29, 42, 47, 50, 51, 61, 66Western Sydney, 4Western Sydney Airport, 3, 4, 8, 41, 45, 68, 93

Environmental Impact Statement, 176jobs supported by, 75, 92, 93

Western Sydney Infrastructure Plan (WSIP), 4, 10, 27, 28, 78, 93, 167, 184jobs supported by, 78, 79

Western Sydney Unit, 16, 17, 19White Ribbon Day, 63The Whole Journey, 38Wilson, Bruce, 29women employees, see female employeesWoolgoolga, 78, work health and safety, 57, 179, 180

Psychological Safety Guidelines, 64Work Health and Safety Committee, 56, 57workforce, see human resources managementWorkforce Capability Framework, 64Workforce Strategy 2016–19, 62workplace diversity and inclusion, 62-64, 68workplace relations/agreements, 57, 64, 65, 67workstation assessments, 180World Heritage, 50WSA Co Ltd, 41, 92Wyndham City Council, 49

Yyear in review, 4–7Yelarbon to Gowrie Project Reference Group, 29

Annual Report 2016-17 · 2017–18 FEDERAL BUDGET $8.4 billion secured for Inland Rail and up to...

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Transcript of Annual Report 2016-17 · 2017–18 FEDERAL BUDGET $8.4 billion secured for Inland Rail and up to...