Defence: Asset Sales

Senator Chris Evans asked the Minister for Defence, upon notice, on 16 May 2002:

With reference to the sale of Defence assets, the Government's Mid-Year Economic and Fiscal Outlook (MYEFO) document for the 2001-02 financial year indicates that since the 2001-02 Budget there was a decision made to sell additional Defence assets (see attachment B of the MYEFO document, page 33):

1. (a) Can the Minister confirm that the MYEFO indicates that an additional $74 million will be returned to the Government in the 2001-02 financial year through the sale of excess property, and sale and lease-back arrangements; (b) when was this decision taken; and (c) can a list be provided of the additional properties to be sold.
2. (a) Can the Minister confirm that the MYEFO indicates that an additional $272 million will be returned to the Government in the 2002-03 financial year through the sale of excess property, and sale and lease-back arrangements; (b) when was this decision taken; and (c) can a list be provided of the additional properties to be sold.
3. (a) Can the Minister confirm that the MYEFO indicates that an additional $166 million will be returned to the Government in the 2003-04 financial year through the sale of excess property, and sale and lease-back arrangements; (b) when was this decision taken; and (c) can a list be provided of the additional properties to be sold.
4. (a) Can the Minister confirm that the MYEFO indicates that an additional $166 million will be returned to the Government in the 2004-05 financial year through the sale of excess property, and sale and lease-back arrangements; (b) when was this decision taken; and (c) can a list be provided of the additional properties to be sold.
5. (a) Can the Minister explain why the amounts shown in the 2001-02 Defence Additional Estimates Statements, released after the MYEFO, show no increase in the projected proceeds from asset sales to the Government for the 2003-04 and 2004-05 financial years, when compared with the 2001-02 Defence Budget Statement; and (b) why were the measures included in the MYEFO not reflected in the Additional Estimates Statements.

Senator Hill - The answer to the honourable senator's question is as follows:

1. -4.
   1. I can confirm that the MYEFO indicates that the Defence Housing Authority (DHA) would realise from the sale of excess property and from the sale and lease-back program an additional $74 million in 2001-02, $272 million in 2002-03, $166 million in 2003-04 and $166 million in 2004-05. However, as DHA is a Government Business Enterprise and is not funded by direct appropriation, DHA returns funds to the Government in the form of dividends or returns of capital as determined by the DHA Board as part of its corporate planning process and approved by DHA's Shareholder Ministers. Dividends and capital returns to Government include funds derived from a number of sources including, but not limited to, proceeds from the sale of property.
   2. The decision was made on 7 October 2001.
   3. No. DHA has extensive programs for the disposal of surplus properties and the sale and lease-back of properties that are still required to meet the housing needs of the Defence Force. The measures in the MYEFO relate to these programs generally, rather than to any property specifically.
5. 1. DHA is a statutory authority and Government Business Enterprise and, whilst part of the Defence portfolio, is independent of the Department of Defence and does not contribute to the Department's financial statements. The measures in question from the MYEFO relate to property sales by DHA and so are incorporated in DHA's financial statements in the Defence Portfolio Additional Estimates Statements for 2001-02, but not in the Department of Defence's financial statements.
   2. The measures included in the MYEFO are incorporated in DHA's financial statements in the Defence Portfolio Additional Estimates Statements for 2001-02.

close