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 are generally valued between $250,000 and $20m, and cover new equipment, modifications to existing equipment or enhancements to new equipment. Minor projects costing between $8m and $20m are approved jointly by the Ministers for Defence and Finance and Administration. The Minister for Defence approves projects costing between $5m and $8m. The Service Chiefs and Group Heads, or their nominated delegates, approve projects costing less than $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 $722.4m in 2005–06, which was $91.0m more than the revised estimate of $631.3m, as detailed in Table 3.7.
The reasons for the variation include:
- changes in the number, value and schedule of minor projects, including slippage of some projects (–$19.5m);
- effort applied to increasing Repairable Items holdings to Serviceable Asset target levels following sustained operational tempo and effects of ageing platforms (+$105.0m); and
- a range of minor variations in the other property plant and equipment (+$5.5m).