Chapter Four - Outcome Performance > Outcome Seven: Superannuation and Housing Support Services
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Outcome Seven: Superannuation and Housing Support Services for Current and Retired Defence Personnel

Administered Activities

Outcome Seven covers administered activities that Defence performs on behalf of the Government. This outcome contributed mainly to the provision of superannuation and housing support services to current and retired Defence personnel. Defence also administered reimbursements from the United Nations for costs associated with Timor Leste and returns the receipts to the Government.

Outcome 7.1 has been renamed to Superannuation Support Services for Current and Retired Defence Personnel. During the year, two new outputs were added to Outcome Seven to better reflect the different elements and reporting of the outcome. The two new outputs introduced were Output 7.2 - Housing Assistance for Current and Retired Personnel and Output 7.3 - Other Administered Revenues and Expenses.

Output 7.2 is used primarily to report on the administered costs associated with dividends received from the Defence Housing Authority, the Defence housing subsidy payments and any other administered items relating to military personnel housing assistance.

Output 7.3 is used primarily to report on the administered costs associated with interest received on official bank accounts, interest received from United States Government on foreign military sales advances, United Nations revenues and receivables, and net foreign exchange losses and gains.

Details on the performance of Defence's administered activities are outlined below.

Performance Summary

In 2004-05, the net cost of Outcome Seven was $2.048 billion or $336m more than the revised estimate of $1.711 billion. Details by expense and revenue items are provided in Table 4.24, and an output view follows at Table 4.25.

Table 4.24 Outcome Seven - Superannuation and Housing Support Services for Current and Retired Defence Personnel
Budget
Estimate(1)		 Revised
Additional
Estimate(2) 		Actual Result Variation(3) Variation
2004-05 2004-05 2004-05 2004-05 2004-05
$'000 $'000 $'000 $'000 %
Administered Expenses
Subsidies 7,500 9,250 9,177 -73 -1
Employees 2,329,400 2,429,100 2,772,568 343,468 14
Net foreign exchange losses - - 71 71 -
Write down and impairment of assets - - 7,391 7,391 -
Other expenses - - 4,246 4,246 -
Total Administered Expenses 2,336,900 2,438,350 2,793,453 355,103 15
Administered Revenues
Goods and services -2,000 - -7,822 -7,822 -
Interest - - -3,044 -3,044 -
Dividends -45,047 -52,600 -70,672 -18,072 34
Net foreign exchange gains - - - - -
Military superannuation contributions -601,389 -672,405 -661,607 10,798 -2
Other sources of non-taxation revenues - -2,000 -2,793 -793 40
Total Administered Revenues -648,436 -727,005 -745,938 -18,933 3
Cost to Government for Outcome Seven 1,688,464 1,711,345 2,047,515 336,170 20

Notes

  1. Budget Estimates are consistent with the Portfolio Budget Statements 2004-05 (pp 196-97).
  2. The Revised Additional Estimate column shows the full year budget in the Portfolio Additional Estimates Statements 2004-05 including the Portfolio Supplementary Additional Estimates Statements.
  3. The Variation figures are the difference between the Actual Result and the Revised Additional Estimate.
Table 4.25 Cost Summary of Output for Outcome Seven – Superannuation and Housing Support Services for Current and Retired Defence Personnel
Budget
Estimate		 Revised
Additional
Estimate 		Actual Result Variation Variation
2004-05 2004-05 2004-05 2004-05 2004-05
$'000 $'000 $'000 $'000 %
Output 7.1 – Superannuation Support Services for Current and Retired Defence Personnel 1,728,011 1,756,695 2,110,961 354,266 20
Output 7.2 – Housing Assistance for Current and Retired Defence Personnel -37,547 -43,350 -61,495 -18,145 -42
Output 7.3 - Other Administered Revenues and Expenses -2,000 -2,000 -1,951 49 2
Cost to Government for Outcome Seven 1,688,464 1,711,345 2,047,515 336,170 20

An explanation of the significant variations follows.

Output 7.1 - Superannuation for Current and Retired Defence Personnel

This item mainly includes the superannuation services provided for current and retired Defence personnel under the Defence Force Retirement and Death Benefits Scheme and the Military Superannuation and Benefits Scheme. The cost to Government of this output increased by $354.3m due mainly to the inclusion of some new allowances in the definition of salary for superannuation purposes and a higher consumer price index that was assumed at budget. In addition, there was lower than expected military contributions as a result of fewer ADF members than anticipated.

Output 7.2 - Housing Assistance for Current and Retired Defence Personnel

In 2004-05, Defence and the Defence Housing Authority completed the fifth year of an agreement for the delivery of housing services to ADF members. The agreement can be extended until 2010, subject to the Authority meeting agreed key performance indicators in 2006 and 2008. The overall aim of the Defence Housing Authority is to provide a single point for housing and relocation services to ADF members and their families. This includes housing assistance provided for current and retired Defence personnel under the Defence Home Owner Scheme. This scheme provides a subsidy on the interest payable on a home loan for members of the ADF and is covered by the Defence Force (Home Loans Assistance) Act 1990. The actual result is an increased return to Government of $18.1m from $43.4m to $61.5m. This relates to revenue from the Defence Housing Authority for Tax Equivalent Payments for Land Tax and Stamp Duty received on 30 June 2005, which was not included in the revised estimates.
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