OVERVIEW

ADF Operations

The Government provided $454.4m in the 2005–06 Budget for the net additional costs of current ADF operations. Funding levels were increased by $113.0m to $567.4m in the 2005–06 Additional Estimates, mainly to fund the deployment of a Special Operations Task Group and an aviation support element to Afghanistan under Operation Slipper, as well as a range of other adjustments. A further adjustment was made in the 2006–07 Budget process where $17.2m of Operation Slipper funding was carried forward in the appropriation receivable to be spent in 2006–07, leaving a revised additional estimate of $545.6m.

Actual expenditure was $516.7m or $28.9m less than the revised additional estimate as shown in Table 1.10.

Table 1.10 Net Additional Cost of Operations

Operation	2005–06
	Budget Estimate	2005–06 Additional Estimate	Revised Additional Estimate	Actual Expenditure	Variation
	$m	$m	$m	$m	$m
Operations in Iraq	402.5	390.3	390.3	351.4	–38.9
Operations in Afghanistan	–	111.8	94.6	91.0	–3.6
Operations in East Timor	4.1	4.1	4.1	23.9	19.8
Anode	8.9	10.9	10.9	12.9	2.0
Relex II	16.4	13.6	13.6	9.8	–3.8
Acolyte	11.4	11.9	11.9	10.4	–1.5
Sumatra Assist	11.1	11.1	11.1	7.5	–3.6
Subtotal Defence Supplementation	454.4	553.7	536.5	506.9	–29.6
Pakistan Assist	–	13.7	9.1	9.8	0.7
Total	454.4	567.4	545.6	516.7	–28.9

Explanations for Variations

Operations in Iraq (–$38.9m)

Operations Bastille and Falconer were Australia's predeployment to the Middle East and its contribution to the coalition-led war in Iraq. In July 2003, the ADF transitioned to Operation Catalyst. Operation Catalyst is the ADF's contribution to developing a secure environment in Iraq assisting national rehabilitation and reconstruction. The 2005–06 Budget initially provided $402.5m for the continuation of operations in Iraq including $198.8m for the Al Muthanna Task Group. Subsequent to the budget, the Government agreed to offset the overspend of $12.2m in 2004–05 from the 2005–06 allocation. This reduced the budget to $390.3m.

Actual expenditure for operations in Iraq in 2005–06 was $351.4m which was $38.9m below the revised estimate due mainly to lower strategic lift costs achieved through more efficient contracting arrangements and lower than estimated equipment remediation costs. Government has agreed that these funds be carried forward to 2006–07 to offset additional equipment requirements.

Operations in Afghanistan (–$3.6m)

Operation Slipper is the ADF's contribution to the international coalition against terrorism. In September 2005, a Special Forces Task Group of about 200 personnel was deployed for 12 months to support the reconstruction and stability of Afghanistan by providing combat patrols of remote regions, reconnaissance and surveillance operations with coalition partners. An aviation support element comprising two CH-47D helicopters and 140 personnel was also deployed as part of the Combined Forces Command in Afghanistan to provide additional aero-medical evacuation and air mobility support to the Special Forces Task Group.

Total funding of $111.8m was provided in 2005–06. This was subsequently reduced by $17.2m, with these funds held in the appropriation receivable to be spent in 2006–07, bringing total funding for 2005–06 to $94.6m. Actual expenditure on operations in Afghanistan for 2005–06 was $91.0m, $3.6m below the revised estimate. This was due mainly to delays in the purchase of equipment for the CH-47 helicopters and lower strategic lift costs achieved through more efficient contracting arrangements partially offset by higher than expected logistic support costs. The Government has agreed to reprogram these funds to 2006–07 to offset additional equipment requirements.

The Government has since announced the deployment of a Reconstruction Task Force to assist in the reconstruction of infrastructure in Afghanistan, with supplementation of $218.2m provided over three years. The aviation support deployment has also been extended until April 2007 and had its scope broadened to include air support to the Reconstruction Task Force.

Operations in Timor-Leste (+$19.8m)

Operation Spire is the ADF contribution to the successor mission to replace the United Nations Mission in East Timor. The operation ceased on 20 May 2005 and the 2004–05 Budget provided $4.1m in 2005–06 for force extraction and remediation costs. Actual expenditure was $1.2m above this due to higher vehicle remediation costs.

Operation Astute is the ADF deployment to stabilise Timor-Leste following violence in Dili in late April 2006. Due to the timing of the operation no supplementation was provided in 2005–06. Defence incurred costs of $18.6m in 2005–06 and will seek reimbursement of these costs in the 2006–07 Additional Estimates.

Operations in Solomon Islands (+$2.0m)

Operation Anode is the ADF contribution to the Regional Assistance Mission to Solomon Islands (RAMSI). The 2004–05 Budget provided $8.9m in 2005–06 for the continuation of the deployment until July 2006. Subsequent to the budget, the Government agreed to reprogram $2.0m from 2004–05 to 2005–06 to take account of timing issues with the remediation of ADF vehicles, bringing the total funding in 2005–06 to $10.9m.

Following the riots in Honiara in April 2006, an increased ADF presence was deployed to Solomon Islands to assist in the restoration of law and order. Actual expenditure for Operation Anode was $2.0m greater than the revised estimate due to the additional personnel allowances and logistic support of the increased ADF presence as well as higher than expected vehicle remediation costs.

Operation Relex II (–$3.8m)

Operation Relex II involves the conduct of air and surface surveillance and interception operations to protect Australia's northern and western borders from unauthorised boat arrivals. Actual expenditure for Operation Relex II was $3.8m less that the allocation due mainly to lower than expected costs for inventory and repairable items.

Operation Acolyte (–$1.5m)

Operation Acolyte is the ADF's contribution to the whole-of-government support of the conduct of the Melbourne 2006 Commonwealth Games in March 2006. The Government provided $13.0m over three financial years for the net additional cost of security support to be provided by Defence, $11.4m of which was allocated in 2004–05. Subsequent to the budget, the Government agreed to the reprogramming of $0.5m of unspent funding from 2004–05.

Actual expenditure for Operation Acolyte was $1.5m below the revised estimate due mainly to lower than expected costs for road transport.

Operation Sumatra Assist (–$3.6m)

Operation Sumatra Assist was the ADF's contribution to the Australian Government effort to provide assistance to the people affected by the tsunami disaster on 26 December 2004. The Government agreed to provide an additional $62.0m over two financial years of which $11.1m was allocated in 2005–06. Actual expenditure for Operation Sumatra Assist was $3.6m below the allocation due to lower equipment remediation costs.

Operation Pakistan Assist (+$0.7m)

Operation Pakistan Assist is the ADF contribution to the humanitarian relief effort in Pakistan following the earthquake in October 2005. An Australian task force comprising 140 ADF personnel and Black Hawk helicopters deployed to Pakistan in November 2005.

Defence estimated that it would incur $13.7m in net additional costs for this operation. Actual expenditure for Operation Pakistan Assist was $9.8m, which was $3.9m below this estimate. Of this, $9.1m was reimbursed to Defence from the DFAT's existing aid budget. The remaining $0.7m was absorbed by Defence.

Status of Funding from all Operations

Table 1.11 provides a summary of the current actual and planned expenditure on operations covering the period 1999–2000 to 2008–09. In summary, the net additional cost of operations announced to date is about $6.0 billion shown at Table 1.10.

Table 1.11 Net Additional Cost of Operations 2005–06

Operation	1999–00 Actual Result	2000–01 Actual Result	2001–02 Actual Result	2002–03 Actual Result	2003–04 Actual Result	2004–05 Actual Result	2005–06 Actual Result	2006–07 Budget Estimate	2007–08 Budget Estimate	2008–09 Budget Estimate	Total
	$m	$m	$m	$m	$m	$m	$m	$m	$m	$m	$m
Operations in East Timor(1)	598.1	798.5	632.9	579.3	554.0	27.4	23.9	–	–	–	3,214.1
Operation Bel Isi	–	20.0	10.1	14.6	3.0	–	–	–	–	–	47.7
Operation Slipper	–	–	320.0	176.0	–5.0	–	91.0	141.7	102.9	27.3	853.9
Operation Relex and Relex II	–	–	22.2	27.8	15.9	11.9	9.8	12.1	–	–	99.7
Operations in Iraq	–	–	–	285.3	240.6	284.9	351.4	347.4	71.0	15.6	1,596.2
Operation Anode	–	–	–	–	90.4	27.6	12.9	3.4	–	–	134.3
Operation Sumatra Assist	–	–	–	–	–	37.0	7.5	–	–	–	44.5
Operation Acolyte	–	–	–	–	–	0.1	10.4	1.0	–	–	11.5
Operation Deluge	–	–	–	–	–	–	–	8.4	11.3	–	19.7
Operation Pakistan Assist	–	–	–	–	–	–	9.8	–	–	–	9.8
Total	598.1	818.5	985.2	1,083.0	898.9	388.9	516.7	514.0	185.2	42.9	6,031.4

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