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CHAPTER 3: Defence outcomes and programs

Summary

Australia's defence policy continues to be based on four key strategic interests that are interconnected and contribute to Australia's security. These are a secure Australia, a secure South Pacific and Timor-Leste, a stable wider region, which we now conceptualise as the emerging Indo-Pacific, and a stable, rules-based global order. The ADF's purpose is to contribute to the stability and security of Australia's immediate region and help meet our international obligations, and to deter or defeat attacks on Australian territory. Outcome 1 also encompasses all of the policy, command and support functions undertaken by Defence.

A credible ADF is the basis of the principle of selfreliance in deterring or defeating armed attacks on Australia. Maintaining credible high-end capabilities enables us to act decisively when required, deter would-be adversaries and strengthen our regional influence. To that end, Defence's objectives include the enhancement of core ADF capabilities, including undersea warfare, anti-submarine warfare, surface maritime warfare, air superiority, strategic strike, special forces, intelligence, surveillance and reconnaissance, and cyber security. The objective to prioritise core capability delivery will ensure that the ADF remains one of the most capable forces in our region and can deliver on the Government's priorities.

Major accomplishments over the reporting period included Defence's hosting of two rotations of United States Marines in Darwin, the start of annual Defence minister-level meetings with Indonesia, and the conclusion of Operation Astute in Timor-Leste.

Defence continued to prepare for the Afghanistan transition, with all Afghan National Army brigades in Uruzgan province operating independently from November 2012; and the new amphibious capability was introduced, with the first landing helicopter dock ship, HMAS Canberra, due to enter service in December 2014.

Structure

There are 17 programs under Outcome 1. These include departmental outputs for programs 1.1 to 1.13 and administered expenses relating to retirements, superannuation and housing support services. The program deliverables and key performance indicators tables are assessed using the following key system:

key Description
Met All targets for 2012-13 were met or exceeded.
Substantially met Targets were mostly met and any issues were being managed.
Partially met Some targets were met and any issues were being managed.
Not met No or minimal progress was made against targets.

Table 3.1 - Total cost of Defence Outcome 1

2012-13 budget estimate ¹ $'000 2012-13 revised estimate ² $'000 2012-13 actual result³ $'000 Variation $'000 %
Program 1.1 Office of the Secretary and CDF
Revenues from other sources 1,389 542 3,875 3,333 615
Departmental outputs 168,219 142,928 3150,342 7,414 5
Program 1.2 Navy Capabilities
Revenues from other sources 167,686 241,929 93,433 −148,496 −61
Departmental outputs 4,270,118 4,184,758 4,186,711 1,953 ..
Program 1.3 Army Capabilities
Revenues from other sources 146,748 142,543 188,315 45,772 32
Departmental outputs 5,025,969 5,041,977 5,196,453 154,476 3
Program 1.4 Air Force Capabilities
Revenues from other sources 263,467 290,435 144,787 −145,648 −50
Departmental outputs 4,217,797 4,113,185 4,277,850 164,665 4
Program 1.5 Intelligence Capabilities
Revenues from other sources 12,813 12,729 7,157 −5,572 −44
Departmental outputs 474,357 507,151 539,361 32,210 6
Chief Operating Officer
Revenues from other sources 303,300 314,485 353,802 39,317 13
Departmental outputs 4,845,092 4,977,476 4,919,111 −58,365 −1
Program 1.6 Chief Operating Officer-Defence Support
Revenues from other sources 295,193 302,183 349,197 47,014 16
Departmental outputs 3,688,491 3,647,778 3,660,129 12,351 ..
Program 1.7 Defence Science and Technology
Revenues from other sources 34,039 40,535 35,233 −5,302 −13
Departmental outputs 439,548 441,397 434,070 −7,327 −2
Program 1.8 Chief Operating Officer-Chief Information Officer
Revenues from other sources 8,107 12,234 4,251 −7,983 −65
Departmental outputs 833,021 974,401 908,026 −66,375 −7
Program 1.9 Vice Chief of the Defence Force
Revenues from other sources 244,528 241,241 323,833 82,592 34
Departmental outputs 1,013,394 1,162,672 1,336,670 173,998 15
Program 1.10 Joint Operations Command
Revenues from other sources 374 1,133 106 −1,027 −91
Departmental outputs 43,274 45,546 31,747 −13,799 −30
Program 1.11 Capability Development
Revenues from other sources 87,544 71,118 433,201 362,083 509
Departmental outputs 987,597 230,365 −50,171 −280,536 −122
Program 1.12 Chief Finance Officer
Revenues from other sources 151,354 782,289 823,104 40,815 5
Departmental outputs 458,100 535,769 458,475 −77,294 −14
Program 1.13 Chief Operating Officer-People Strategies and Policy
Revenues from other sources - 68 354 286 421
Departmental outputs 323,580 355,297 350,957 −4,340 −1
Program 1.14 Defence Force Superannuation Benefits
Defence Force Retirement Benefits Act, 1948 Part 1, s.15D and VIC, s.82ZJ ¹ - - - - -
Defence Force Retirements and Death Benefits Act, 1973 Part XII, s.125 ³ 92,344 188,592 115,625 −72,967 −39
Military Superannuation and Benefits Act, 1991 Part V, s.17 1,210,709 2,981,554 3,016,205 34,651 1
Total Administered expenses 1,303,053 3,170,146 3,131,830 −38,316 −1
Administered revenue from other sources 1,215,188 1,250,204 1,213,777 -36,427 -3
Total Program 1.14 87,865 1,919,942 1,918,053 −1,889 ..
Program 1.15 Defence Force Superannuation Nominal Interest
Defence Force Retirement Benefits Act, 1948 Part 1, s.15D and VIC, s.82ZJ ¹ 28,531 18,855 18,800 −55 ..
Defence Force Retirements and Death Benefits Act, 1973 Part XII, s.125 ³ 1,481,844 1,179,857 1,179,000 -857 ..
Military Superannuation and Benefits Act, 1991 Part V, s.17 1,304,763 1,481,327 1,445,000 −36,327 −2
Total Administered expenses 2,815,138 2,680,039 2,642,800 −37,239 −1
Administered revenue from other sources - - - - -
Total Program 1.15 2,815,138 2,680,039 2,642,800 −37,239 −1
Program 1.16 Housing Assistance
Defence Force (Home Loan Assistance) Act, 1990 Part IV, s.38 2,883 2,443 2,264 −179 −7
Defence Home Ownership Assistance Scheme Act 2008 Part VI, s.84 106,353 95,593 93,680 −1,913 −2
Total Administered expenses 109,236 98,036 95,944 −2,092 −2
Administered revenue from other sources 9,963 11,115 14,239 3,124 28
Total Program 1.16 99,273 86,921 81,705 −5,216 −6
Program 1.17 Other Administered
Administered revenue from other sources 116,719 119,110 130,417 11,307 9
Expenses - - 84 84 -
Total Program 1.17 −116,719 −119,110 −130,333 −11,223 9
Total resourcing
Total Departmental outputs 21,943,465 21,383,224 21,480,625 97,401 ..
Total Administered 2,885,557 4,567,792 4,512,225 −55,567 −1
Total Departmental revenue from other sources 1,413,242 2,138,979 2,378,682 239,703 11
Total Administered revenue from other sources 1,341,870 1,380,429 1,358,433 −21,996 −2
Equity Injection - 456,312 456,289 −23 ..
Total resources for Outcome 1 27,584,134 29,926,736 30,186,254 259,518 1
Notes
  1. As published in the Portfolio Budget Statements 2012-13, Table 23.
  2. As published in the Portfolio Budget Statements 2013-14, Table 11.
  3. At the program level, Departmental Revenues from other sources include minor reclassifications from expenses.

Table 3.2 Departmental cost summary for Outcome 1

2012-13 budget estimate ²$'000 2012-13 revised estimate ³$'000 2012-13 actual result $'000 Variation $'000 %
Expenses
Employees 9,571,523 9,605,220 9,691,951 86,731 1
Suppliers 8,595,122 8,970,404 9,168,409 198,005 2
Grants 5,512 10,924 12,036 1,112 10
Depreciation and amortisation 3,883,375 3,683,071 3,999,977 316,906 9
Finance cost 92,591 94,342 85,049 −9,293 −10
Write-down of assets and impairment of assets 1,085,305 1,066,060 800,598 −265,462 −25
Net losses from sale of assets - 7,565 11,642 4,077 54
Other expenses 123,279 84,617 89,645 5,028 6
Total expenses 23,356,707 23,522,203 23,859,307 337,104 1
Income
Revenue
Goods and services 816,581 778,668 735,640 −43,028 −6
Other revenue 70,234 834,566 1,259,255 424,689 51
Total revenue 886,815 1,613,234 1,994,895 381,661 24
Gains
Assets now recognised 521,145 520,744 317,915 −202,829 −39
Reversals of previous asset write-downs 281 - - - -
Other gains 5,001 5,001 65,872 60,871 1,217
Total gains 526,427 525,745 383,787 −141,958 −27
Total income 1,413,242 2,138,979 2,378,682 239,703 11
Departmental cost summary for Outcome 1 21,943,465 21,383,224 21,480,625 97,401 ..
Notes
  1. This table excludes capital payments for outcomes.
  2. Total aggregation of Outcome 1 programs as published in the Portfolio Budget Statements 2012-13.
  3. Total aggregation of Outcome 1 programs as published in the Portfolio Budget Statements 2013-14.