Department of Defence
SCHEDULE OF COMMITMENTS
as at 30 June 2008

  2008
$'000
2007
$'000
BY TYPE
Commitments receivable
Lease rental income 1 (28,295) (32,972)
GST recoverable on commitments (739,280) (545,310)
Total commitments receivable (767,575) (578,282)
 
Capital commitments payable
Land and buildings 2 2,104,518 1,540,951
Infrastructure, plant and equipment 3 83,081 122,568
Specialist military equipment 4 16,069,796 10,441,641
Other capital commitments 5 59,197 62,062
Total capital commitments payable 18,316,592 12,167,222
 
Other commitments payable
Operating leases 6 4,294,487 4,588,647
Research and development 7 104,043 129,234
Other non-capital commitments 8 12,464,260 10,793,169
Total other commitments payable 16,862,790 15,511,050
Net commitments by type 34,411,807 27,099,990
 
BY MATURITY
Commitments receivable
Lease rental revenue
One year or less (14,349) (21,944)
From one to five years (5,306) (3,283)
Over five years (8,640) (7,745)
Total lease rental revenue (28,295) (32,972)
 
Other commitments receivable
One year or less (119,493) (175,342)
From one to five years (436,664) (208,532)
Over five years (183,123) (161,436)
Total other commitments receivable (739,280) (545,310)
 
Commitments payable
Capital commitments
One year or less 1,330,897 3,137,934
From one to five years 12,724,552 7,282,365
Over five years 4,261,143 1,746,923
Total capital commitments 18,316,592 12,167,222
 
Operating lease commitments
One year or less 392,672 760,367
From one to five years 1,777,813 1,727,404
Over five years 2,124,002 2,100,876
Total operating lease commitments 4,294,487 4,588,647
 
Other commitments
One year or less 2,437,876 3,292,905
From one to five years 7,282,717 4,940,374
Over five years 2,847,710 2,689,124
Total other commitments 12,568,303 10,922,403
Net commitments by maturity 34,411,807 27,099,990

NOTE:
Commitments are GST inclusive where relevant.

Due to changes in accounting treatment specifically relating to the Defence Housing Australia Services Agreement, a movement of $1,277.46m from operating lease commitments to other non-capital commitments has been applied to the 2006-07 Schedule.

  1. The lease rental income includes rental contributions from Defence service members for residences sub-leased by Defence. The lease term is normally 3 to 5 years. The lease rental receivable is calculated for 28 days which is the minimum period of notice Defence members are required to provide before terminating the lease.
  2. Outstanding contractual payments for buildings under construction.
  3. Infrastructure, plant and equipment capital commitments include outstanding contractual payments for such items of plant and equipment as the maintenance of hardware and software.
  4. Outstanding contractual payments for Specialist Military Equipment under construction.
  5. Other capital commitments include contractual payments for software licence agreements.
  6. Operating leases included are effectively non-cancellable and are described in the table below.
  7. Outstanding commitments on research and development projects including Through Life Support agreements.
  8. Outstanding commitments on supplier type expenditure including general goods and services, communications, domestic and overseas travel and removal costs. The majority of these commitments are payable to DMO.
Nature of leases General description of leasing arrangement
DHA property leases Defence leases residences, under a service agreement, from Defence Housing Australia (DHA) to provide accommodation to eligible service members. The total commitment has been calculated based on an initial forecast of housing demand for the period of the agreement, which is 12 years. Lease payments are subject to the terms and conditions of the lease and are payable to DHA.
Other property leases Defence leases both residential and commercial properties in Australia and overseas in support of its activities. Lease payments are subject to the terms and conditions of the lease. Generally the leases are subject to market reviews, reviews in accordance with agreed indexation or a combination of both. The terms range between 1 year and 99 years.
Aircraft leases Defence leases aircraft in support of scientific and military operations and in support of parliamentary services. Lease terms range between 2 and 12 years.
Motor vehicle leases Leases for the provision of motor vehicles to Senior Executive Officers and for other general service. No contingent rentals exist. There are no renewal or purchase options available to Defence.
Equipment leases Defence has leases for items of equipment including computer hardware, photocopiers and communication equipment. General lease terms are 2 to 5 years.
Property revenue leases Defence receives revenue from the lease of property and office space. Office space is generally let to contractors in support of Defence activities and to other government agencies or to local civic authorities. The terms of these leases range between 1 year and 99 years.

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