Annual Report 2004-05

Other Capital Purchases (-$24.7m)

Other capital purchases comprise minor capital equipment projects, purchase of repairable items and other plant and equipment exceeding the capitalisation threshold of $10,000, other property, plant and equipment, software and intangibles. Minor capital projects cover new equipment, modifications to existing equipment or enhancement to new equipment that are generally valued between $250,000 and $20m. Minor projects costing between $8m and $20m are approved jointly by the Ministers for Defence and Finance and Administration ($8m to $50m for major projects - see p.71). The Minister for Defence approves projects costing between $5m and $8m. The Service Chiefs and Group Heads, or their nominated delegates, approve projects costing below $5m.

Repairable items are items such as engines, gearboxes and components of platforms. These items are acquired to sustain a pool of spares for use while worn and broken items are repaired, maintained or replaced. Other capital equipment also includes purchases of information technology and administrative assets, other property, plant and equipment assets and software and intangibles costing more than $10,000.

Other capital purchases totalled $602.1m in 2004-05, which was $24.7m less than the revised estimate of $626.8m. The reasons for the variation include:

• slippage in minor capital projects (-$13.3m); and
• other minor variations in other plant and equipment purchases (-$11.4m).