Part 2: Expense Measures
Defence
Afghan National Army Trust Fund — contribution
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | 59.3 | 59.3 | 59.3 | 59.3 |
The Government will provide an annual contribution to the Afghan National Army Trust Fund of $US50 million ($A59.3 million) for each of the next five years. This contribution will support the development of the Afghan National Army and strengthen its ability to provide for the security of Afghanistan.
Australian Defence Force Health Care Trial — expansion
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | - | - | - | - |
The Government will provide $44.5 million over three years from 2009‑10 to extend the trial of the provision of basic medical and dental services to dependants of full‑time Australian Defence Force members. The trial will be extended to Townsville, Darwin and Puckapunyal. This expansion will build on the initial phase of the trial for Australian Defence Force dependants at the Tindal, Cairns, East Sale and Singleton bases, and in the Pilbara region.
The trial provides free basic general practitioner services and free basic dental services up to a cap of $300 per dependant per annum. The expanded trial will provide for approximately 16,000 Australian Defence Force dependants.
The cost of this measure will be met from within the existing resourcing of the Department of Defence.
Australian Defence Force systems integration capabilities — improvements
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Defence Materiel Organisation | - | - | - | - | - |
The Government will provide $14.9 million over four years from 2009‑10 to improve the ability of Australian industries to integrate complex technological and operational systems in support of Australian Defence Force capability development.
The cost of this measure will be met from within the existing resourcing of the Defence Materiel Organisation.
Australia‑United States enhanced defence cooperation — humanitarian assistance and disaster relief
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | - | - | - | - |
The Government will provide $7.7 million over four years from 2009‑10 to implement the Australia‑United States Humanitarian Assistance and Disaster Relief Joint Investment Program. The program will increase the ability of both countries to respond to regional natural disasters. This was agreed at the Australia‑United States Ministerial Consultations in February 2008.
The cost of this measure will be met from within the existing resourcing of the Department of Defence.
Coastal surveillance — revised operational structure
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | -0.3 | 2.0 | - | - |
The Government will provide $1.7 million over two years for coastal surveillance activities conducted as part of Operation RESOLUTE. The savings in 2009‑10 arise from changes to the composition of Australian Defence Force units deployed in support of Operation RESOLUTE.
Operation RESOLUTE provides domestic maritime security activities to protect Australia's offshore maritime resources and to deter people smuggling.
Defence savings in the forward estimates period
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | - | -100.0 | -200.0 | -1,700.0 |
Savings of $2 billion over three years from 2010‑11 will be drawn from the Defence budget and returned in the period beyond 2015‑16. This will allow Defence to deliver acquisitions set out under Force 2030, the 2009 Defence White Paper.
Force 2030 sets out a new strategic security assessment to 2030, and plans to build Australian Defence Force strategic capabilities over the long term.
An extensive program of savings and reinvestment will also ensure the achievement and affordability of Force 2030.
See also the related measure, Defence White Paper — new funding model.
Defence White Paper — new funding model
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | - | - | - | - |
The Government has introduced a new long‑term funding model for Defence, consistent with a new strategic assessment and the capability plan set out in the 2009 Defence White Paper, Force 2030. This will provide greater certainty and stability for the Defence budget in the long term.
The White Paper sets out a range of initiatives designed to ensure that Australia has the defence capability required to support future security interests. These initiatives include the acquisition of major new capabilities, far reaching reforms to the Defence organisation and remediation to infrastructure and defence support systems.
The new long‑term funding commitment and the change to Defence indexation will provide Defence planners with a stable clearly defined long‑term funding envelope within which resourcing decisions can be managed.
In 2009‑10, the Government will provide Defence with funding of around $25 billion, not including operations. Over the next decade, the new funding model will provide Defence with total funding of $308 billion.
Over the period to 2029‑30, the Government will provide additional new funding of $146.1 billion to Defence (against funding projections for Defence at the time of the Updated Economic and Fiscal Outlook), in line with its strategic assessment, by:
- continuing the commitment to grow underlying Defence funding by 3 per cent on average in real terms to 2017‑18, with 2.2 per cent average real growth per annum thereafter to 2029‑30
- providing fixed indexation at 2.5 per cent each year to 2020‑30, which accords with the target for consumer price inflation agreed by the Australian Government and the Reserve Bank of Australia, for the purposes of Defence planning
- implementing a comprehensive program of reform, efficiencies and savings, generating around $20 billion worth of savings over 10 years
- reprogramming existing capital acquisitions to meet the new strategic assessment and timetable in the 2009 Defence White Paper
- instituting a commitment by Defence to meet any shortfalls in the White Paper through further internal efficiencies within Defence.
The new funding model will apply from 1 July 2009, with increases resulting from this new indexation over the forward estimates being returned from 2016‑17 onwards, in line with Defence's acquisition timetable for Force 2030.
Defence funding will transition to the new long‑term path over 2013‑14 and 2014‑15. Defence funding will be $1 billion below the new long‑term funding path in 2013‑14, and $500 million lower in 2014‑15 as higher funding levels are phased in. These amounts will be added back to the Defence budget from 2016‑17 onwards.
See also the related savings measure Defence savings in the forward estimates period.
Global supply chain opportunities
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Defence Materiel Organisation | - | - | - | - | - |
The Government will provide $15.3 million over four years from 2009‑10 to assist Australian small and medium enterprises to compete for domestic and international Defence contracts. This will be achieved through training and mentoring industry with the goal of it becoming more competitive, more capable and with increased capacity to be able to compete for and win global supply chain opportunities.
The cost of this measure will be met from within the existing resourcing of the Defence Materiel Organisation.
Global terrorism — enhancing Australia's commitment to Afghanistan
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | 1,083.6 | 118.7 | 49.2 | - |
| Department of Foreign Affairs and Trade | - | 4.1 | 2.7 | 1.8 | 2.1 |
| Australian Federal Police | 1.8 | 2.4 | 2.6 | - | - |
| Total | 1.8 | 1,090.2 | 123.9 | 51.0 | 2.1 |
| Related revenue ($m) | |||||
| Australian Taxation Office | - | -53.3 | -5.1 | - | - |
| Related capital ($m) | |||||
| Department of Foreign Affairs and Trade | - | 0.3 | - | - | - |
| Australian Federal Police | - | 0.1 | - | - | - |
| Total | - | 0.4 | - | - | - |
The Government will provide $1,269.4 million (including $1.8 million in 2008‑09) primarily for the net additional cost of an expanded commitment to Operation SLIPPER, Australia's military contribution to international stabilisation and reconstruction efforts in Afghanistan.
The expanded role will be part of a whole‑of‑government approach, including the eight‑month deployment of an Australian Defence Force taskforce to assist with the conduct of elections in Afghanistan.
Australian Federal Police officers will assist Dutch Military Task Force Oruzgan with the delivery of its police training program.
This measure is also expected to lead to a reduction in revenue of $58.3 million over two years as deployed personnel are taxed concessionally on their base pay and allowances while on deployment.
Iraq — Australian Defence Force embedded personnel commitment in Iraq — cessation
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | -49.5 | - | - | - |
| Related revenue ($m) | |||||
| Australian Taxation Office | - | -0.1 | - | - | - |
In line with the Government's commitment to reduce Australia's military presence in Iraq, the Australian Defence Force's embedded personnel commitment in Iraq will cease by 31 July 2009. The Government will provide $2.2 million to meet the cost of this operation until its cessation.
Funding of $51.7 million in 2009‑10 was previously provided to meet the cost of repair and refurbishment of weapons, vehicles, other equipment and logistics costs for the Iraq operation. These costs are now attributed to operations in Afghanistan.
This measure is also expected to lead to a reduction in revenue of $0.1 million in 2009‑10 as Australian Defence Force personnel are taxed concessionally on their base pay and allowances while on deployment.
Iraq — Australian Defence Force security detachment — funding
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | 59.2 | 12.0 | 2.3 | - |
| Related revenue ($m) | |||||
| Australian Taxation Office | - | -1.8 | -0.2 | - | - |
The Government will provide $73.5 million over three years for the net additional cost of Operation KRUGER, the Australian Defence Force security detachment protecting the Australian Embassy in Baghdad, until June 2010.
This measure is also expected to lead to a reduction in revenue of $2.0 million over two years as Australian Defence Force personnel are taxed concessionally on their base pay and allowances while on deployment.
Land operations in complex environments — improved capacity
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | - | - | - | - |
| Related capital ($m) | |||||
| Department of Defence | - | - | - | - | - |
The Government will provide $70.8 million over four years (including capital funding of $29.1 million) from 2009‑10 to increase the Army's capacity to deploy specialists to conduct field intelligence and information operations in support of land operations in our region.
The cost of this measure will be met from within the existing resourcing of the Department of Defence.
Middle East Area of Operations — command and control enhancements
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | 87.5 | - | - | - |
The Government will provide $87.5 million in 2009‑10 to the Australian Defence Force to improve efficiency in operations by consolidating support assets within the Persian Gulf region.
Military superannuation schemes — reduced number of medical reviews
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | -0.5 | -0.5 | -0.5 | -0.5 |
The Government will reduce the number of medical reviews required each year for the ongoing classification of invalidity pensioners in the military superannuation schemes. All invalidity pensioners will continue to have their invalidity status reviewed at regular intervals.
This measure will provide savings of $2.0 million over four years and $4.9 million over ten years.
Navy workforce — increased capabilty
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | - | - | - | - |
The Government will provide $405.3 million over four years from 2009‑10, and $1.5 billion over a decade, to support the maintenance and development of the Australian Navy's operational capability through the provision of an additional 700 full‑time Navy personnel
The cost of this measure will be met from within the existing resourcing of the Department of Defence.
Priority Industry Capability Centres of Excellence
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Defence Materiel Organisation | - | - | - | - | - |
The Government will provide $9.2 million over four years from 2009‑10 to establish the Priority Industry Capability Centres of Excellence. Defence will work with industry to investigate and develop initiatives, including skilled workforce development and technology incentives that improve defence industry capability or capacity.
The cost of this measure will be met from within the existing resourcing of the Defence Materiel Organisation.
Retention of accommodation on deployment
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | - | - | - | - |
The Government will provide an additional $30.9 million over four years from 2009‑10 to allow eligible Australian Defence Force members to retain their rental accommodation while on deployment. This measure will apply to single members or members living away from their families who are deployed overseas for six months or longer.
The cost of this measure will be met from within the existing resourcing of the Department of Defence.
Superannuation contributions for operations — related allowances
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | 22.5 | - | - | - |
| Related revenue ($m) | |||||
| Australian Taxation Office | - | 3.4 | - | - | - |
The Government will provide $22.5 million for additional superannuation payable under the Superannuation Guarantee (Administration) Act 1992 on allowances paid to Australian Defence Force members serving on overseas operations in 2009‑10. The measure will be funded under the existing 'no win, no loss' arrangements for overseas operations.
This measure is also expected to lead to an increase in revenue of $3.4 million in 2009‑10 from tax on contributions paid by the Department of Defence.
Timor‑Leste — continued funding to help maintain stability
| 2008‑09 | 2009‑10 | 2010‑11 | 2011‑12 | 2012‑13 | |
|---|---|---|---|---|---|
| Department of Defence | - | 191.8 | 18.9 | 0.4 | - |
| Related revenue ($m) | |||||
| Australian Taxation Office | - | -10.6 | -2.3 | - | - |
The Government will provide $211.1 million over three years for the net additional cost of extending Operation ASTUTE, Australia's military contribution to maintaining stability in Timor‑Leste, until June 2010.
This measure is also expected to lead to a reduction in revenue of $12.9 million over two years as Australian Defence Force personnel are taxed concessionally on their base pay and allowances while on deployment.
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