Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Department of Communications and the Arts—Report for 2018-19
Download PDF
Annual Report 2018-19
COMMS & ARTS
Annual Report 2018-19
COMMS & ARTS
Publication details
© Commonwealth of Australia 2019
The material in this report is licensed under a Creative Commons Attribution—4.0 International licence, with the exception of:
⺠the Commonwealth Coat of Arms ⺠this department’s logo ⺠any third party material ⺠any material protected by a trademark, and
⺠any images and/or photographs. More information on this CC BY licence is set out as follows:
⺠Creative Commons website — creativecommons.org ⺠Attribution 4.0 international (CC by 4.0) — creativecommons.org/licenses/by/4.0. Enquiries about this licence and any use of this report can be sent to copyright@communications.gov.au
Third party copyright
The department has made all reasonable efforts to clearly identify material where the copyright is owned by a third party. Permission may need to be obtained from third parties to re-use their material.
Attribution
The CC BY licence is a standard form licence agreement that allows you to copy and redistribute the material in any medium or format, as well as remix, transform, and build upon the material, on the condition that you provide a link to the licence, you indicate if changes were made, and you attribute the material as follows:
Licensed from the Commonwealth of Australia under a Creative Commons Attribution 4.0 International licence.
Other use
The use of any material from this report in a way not permitted or otherwise allowed under the Copyright Act 1968 may be an infringement of copyright. Where you wish to use the material in a way that is not permitted by this notice, you must lodge a request for further authorisation with the department.
Contact details
This report can be viewed online at transparency.gov.au. For more information about the department and to view other publications visit communications.gov.au.
If you would like additional information on this report please contact:
Assistant Secretary, Governance Branch Department of Communications and the Arts GPO Box 2154 Canberra ACT 2601 Phone: Call via switchboard on 02 6271 1000 Email: planning&reporting@communications.gov.au
Acknowledgements
Special thanks go to all staff involved in producing this report and the following contractors:
Typesetting: [tk] type Printing: Canprint Communications Pty Ltd Editing: The Happy Apostrophe
iii
Letter of transmittal
Secretary
The Hon Paul Fletcher Minister for Communications, Cyber Safety and the Arts Parliament House CANBERRA ACT 2600
Dear Minister
I present the Annual Report of the Department of Communications and the Arts for the year ended 30 June 2019. The report has been prepared in accordance with the provisions of section 46 of the Public Governance, Performance and Accountability Act 2013 for your presentation to parliament.
The following legislation specify additional reporting requirements, which are met in this report:
⢠Australian Broadcasting Corporation Act 1983 (section 24Y)
⢠Commonwealth Electoral Act 1918 (section 311A)
⢠Environment Protection and Biodiversity Conservation Act 1999 (section 516A)
⢠Protection of Movable Cultural Heritage Act 1986 (section 47)
⢠Work Health and Safety Act 2011 (Schedule 2, Part 4)
Our fraud control arrangements comply with section 10 of the Public Governance, Performance and Accountability Rule and the Commonwealth Fraud Control Framework. In accordance with the Commonwealth Fraud Control Framework, I certify that fraud control plans have been prepared and implemented and regular fraud risk assessments undertaken for the department; appropriate mechanisms for preventing, detecting incidents of, investigating or otherwise dealing with, and recording or reporting fraud that meet the specific needs of the entity are in place for the department; and all reasonable measures have been taken to deal appropriately with fraud relating to the department.
Yours sincerely
Mike Mrdak 18 September 2019
Contents
Letter of transmittal iii
Highlights vi
Par t 1: O ver v iew 1
Par t 2 : A nnual per for mance s tatement s 17
Par t 3 : M anagement and accountabilit y 97
Par t 4 : Financ ial s tatement s 117
Par t 5 : A ppendices 1 8 5
Appendix 1 Agency resource statement and expenses for outcomes 186
Appendix 2 Advertising and market research 191
Appendix 3 Workplace health and safety 193
Appendix 4 Report on the Environment Protection and Biodiversity
Conservation Act1999 194
Appendix 5 Compliance with section 24Y of the Australian Broadcasting
Corporation Act 1983 195
Appendix 6 Report on the Protection of Movable Cultural Heritage Act 1986
(section47) 196
Appendix 7 Employee statistics 197
Appendix 8 Disclosure of executive remuneration 209
Par t 6 : Re fer ence infor mation 21 3
Abbreviations and acronyms 214
Glossary of terms 216
List of requirements 219
Index 228
vi C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Promoted the International Year of Indigenous Languages 2019 in celebration of Australia’s Indigenous languages
National Collecting Institutions Touring and Outreach Program 16 exhibitions projected to reach an audience of 645,000
10.4 million in-person visits to the collections of our national cultural institutions
26 Festivals Australia and 367 Regional Australia Fund grants promoted participation in arts for regional Australia
Resale Royalty Scheme Reached $7.2 million in royalties for 1821 artists from19,120 resales of work
Provided $25.7 million to support languages and arts activities through the Indigenous Languages and Arts program
93 Location and Post, Digital and Visual Effects Offsets final certificates issued to eligible productions, with a rebate of around $176 million
126 actors certified for visas under the Foreign Actor Certification Scheme
676 engagements to inform a new National Arts and Disability Strategy
1056 students completed courses at elite performing arts training organisations
Prime Minister’s Literary Awards Celebrating great Australian literature by supporting 35 authors and illustrators
Highlights
vii H i g h l i g h t s
Leased 5793 works from the Artbank collection
$21.7 million over three years from 2018-19 for national cultural institutions to mark 250years since James Cook’s firstPacific voyage
$21.8 million in lending rights payments made to Australian authors, illustrators and publishers
106 organisations added to the Register of Cultural Organisations
481 donations under the Cultural Gifts Program
Facilitated the return of 98 Australian Indigenous ancestors from eight collecting institutions inSweden, the United Kingdom andGermany
Returned an ammonite fossil to the Algerian Government under the Protection of Movable Cultural Heritage Act 1986
Continued to oversee the introduction of new governance arrangements for .au Domain Administration Ltd (auDA)
Our research bureau, the Bureau of Communications and the Arts, published four new papers, helping to provide an evidence base for portfolio policy
Australia re-elected to the ITU Council at the International Telecommunication Union Plenipotentiary in November 2018
Supported Fox Sports to broadcast 5850 hours of women’s, niche and emerging sports
Over 640,000 Australians employed in creative and cultural industries at the most recent census in 2016
viii C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Banned all online lottery and keno betting services
$19.5 million tosupport communityradio
Keeping our Children Safe Online package announced in December 2018
Supported local journalism through the Regional and SmallPublishers Jobs and InnovationPackage
Banned online gambling promotions during TV sporting events in children’s viewing hours
Independent reviews ofABCand SBS found competitive neutrality obligations have been met and bothare considering the efficiencyreview
Review of Australian Broadcasting Services in the Asia Pacific identified opportunities for Australia to provide more media internationally
Review of the online safety regulatory framework Five independent review recommendations made to improve safety online
eSafety Office ⺠Received 531 cyberbullying complaints ⺠Conducted 12,126 investigations into potential prohibited online content
⺠90% of cases of image-based abuse material removed on request
Made over 320,000 classification decisions including 317,550 through the International Age RatingCoalition Tool
Blocked copyright infringing activities in 975 overseas locations
New protections for the disability, educational and cultural sectors assisted over 9500 schools and 41 universities
A new regional connectivity program to grow regional business and digital services announced for 2019-20
ix H i g h l i g h t s
NBN construction increased the number of premises that could order an NBN service by 2.9 million — the biggest construction year to date
725 base stations now complete under the MobileBlack Spot Program, including 155 connected in 2018-19 Maintained our commitment
to telecommunications for all Australians with Universal ServiceObligation Triple Zero Emergency Completed an investigation of May2018 outages
Over 9.4 million calls received to Triple Zero
National Relay Service Around 1.2 million calls connected for hearing or speech impaired callers
An estimated 500,000 people relied on Viewer Access Satellite Television (VAST) each day — our review of VAST recommended arrangements be maintained
Regional Telecommunications Review 10 independent review recommendations made to improve regional telecommunications
Preparing for 5G Four companies win valuable 5G spectrum at auction
Australia Post Delivered over 40 million parcels in December 2018
23 of 27 recommendations completed to implement the government’s response to the ACMA review including cross-appointment between Boards of the ACCC and the ACMA, the Statement of Expectations to the ACMA and its Statement of Intent in response
$2.2 million for the Australian Communications Consumer Action Network (ACCAN) torepresent the views of consumers on communicationsissues
Secretary’s review 2
About the department 10
About the portfolio 13
This part of the report provides a review of the year by the Secretary, information about the department — ministerial arrangements, our role and functions, purpose, outcomes and programs, and structure — and an overview of our portfolio.
Part 1: Overview
2 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Secretary’s review
I am very proud to present the 2018-19 Department of Communications and the Arts Annual Report. Thereport shows the outstanding work in the portfolio for Australian communities. Our purpose is to foster an environment in which all Australians can access and benefit from communications services, creative experiences and culture. This report highlights our significant achievements this year including our performance and financial results.
Developments for the department and portfolio in2018-19
In May 2019, there were some key changes to the portfolio and department. Wewelcomed new ministers: the Hon Paul Fletcher MP, Minister for Communications, Cyber Safety and theArts; and the Hon Mark Coulton MP, Minister for Regional Services, Decentralisation and Local Government.
At the same time we farewelled Senator the Hon Mitch Fifield, our Minister since September 2015; and Senator the Hon Bridget McKenzie, our Minister since December 2017.
The Museum of Australian Democracy at Old Parliament House also began preparationsto move from our portfolio into the Prime Minister and Cabinet portfolio from1 September 2019.
Overview of performance results
Connectivity
Across the globe, connectivity is rapidly transforming the way we live and work and is becoming increasingly critical to the economy and our wellbeing. Our performance results for communications connectivity are presented in detail in Part 2 of this report. This year’s results show Australians have never been better connected and have more communications options available to them than ever before. Our efforts — and, of course, the quality and skills of our Australian industry — are helping to ensure Australia’s communication networks effectively meet consumer demand, support communities and help build a strong economy for Australia.
3 PA R T 1 O v e r v i e w
Increased connectivity goes hand in hand with more online risk and the need to keep people safe. We have increased our efforts to improve cyber safety during 2018-19. InDecember 2018, the government announced a new Keeping our Children Safe Online package, which included an education and support program for those caring for young children and a new research program to inform future cyber safety initiatives. In May 2019, Minister Fletcher became Australia’s first federal government minister for cybersafety. This recognises the key need for public interest protection for our community in the online world.
In March 2019, the terror attacks in Christchurch resulted in government establishing the Taskforce to Combat Terrorist and Extreme Violent Material Online, a joint initiative with industry, charged with providing the government with advice on tangible and concrete measures to tackle the dissemination of this type of abhorrent content online. We co-chaired the taskforce with the Department of the Prime Minister and Cabinet. The taskforce comprised representatives from industry including Google, Facebook, Twitter, Microsoft, Amazon, Optus, Telstra, TPG, Vodafone and Communications Alliance, along with relevant Australian Government agencies and departments.
The final consensus report of the taskforce was publicly released on 30 June 2019 and identified actions under five key pillars of prevention, transparency, deterrence, detection and removal, and capacity building. The report articulated actions to reduce online harms associated with terrorist and extreme violent content that build on the initiatives already taken by industry and government following the attacks. The work of the taskforce has supported Australia’s forward-leaning stance in international forums, in advocating with international counterparts for this issue to be at the forefront of multilateral discussions, and in pushing for firm commitments from industry for improvement. With these and other initiatives, the government is seeking to make our digital environment safer for the millions of Australians engaging online every day, and we will continue to play a lead role in delivering on this objective.
We also completed significant reviews of Australia’s digital online safety legislation and regulation, and are working to implement an updated eSafety regulatory regime.
We increased our efforts to improve cyber safety during 2018-19
4 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
The department continued its oversight of the Australia’s largest infrastructure project, theNational Broadband Network (NBN), which is on track to deliver high-speed broadband to every home and business by June 2020. During 2018-19, the number of premises able to order a service increased by 2.9 million. This took the total number of premises ready to connect to the NBN to more than 9.9 million at 30 June 2019. To improve mobile phone coverage, 155 new mobile base stations came online in 2018-19, a direct result of our Mobile Black Spot Program. We’ve also kept the spotlight on supporting investment in the future of communications. For example, the imminent rollout of 5G represents a transformative step change from previous generations of mobile technology and takes us closer to global hyper connectivity than ever before. During the year, we took a number of steps to support industry to deliver 5G in a timely manner, including holding spectrum auctions in November and December 2018 and continuing our efforts to scale back outdated regulations that are no longer fit-for-purpose.
We released two major reports in December 2018, with the tabling of the Regional Telecommunications Independent Review Committee report and the release of the summary report on the development of the Universal Service Guarantee (USG). The2018 Regional Telecommunications Independent Review Committee received 380submissions from the public and we facilitated 22 face-to-face consultations across Australia, hearing first-hand how Australians living in regional, rural and remote locations use telecommunications services. The USG summary report was the culmination of 12months’ work and concluded the USG is currently best delivered by relying primarily on the NBN for broadband and integrating the current Universal Service Obligation (USO) arrangements. We also selected a new provider for the National Relay Service (NRS) toensure this important service can still be delivered to those who need it. Transition to the new service provider will take place in 2019-20.
One of the many indications that Australians are truly embracing a digital future is the decline in letter volumes, which has continued to fall since peak deliveries in 2007-08. Australia Post is instead managing record numbers of parcel deliveries as a result of online transactions — in December alone, Australia Post delivered a record 40.0 million parcels, up 12% on December 2017.
We have continued our active involvement in international forums. In September 2018, we led the Australian delegation to the Extraordinary Congress of the Universal Postal Union (UPU) in Addis Ababa, Ethiopia. We secured agreement to defer until 2022 proposed additional costs on net importing countries, like Australia. In October to November 2018, we led the Australian delegation to the International Telecommunication Union (ITU) Plenipotentiary Conference in Dubai, United Arab Emirates. We were successful in securing Australia’s re-election to the ITU Council, aswell as ensuring that the conference outcomes aligned with Australia’s policy objectives on international telecommunications. Holding a position on the ITU Council allows us to influence the ITU’s strategic direction on international information and communications technology policies and ensures accountability and good governance ofthe funds that Australia contributes as part of our treaty obligations with the ITU.
5 PA R T 1 O v e r v i e w
Creativity and culture
Throughout the year, the department continued its efforts to support inclusiveness and growth in Australia’s creative sector, and protect and promote Australian content andculture. Our performance results for creativity and culture are presented in Part 2 of this report.
As well as making a profound contribution to our national identity and improving social inclusion outcomes, our creative sector is proving itself to be a significant and growing contributor to Australia’s economy. In October 2018 we released a major report, Culturaland creative activity in Australia 2008-09 to 2016-17, which showed that cultural and creative activity contributed $111.713 billion to the economy in 2016-17.
This year is the International Year of Indigenous Languages (IY2019), which puts a spotlight on preserving and promoting Aboriginal and Torres Strait Islander languages. Our action plan for IY2019 includes supporting the revitalisation and maintenance of Indigenous Australian languages, improving access to education, information and knowledge in and about these languages, and promoting Aboriginal and Torres Strait Islander knowledge and values.
We also made it a priority to start the process of renewing the National Arts and Disability Strategy. To this end we held face-to-face meetings in a range of locations around Australia and sought feedback through a survey, which provided unique andimportant quantitative data about the experience of people with disability accessingand participating in the arts. In total, the consultation involved approximately700 engagements with people with disability, carers and organisations.
During the year we continued to manage dozens of important arts investment and incentive programs including:
⺠the new Location Incentive grant program for international screen productions, which was announced in May2018. Support for five productions was announced during the reporting period; these projects are expected to invest over $400million in our economy, create more than 11,000 jobs and use the services of some 3900 businesses
⺠the Resale Royalty Scheme, which enables Australian artists to receive royalties from eligible resales of their work
⺠the Regional Arts Fund, which supports sustainable cultural development in regional, remote and rural communities in Australia
This year is the International Year of Indigenous Languages (IY2019)
6 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
The diversity and reach of our arts and cultural programs is impressive and we are seeing the real impact they are having in creative settings right across Australia.
Copyright remained a key part of the government’s content framework, providing legal protection for people who express original ideas and information in certain forms. The results from our latest annual consumer survey on online copyright infringement, conducted in March 2019, found recent changes to the copyright framework are having a positive effect — lawful consumption of digital files is on the rise, while unlawful consumption is decreasing for television shows and movies.
The national broadcasters, ABC and SBS, continue to be important contributors to our media sector. During 2018-19, we completed an efficiency review of the broadcasters, and supported the Inquiry into the Competitive Neutrality of the National Broadcasters. The inquiry found the national broadcasters are meeting the ‘best endeavours’ approach to the Competitive Neutrality Policy in relation to their business activities (that is, where there is user charging). It also found there is room for improvement in transparency and internal procedures, and we look forward to working with the national broadcasters to implement these. More broadly, we also continued to implement the media sector reforms including administering the Regional and Small Publishers Cadetship Program, the Regional Journalism Scholarship Program and the Supporting Under-represented Sports program, which formed part of the 2017 Broadcasting and Content Reform Package.
Demonstrating departmental efficiency
In this year’s performance reporting, we’ve introduced information about departmental efficiency. Results against our efficiency measures demonstrate we are delivering more than 90% of our administered items on time and on budget.
Overview of financial results
The department’s net cost of services for 2018-19 was $113.0 million, with revenue from government of $107.8 million, resulting in an operating deficit of $5.2 million. The operating result excluding depreciation was a small surplus of $16,000.
Administered expenses decreased by $19.6 million reflecting a reduction in grants paid under the Mobile Black Spot Program due to delays in base station activations during the year. Administered income increased by $244.0 million primarily as a result of interest received from the government’s loan to NBN Co, which commenced in 2017-18.
7 PA R T 1 O v e r v i e w
Table 1.1 Summary of departmental financial performance and position
2017-18 $ million 2018-19 $ million
Change from last year
Employee and supplier expenses 109.1 111.8 2.5% p
Depreciation 3.9 5.2 34.0% p
Other expenses 11.6 3.3 (71.2%) q
Total expenses 124.6 120.4 (3.4%) q
Revenue from government 104.2 107.8 3.4% p
Other revenue 7.3 7.0 (4.1%) q
Gains 18.7 0.4 (97.8%) q
Total income 130.2 115.2 (11.5%) q
Net cost of services 98.5 113.0 14.7% p
Operating result (loss) 5.6 (5.2) (193.1%) q
Financial assets 25.9 25.0 (3.6%) q
Non-financial assets 66.5 68.1 2.3% p
Liabilities 37.4 39.7 6.1% p
Net assets 55.0 53.4 (3.0%) q
Note: Table totals may not sum due to rounding.
Table 1.2 Summary of administered financial performance and position
2017-18 $ million 2018-19 $ million
Change from last year
Grants 286.7 249.6 (12.9%) q
Other expenses 409.0 400.5 (2.1%) q
Payments to corporate Commonwealth entities 1,762.9 1,788.9 1.5% p
Total expenses 2,458.6 2,439.0 (0.8%) q
Sale of goods and rendering of services 3.7 3.6 (1.9%) q
Interest 71.9 353.4 391.5% p
Dividends 78.5 42.2 (46.2%) q
Other revenue 9.1 8.0 (12.1%) q
Total income 163.2 407.2 149.5% p
Financial assets 32,064.5 34,483.2 7.5% p
Non-financial assets 207.3 196.7 (5.1%) q
Liabilities 390.5 360.7 (7.6%) q
Net assets 31,881.3 34,319.2 7.6% p
Note: Table totals may not sum due to rounding.
Outlook
Our 2019-20 Corporate Plan provides information on our purposes, capability and operating environment for the period 2019-20 to 2022-23. It outlines what we will do to support the Australian Government’s policy, regulatory and program settings, which have a broad influence on enabling economic and social activity. Connectivity, creativity and culture are at the centre of our work plan.
8 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Over the next four years, we will focus on:
⺠implementing the actions identified by the Taskforce to Combat Terrorist and Extreme Violent Material Online to enhance online safety, under the five key pillars of prevention, transparency, deterrence, detection and removal, and capacity building
⺠working with the international community, technology firms, social media platforms and other key bodies, to strengthen the online safety framework
⺠implementing Keeping our Children Safe Online measures, including the Early Years Online Safety Program and the Online Safety Research Program, and overhauling online safety legislation
⺠completing the NBN rollout and managing ongoing public investment in the NBN so that it is sustainable and delivers a high-quality broadband experience
⺠facilitating the introduction of 5G mobile technology ⺠establishing the Regional Connectivity Program and continuing the Mobile Black SpotProgram
⺠continuing to deliver and implement the Australian Government’s reform agenda, including for classification, media, copyright, spectrum and the USG
⺠ensuring the policy and regulatory settings in place reflect the contemporary environment; meet community expectations of consumer experience, public interest protections and public safety; and promote investment and support international competitiveness and the national interest
⺠encouraging sustainability, diversity and recognition of Australia’s creative and cultural sectors for productivity, growth and innovation, including supporting Indigenous arts and culture, Australian literature, the performing and visual arts, Australian screen production and the national collecting institutions
⺠implementing the Australian Music Industry Package, including the Live Music Australia initiative
⺠renewing the National Arts and Disability Strategy During 2019-20, we will continue to build our organisational capability by rolling out a new learning and development strategy to empower our people to learn, develop and grow. Wewill also refresh our Diversity and Inclusion Strategy 2016-2019, to ensure continued relevance for an inclusive workplace.
In closing
I would like to acknowledge and thank the departmental team and our portfolio and industry partners for their vital contributions to connectivity, creativity and culture in 2018-19. I look forward to working with you again in the next reporting period.
Mike Mrdak AO Secretary
9 PA R T 1 O v e r v i e w
10 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
About the department
Ministerial arrangements
From 1 July 2018 to 29 May 2019, we were accountable to:
⺠Senator the Hon Mitch Fifield ⺠SenatortheHonBridgetMcKenzie From 29May 2019 to 30June2019, we were accountable to:
⺠The Hon Paul Fletcher MP ⺠The Hon Mark Coulton MP
Our role and functions
Our role is to provide an environment in which all Australians can access and benefit from communications services, creative experiences and culture. The Administrative Arrangements Order specifies the matters we deal with:
⺠broadband policy and programs ⺠classification ⺠copyright ⺠cultural affairs, including movable cultural heritage and support for the arts
⺠postal and telecommunications policies and programs ⺠spectrum policy management ⺠broadcasting policy ⺠content policy relating to the information economy
Our purposes
We have two purposes.
⺠Connectivity Enabling all Australians to connect to effective communications services and technologies, for inclusiveness and sustainable economic growth
⺠Creativity and culture Supporting inclusiveness and growth in Australia’s creative sector, and protecting andpromoting Australian content and culture
11 PA R T 1 O v e r v i e w
Outcomes and programs
In 2018-19, we administered two outcomes and two programs (Table 1.3).
Table 1.3 Outcome and program structure
Outcome Program Division
Outcome 1: Promote an innovative and competitive communications sector, through policy development, advice and program delivery, so all Australians can realise the full potential of digital technologies and communications services
Program 1.1: Digital technologies and communications services
Content
Market Reforms
Infrastructure and Consumer
Outcome 2: Participation in, and access to, Australia’s arts and culture through developing and supporting cultural expression
Program 2.1: Arts and cultural development
Arts
The Corporate Division and the Strategy and Research Division (not included in Table 1.3) provide enabling functions to support the department to achieve its purposes.
Our structure
Mike Mrdak AO was Secretary of the department for the entire reporting period, having commenced in the role on 18September2017.
At 30June2019, our Deputy Secretaries were:
⺠Richard Eccles, Deputy Secretary,Arts, Content, Strategy and Research ⺠Richard Windeyer, Deputy Secretary, Market Reforms, Infrastructure and Consumer Our organisational chart is at Figure 1.1.
12 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Figure 1.1 Our organisation chart at 30June2019
Secretary Mike Mrdak
Collections and
Cultural Heritage Ann Campton Assistant Secretary Creative Industries Caroline Fulton Assistant Secretary Access & Participation Justine Curnow Assistant Secretary
Strategy & Research
Vicki Middleton First Assistant Secretary
Arts, Content, Strategy
& Research Richard Eccles Deputy Secretary
Market Reforms, Infrastructure
& Consumer Richard WindeyerDeputy Secretary
Corporate Jo Talbot Chief Operating Officer
Bureau of Communications
& Arts Research Leonie Holloway Chief Economist
Strategy Richard Bullock Assistant Secretary
Human Resources Steph Bourke Acting Assistant Secretary Financial Services Sarah Vandenbroek Chief Financial Officer
Information Technology
Maxine Ewens Chief Information Officer Communications
Ben Galdys Assistant Secretary Governance Vanessa Goodspeed
Assistant Secretary Office of the
General Counsel Sarah Godden General Counsel
Content
Dr Carolyn Patteson First Assistant Secretary Classification Aaron O’Neill Assistant Secretary News and Media Policy
Mike Makin Assistant Secretary
Digital Platforms and Online Safety
James Penprase Assistant Secretary
Content and Copyright
Ben Phelps Assistant Secretary
Broadband Implementation
Andrew Madsen Assistant Secretary Consumer Broadband Services
Jason Ashurst Assistant Secretary
Regional Deployment Lachlann Paterson
Assistant Secretary
Consumer Safeguards
Kath Silleri Assistant Secretary
Post and ACMA Rebecca Rush Assistant Secretary Spectrum Cathy Rainsford Assistant Secretary
Competition Tristan Kathage Assistant Secretary Future Connectivity
Philip Mason Assistant Secretary
Market Reforms Pauline Sullivan First Assistant Secretary
Infrastructure
and Consumer Jennifer McNeill First Assistant Secretary
Arts Development
and Investment Sylvia Spaseski Assistant Secretary
Arts
Dr Stephen Arnott PSM First Assistant Secretary
13 PA R T 1 O v e r v i e w
About the portfolio
At 30June2019, the Communications and the Arts portfolio comprised the department and 17portfolio entities.
Table 1.4 Communications and the Arts portfolio entities at 30June2019
Communications Arts
Australian Postal Corporation (AustraliaPost)
Australian Broadcasting Corporation (ABC)
Australian Communications and Media Authority (ACMA)
NBNCo Limited (NBNCo)
Special Broadcasting Service Corporation (SBS)
Australia Council
Australian Film, Television and Radio School (AFTRS)
Australian National Maritime Museum (ANMM)
Bundanon Trust
Creative Partnerships Australia
Museum of Australian Democracy at Old Parliament House (MoAD)
National Film and Sound Archive of Australia (NFSA)
National Gallery of Australia (NGA)
National Library of Australia (NLA)
National Museum of Australia (NMA)
National Portrait Gallery of Australia (NPGA)
Screen Australia
Communications
Australia Post
Australia Post is a government business enterprise wholly owned by the Australian Government. Australia Post is required to provide a high-quality and affordable mail service to all Australians wherever they live or do business. Australia Post also provides parcel, ecommerce and logistics services.
auspost.com.au
14 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Australian Broadcasting Corporation (ABC)
The ABC is a national broadcaster. It contributes to and reflects Australia’s national identity, fosters creativity and the arts, and encourages cultural diversity. The ABC is an integral part of the radio, television and online production industries, and the news and information media.
abc.net.au
Australian Communications and Media Authority (ACMA)
The ACMA is responsible for regulating broadcasting, radiocommunications, telecommunications and online content in accordance with its statutory requirements. The ACMA works with stakeholders to maximise the public benefit, including the extent towhich the regulatory framework addresses the broad concerns of the community, meets the needs of industry, and maintains community and national interest safeguards. The ACMA includes the Office of the eSafety Commissioner.
acma.gov.au
NBNCo Limited(NBNCo)
NBNCo is a government business enterprise, wholly owned by the Australian Government. Its role is to plan, roll outand operate Australia’s National Broadband Network (NBN), whichwill provide all people in Australia with access to high-speed broadband.
nbnco.com.au
Special Broadcasting Service Corporation (SBS)
SBS is a national broadcaster. It provides multicultural and multilingual services that inform, educate and entertain all Australians. Its mission is to contribute to a more cohesive, equitable and harmonious Australia through its television, radio and online services.
sbs.com.au
Arts
Australia Council
The Australia Council’s purpose is to champion and invest in Australian arts. It has a national leadership role in supporting and building Australia’s arts ecology by fostering excellence in the arts and increasing national and international engagement with Australian art and artists.
australiacouncil.gov.au
15 PA R T 1 O v e r v i e w
Australian Film,Television and Radio School (AFTRS)
AFTRS supports the development of a professional screen arts and broadcast culture in Australia, including through the provision of specialist industry-focused education, training and research.
aftrs.edu.au
Australian National Maritime Museum (ANMM)
The ANMM seeks to increase knowledge, appreciation and enjoyment of Australia’s maritime heritage through managing the National Maritime Collection and staging programs, exhibitions and events.
sea.museum
Bundanon Trust
Bundanon Trust supports arts practice and engagement with the arts through its residency, education, and exhibition and performance programs. It also holds an extensive art collection of around 4000 works, including a large collection of artworks gifted to the nation by Arthur and Yvonne Boyd. In preserving the natural and cultural heritage of its site, Bundanon Trust promotes the value of landscape in all our lives. Itis aCommonwealth company limited by guarantee and a registered charity.
bundanon.com.au
Creative Partnerships Australia
Creative Partnerships Australia’s role is to foster a culture of private sector support for the arts in Australia, to grow a more sustainable, vibrant and ambitious cultural sector for the benefit of all Australians.
The Australian Government funds Creative Partnerships Australia to deliver coaching, mentoring and training services and matched funding programs that help artists and arts organisations secure private sector support.
creativepartnershipsaustralia.org.au
Museum of Australian Democracy at Old Parliament House (MoAD)
MoAD promotes the value of Old Parliament House as a significant heritage site, while ensuring the building and heritage collections are preserved for future generations. Themuseum also plays a significant role in exploring and communicating the intrinsic value of democracy.
moadoph.gov.au
16 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
National Film and Sound Archive of Australia (NFSA)
The NFSA collects and preserves Australian film, recorded sound and broadcast, and their associated documents and artefacts. It shares the collection with audiences across Australia and overseas.
nfsa.gov.au
NationalGallery of Australia (NGA)
The NGA maintains and continues to develop a national collection of works of art. It aims to increase understanding, knowledge and enjoyment of the visual arts by providing access to, and information about, works of art locally, nationally and internationally.
nga.gov.au
National Library of Australia (NLA)
The NLA aims to ensure that all Australians can access, enjoy and learn from a national collection that documents Australia’s life and society.
nla.gov.au
National Museum of Australia (NMA)
The NMA develops and maintains a national collection of historical material, and increases awareness and understanding of Australia’s history and culture.
nma.gov.au
NationalPortrait Gallery of Australia (NPGA)
The NPGA aims to increase the understanding and appreciation of the Australian people — their identity, history, creativity and diversity — through portraiture.
portrait.gov.au
Screen Australia
Screen Australia promotes audience engagement and supports a creative, innovative and commercially sustainable screen industry through the funding and promotion of culturally diverse Australian screen product.
screenaustralia.gov.au
Statement of preparation 18
About our performance statements 19
Summary of 2018-19 results 21
Detailed results and analysis of performance 25
How our performance statements accord with our Portfolio Budget Statements 88
Methodology for calculating results against corporate plan performance measures 93
Part 2: Annual performance statements
18 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Statement of preparation
I, Mike Mrdak AO, the accountable authority of the Department of Communications and the Arts for the duration of the 2018-19 reporting period, present the 2018-19 performance statements of the department, as required under paragraph39(1)(a) of the Public Governance, Performance and Accountability Act 2013 (PGPAAct).
In my opinion, these performance statements are based on properly maintained records, accurately reflect the performance of the department, and comply with subsection39(2) of the PGPA Act.
Mike Mrdak AO Secretary 14 September 2019
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 19
About our performance statements
These performance statements report on our performance in the year ended 30June2019, assessed against the purposes and measures published in our revised 2018-19 Corporate Plan and 2018-19 Portfolio Budget Statements (PBS). This is in accordance with subsection 16F(1) of the Public Governance, Performance and Accountability Rule 2014 (PGPA Rule).
The structure of these statements reflects our corporate plan as shown in Figure2.1. Table2.13 identifies where performance information is located and assessed in accordance with the method set out in the 2018-19 PBS.
Figure 2.1 Structure of our performance statements
Corporate Plan PBS
Purpose: Connectivity
Enabling all Australians to connect to effective communications services and technologies, for inclusiveness and sustainable economic growth
In measuring and assessing our achievement of this purpose, we have provided results against and an analysis of:
⺠access to effective communications services (measures 1 to 5) ⺠inclusiveness of communications services (measures 6 to 8) ⺠sustainable economic growth through connectivity (measures 9 to 12) ⺠program resourcing (input), activity and efficiency (measures 13 to 15)
Purpose: Creativity and culture
Supporting inclusiveness and growth in Australia’s creative sector, and protecting and promoting Australian content and culture
In measuring and assessing our achievement of this purpose, we have provided results against and an analysis of:
⺠inclusiveness in creativity and culture (measures 16 and 17) ⺠growth in the creative and cultural sectors (measures 18 and 19) ⺠protecting and promoting Australian culture (measures 20 and 21) ⺠protecting and promoting Australian content (measures 22 and 23)
⺠program resourcing (input), activity and efficiency (measures 24 to 26)
Table 2.13 shows how our performance statements accord with our PBS
20 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
In accordance with the Department of Finance’s instructions in Resource ManagementGuide No. 135: Annual Report for Non-corporate Commonwealth Entities, these statements focus on the results of our activities. Highlights of our activities are presented on pages vi to ix of this report, and in the Secretary’s review on pages 2to9.
Background on our revised corporate plan and new measures
During the 2018-19 reporting period, we updated our activity-based performance criteria to better align with the enhanced Commonwealth performance framework. To achieve complete performance information, we have qualitative and quantitative measures, effectiveness and efficiency measures, and short/medium/long-term measures. Thesestatements address both our activity-based performance measures set out in our 2018-19 PBS and our updated measures set out in our revised 2018-19 Corporate Plan.
The practical considerations behind our updated performance measures were guided by Resource Management Guide No. 131: Developing Good Performance Information.
Delivery
We perform our role, work to achieve our purposes, and deliver results through thefollowing:
⺠Strategic advice and policy development — providing government with the best options and policy advice on issues relating to communications and the arts, including the delivery of services to regional Australia. Our advice is evidence-based and is informed by research, stakeholder consultation and critical analysis of sectoral developments and market trends.
⺠Effective program and grants management — delivering efficient and effective programs, grants and services to achieve the government’s policy outcomes. We adhere to the highest standards of public administration.
⺠Regulatory management — administering portfolio legislation efficiently and effectively. We review and shape regulatory frameworks and we assist our portfolio ministers to fulfil their parliamentary obligations.
⺠Collaborative stakeholder engagement — working with portfolio entities, federal, state and international governments, international organisations, industry, research institutions and the community to generate innovative advice and make sure the advice and services the department delivers are effective and meet the needs of the community. We engage proactively with our stakeholders with a clear understanding oftheir issues and challenges and we value diverse perspectives and ideas.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 21
Summary of 2018-19 results
Table 2.1 is a summary of result ratings against the measures published in our revised 2018-19 Corporate Plan.
Detailed results and analysis of performance follows this table, including further information about 2018-19 targets and previous results.
Table 2.1 Summary of result ratings
Measures Results
Purpose 1: Connectivity
Enabling all Australians to connect to effective communications services and technologies, for inclusiveness and sustainable economic growth
1. Percentage of Universal Service Obligation (USO) targets met by Telstra and community service obligations met by Australia Post
100% in 2018-19 Target
met
2. Percentage of population with access to mobile coverage >99% in 2018-19 Target
met
3. Percentage of premises with National Broadband Network (NBN) access (ready to connect)
86% at 30June2019 (including 95% in regional areas)
Target met
4. Minimum fixed broadband download speeds available to Australian premises Not applicable for 2018-19 First results expected in2020-21
5. Assessment of telecommunications and postal services complaints data Positive results achieved in 2018-19
Target met
6. Assessment of affordability of telecommunications services (mobile and fixed) on offer
Price changes for typical mobile and fixed bundles over 2018-19 showed positive results for most Australians
Target met
22 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Measures Results
7. Impact of our programs on improving connectivity for people with disability We maintained the impact of ourprograms in
2018-19
Target met
8. Assessment of effectiveness of the digital safety regulatory framework Positive results achieved in 2018-19
Target met
9. Percentage of ready-to-connect premises that have taken up NBN 56% in 2018-19 Target
met
10. Assessment of the effectiveness of the department’s international engagement on post and spectrum outcomes
Positive results achieved in 2018-19 Target met
11. Gross domestic product (GDP) contribution enabled by the communications sector $766.328billion in 2016-17a
Target met
12. Investment as a proportion of output in the communications sector 51% in 2017-18 (2017-18 data is the most
current data available)b
Target met
13. Expenses for digital technologies and communications services (program 1.1) $1.847 billion in 2018-19 Target met
14. Assessment of the effectiveness of the department’s oversight of communications portfolio entities
Our oversight was effectivein2018-19 Target met
15. Assessment of whether program 1.1 administered items are delivered efficiently We delivered 14 of 17 program1.1 administered
items on time and on budget in 2018-19
Target not met
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 23
Measures Results
Purpose 2: Creativity and culture
Supporting inclusiveness and growth in Australia’s creative sector, and protecting and promoting Australian content and culture
16. Engagement with the national cultural institutions, indicated through:
(a) number of in-person visits to engage with national collecting institutions (including on- and off-site visits)c
(b) percentage of objects in national collections accessible online
(c) number of website visits to the national cultural institutions
Based on data available to the department at 10September 2019, in 2018-19:
(a) 10.4million
(b) 8.7%
(c) 49.5million
Target met
17. Assessment of the impact of our programs to support inclusion of:
(a) regional, rural and remote Australians
(b) people with disability
Positive results achieved in 2018-19 Target met
18. GDP contribution by the creative and cultural sectors, including:
(a) overall contribution
(b) contribution of broadcasting, electronic or digital media and film
(c) contribution of music composition and publishing
Results against target not available
Results for 2017-18 are not yet available,b but are expected by the end of the year. Results for 2016-17, which were published since our last annual report, are as follows:
(a) $111.713 billion
(b) $9.707 billion
(c) $148.0 million
19. Philanthropic funding to the creative and cultural sectors, including:
(a) estimated private sector support to the arts
(b) to organisations listed on the Register of Cultural Organisations
In 2017-18:b
(a) $319.1million
(b) $135.9million
Target met
20. Number of students successfully completing courses at national elite performing arts training organisations
1056 in 2018 Target
met
24 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Measures Results
21. Assessment of the impact of our programs on supporting, preserving and celebrating:
(a) Indigenous languages and arts
(b) Australian creativity and culture internationally
Positive results achieved in 2018-19 Target met
22. Assessment of the effectiveness of the content regulatory framework for classification, Australian content and copyright
Positive results achieved in 2018-19 Target met
23. Assessment of whether the media regulatory framework is fit-for-purpose Positive results achieved in 2018-19
Target met
24. Expenses for arts and cultural development (program2.1) $712.2 million in 2018-19 Target met
25. Assessment of the effectiveness of the department’s oversight of arts and cultural portfolio entities
Our oversight was effective in2018-19 Target met
26. Assessment of whether program 2.1 administered items are delivered efficiently We delivered all program 2.1 administered items
on time and on budget in 2018-19, indicating efficient delivery
Target met
a In setting the 2018-19 target for measure11, 2016-17 results were expected to be the most current available for 2018-19 reporting. This proved correct.
b In setting 2018-19 targets for measures12, 18 and 19, 2017-18 results were expected to be the most current available for 2018-19 reporting. This proved correct in the case of measures 12 and 19, but results for measure 18 are still not yet available.
c Off-site visits include visits to travelling and outreach programs/supported events/exhibitions (including viewing artworks and cultural objects loaned from collecting institutions).
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 25
Detailed results and analysis of performance
Connectivity: access to effective communications services
Results
Table 2.2 Results for measures related to access to effective communicationsservices
Measures 2018-19 targets Results Previous results
1 Percentage of USO targets met by Telstra and community service obligations met by Australia Post
100% in 2018-19 Target met 100% in 2018-19
100% in 2017-18
2 Percentage of population with access to mobile coverage
Maintain â¥99% in 2018-19 Target met >99% in 2018-19
>99% in 2017-18
3 Percentage of premises with NBN access (ready to connect)
â¥80% ready to connect to the NBN by June2019 (including â¥90% in regional areas)
Target met
86% at 30June2019 (including 95% in regional areas)
60% of 11.7million premises were ready to connect by 30June2018 (including >86% in regional areas)
4 Minimum fixed broadband download speeds available to Australian premises
Not applicable
First results expected in2020
5 Assessment of telecommunications and postal services complaints data
Positive results achieved in 2018-19
Target met
Positive results achieved in 2018-19
Not previously measured
26 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Analysis
We support all Australians, wherever they live or work, to have access to effective telecommunications and postal services.
The work of the department and our portfolio agencies also contributes to Australia’s efforts to achieve the United Nations Sustainable Development Goals. The 2030 Agenda for Sustainable Development was agreed by 193 Member States at the United Nations Sustainable Development Summit in New York in September 2015. Theagenda culminated in 17 clear goals to reach by 2030, which form a roadmap for global development efforts to 2030 and beyond. The goals apply equally to Australia and Australians as they do internationally. Our work to support access to communications contributes directly to Goal 9 — Industry, Innovation and Infrastructure: Build resilient infrastructure, promote inclusive and sustainable industrialisation, and foster innovation; and Goal 11 — Sustainable Cities and Communities: Make cities and human settlements inclusive, safe, resilient and sustainable.
Access to effective telecommunications services
To analyse the effectiveness of our activities to promote access to telecommunications services, we have considered:
⺠our administration of the telecommunications USO, and development of a new Universal Service Guarantee (USG) for the future
⺠our support to improve regional communications, including through: - the Mobile Black Spot Program
- support to the 2018 Regional Telecommunications Review
- support for improved mobile communications service delivery more generally, including emergency telecommunications
⺠our oversight of NBNCo Limited (NBNCo) ⺠information regarding oversight of telecommunications services complaints, informing the telecommunications Consumer Safeguards Review
Universal Service Obligation (USO)
The USO is a long-standing consumer protection to ensure everyone in Australia has access to basic voice telephony regardless of where they live or work. We closely monitor Telstra’s delivery of the USO, which is currently delivered under the Telstra Universal Service Obligation Performance Agreement (TUSOPA). Telstra must provide:
⺠(on request) timely access to a standard telephone service to every premises in Australia ⺠payphone services Our monitoring activities include monthly meetings and analysis of the reporting required under the TUSOPA. In 2018-19, we also commenced an audit of Telstra’s standard telephone services fixed-line connection and repair performance data and processes to further ensure service quality and access are being achieved in line with the USO.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 27
Figure 2.2 Universal Service Obligation 2018-19
Telstra is required to provide annual performance reports. Our assessment of the 2018-19 report determined Telstra met 100% of its performance obligations under the current arrangements (measure1, USO).
Telstra receives $270.0million per year for delivering the USO, comprising $230.0million to deliver standard telephone services and $40.0million to deliver payphone services. In broad terms, payments are a combination of government funding (of $100.0million annually) and funding from industry through the telecommunications industry levy.
Developing the new Universal Service Guarantee (USG)
In December 2017, the Australian Government announced it would develop a new USG to provide all Australian premises, irrespective of location, with access to broadband as well as voice services. A new USG will incorporate the existing USO.
In 2018, we undertook a comprehensive program of work to examine the feasibility and cost implications of different approaches to the USG. Our work found that, while savings could be made in the delivery of voice services by moving away from the existing copper networks in NBNCo’s fixed wireless and satellite areas and using alternative technologies like mobile and satellite, there would be strong concerns in regional areas about the closure of Telstra’s copper network and countervailing costs for NBNCo. A full description of our USG work is in the Development of the Universal Service Guarantee — Summary Report.
In December2018, the Australian Government announced the USG will be built around the NBN supporting broadband services and most voice services. As mentioned above, the USG will also incorporate the existing USO under which Telstra continues to provide voice services outside NBNCo’s fixed-line footprint. Since this announcement, we have been planning and progressing further USG development work, such as market researchinto the use of payphones. We have also been working to progress theproposedstatutory infrastructure provider legislation planned to underpin the broadband component of the USG.
Telstra is the universal serviceprovider
It maintains payphones and is obliged to provide standard telephone services to anyone inAustralia under the USO
Line connections, repairs and payphones
â394,274 new fixed-line services â365,195 fixed-line fault repairs â7260 payphones repaired
28 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Mobile coverage and the Mobile Black Spot Program
Mobile phone population coverage in regional, rural and remote areas of Australia is primarily driven by the investment decisions of the three mobile network operators (Telstra, Optus and Vodafone). This investment is, in turn, influenced by factors such as operator financial position, the cost of infrastructure investment and consumer demand.
As discussed in the Australian Communications and Media Authority (ACMA) Communications Report 2017-18, released in February2019, mobile coverage now reaches more than 99% of Australia’s population (measure2). This is around 32.5% of thecountry’s geography. Competitive private sector investment has delivered quality mobile outcomes for the majority of Australians.
To encourage mobile coverage in small communities and along regional transport routes, we provide financial incentives through administering the MobileBlackSpot Program. TheAustralian Government has committed $380.0million to the program from 2015-16 to 2022-23, including $160.0million for two new rounds, rounds5 and 6. Round5 guidelines were released in April2019. Round6 is expected to commence after the round5 process is complete.
Under the first four rounds of the program, the government’s commitment has leveraged a total investment of more than $760million, which is funding delivery of 1047 new base stations across Australia. At the end of June2019, 725 new base stations had been deployed, including 155deployed during 2018-19.
The base stations deployed through the program at the end of 2018-19 are providing more than 146,000km2 of new handheld coverage, improved mobile coverage to an estimated 91,698 premises and 7557km of major roads coverage across regional and rural Australia.
Figure 2.3 Mobile Black Spot Program 2018-19
Additional rounds of the Mobile Black Spot Program, to the value of $160.0million, will be funded under a $220.0million Stronger Regional Digital Connectivity Package. Thispackage also includes $60.0million for a new Regional Connectivity Program. This is part of the government’s response to the 2018 Regional Telecommunications Review — Getting It Right Out There, which we supported throughout 2018.
725 new base stations deployed under the program
including 155 in 2018-19
New and improved coverage at June 2019 to around
146,000km2 of handheld coverage 91,698 premises 7557km of major roads
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 29
We are currently developing the Regional Connectivity Program on a place-based model, targeting investment to maximise economic opportunities and benefits for regional, ruraland remote Australians.
Improved emergency telecommunications
Australians use their mobile phones to access services, including emergency services.
We supported the government to amend the Telecommunications Act 1997 in March2019 to improve access to telecommunications for emergency organisations and help carriers provide services in emergencies.
Emergency service organisations are now able to access NBNCo towers and related infrastructure. This means fire, police and ambulance services will be able to more readily deploy telecommunications equipment, improving their ability to protect the community.
Also, the Minister can now specify temporary facilities, including temporary towers, aslow-impact facilities in an emergency and other circumstances. This means that in timesof emergency, telecommunications carriers will be able to deploy temporary facilities more readily, and continue to provide services to the community in times of need.
National Broadband Network (NBN) and NBNCo
The NBN is ensuring all Australians have access to high-speed broadband services. NBNCo, the company responsible for planning, rolling out and operating the NBN, isagovernment business enterprise. We support the Minister in providing shareholder oversight of NBNCo’s work. In cooperation with the Department of Finance, we monitor NBN rollout, consumer migration and consumer experience, as well as the policy and regulatory settings relating to the NBN. We also provide advice to the Minister on the government’s financial investment, including NBNloan settings.
Publicly reported information from NBN Co shows that positive consumer experience on the NBN increased over 2018-19. For example, NBN connections completed correctly the first time were 91%, remaining relatively steady across the year. During 2018-19, theagreed timeframes for installations were met 96% of the time, and agreed timeframes for fault restorations were met 91% of the time. This was a slight improvement compared to 2017-18. Fault rates reported by NBN Co declined by over 30% to an average of 0.6faults per 100 connected homes and businesses in June 2019, compared to 0.9faults in June 2018. These figures reflect the impact of efforts by regulators, industry and government to address issues affecting the consumer experience, including the ACMA’s implementation of rules governing NBN complaint handling.
NBNrollout information is published in NBNCo’s weekly progress reports. At30June2019, 5.5million premises were using services provided over the NBN. Approximately 86% of Australia’s 11.6million premises were ‘ready to connect’ to NBNservices, including 95% in regional areas (measure3). A total of 2.9million additionallots/premises were made ready to connect during the year.
30 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Figure 2.4 National Broadband Network 2018-19
Telecommunications services complaints
Telecommunications services complaints data provides valuable insight into the effectiveness of services. Assessing the 2018-19 results, we considered trends in complaints to industry and complaints escalated to the Telecommunications Industry Ombudsman (TIO).
On 1 July 2018, new record keeping rules, which were developed and which are enforced by the ACMA, came into effect to enable monitoring of industry complaints-handling performance. The data collected under the rules for the first and second quarters of 2018-19 showed that there was a 10.2% increase in complaints per service in operation between quarters. This data provides a baseline for future reports by the ACMA. This will inform our future policy development.
In the previous reporting period (2017-18), there were 167,831 complaints made to the TIO. Between 2015-16 and 2017-18, complaints to the TIO increased year on year, after having declined from a high of 197,682 in 2010-11.
As at 30 June 2019, the TIO had released information about complaints it had received in 2018-19 up to December 2018. Between July and December 2018, the TIO recorded 60,998 new complaints, an approximately 27% decrease on the number of complaints it received during the preceding six-month period from January to June 2018.
The TIO’s reporting noted complaints about each of the three key service types (landline, mobile and internet) all decreased on the previous six-month reporting period. However, while overall an assessment of complaints showed positive results (measure 5, telecommunications complaints), towards the end of the July to December 2018 reporting period there was a slight increase in complaints about internet services against the general downward trend.
In relation to services delivered over the NBN, the TIO’s reporting showed the number of connection or changing provider complaints has remained at below1% of premises being added to the network. It also showed there has been a sustained decrease in the number of service quality complaints as a proportion of total premises on the network.
5.5 million premises were connected at 30 June 2019
plus 2.9 million premises were made ready to connect in 2018-19
Fast broadband for all Australians
At 30 June 2019, 2.0 million premises were connected outside urban areas
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 31
During 2018-19, Communications Alliance released quarterly telecommunications Complaints in Context reports based on data provided by the TIO. The reports cover five participating providers (Telstra, Optus, Vodafone, amaysim and Pivotel). They provide information on complaints about each provider to the TIO as a proportion of the services the provider has in operation.
The reports published in 2018-19 showed a general downward trend until the January to March2019 quarter, where Telstra, Optus and Vodafone experienced an increase in new complaints (data for amaysim and Pivotel remained mostly steady). In releasing the January to April2019 figures, Communications Alliance noted results for that quarter’s report had been influenced by adverse weather events and natural disasters over the reporting period.
Telecommunications Consumer Safeguards Review
Since the turn of the century, the Australian telecommunications industry has been undergoing an unprecedented transformation driven by new technologies, increased competition, rapidly changing consumer preferences and change in industry structure caused by the rollout of the NBN. During 2018-19, we continued progressing the telecommunications Consumer Safeguards Review, including consideration of the effectiveness of existing safeguards, and what future protections are required.
After a consultation period on the review’s first tranche of proposals, in November2018 the Australian Government released our report and recommendations on complaints handling and redress in the telecommunications industry. Since the report’s release, we have been working with industry, regulators and the TIO to improve the telecommunications complaints-handling, resolution and redress framework.
We also released a discussion paper on proposals to reform reliability of services in November2018, and we have been engaging with industry, consumer groups and regulators on reliability safeguards.
Access to effective postal services
To analyse the effectiveness of our activities to promote access to postal services, wehave considered our:
⺠oversight of Australia Post ⺠oversight of postal services complaints
Australia Post
Australia’s postal market is competitive for most services but Australia Post has an exclusive right to deliver letters. We administer the Australian Postal Corporation Act 1989 and the Australian Postal Corporation (Performance Standards) Regulations 2019. IncooperationwiththeDepartmentofFinance, we also provide oversight of Australia Post as a government business enterprise.
The Australian Postal Corporation Act requires Australia Post to meet community service obligations, including performance standards defined in the regulations.
32 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Thoseperformance standards include requirements about frequency, accuracy and speed of mail delivery, street posting boxes and retail outlets.
Australia Post provides us with quarterly updates on how it is tracking against its community service obligations. Performance information for the year is published in Australia Post’s annual report. As at 30June2019, quarterly reports to end March2019 had been provided to the department. Our assessment of these quarterly reports determined that Australia Post has to date met 100% of its 2018-19 community service obligations (measure1, community service obligations).
Figure 2.5 Australia Post 2018-19
Postal services complaints
We monitor reporting on postal services complaints as an indicator of the health of the postal industry. In April2018, the Postal Industry Ombudsman (PIO) published a report titled Review of Australia Post complaints about carding, Safe Drop and compensation. The report made sixrecommendations about how Australia Post could improve its complaint handling. InJune2019, the PIO published its Follow-up report on Australia Post’s response to the Ombudsman’s recommendations, which found Australia Post had made significant progress in implementing improvements. The report noted a 30% reduction in complaints to the PIO about Australia Post in the first half of 2018-19 compared to the same period in 2017-18. This is evidence of a positive result in 2018-19 (measure5, postal complaints).
The PIO noted that while the number of complaints Australia Post received directly in 2017-18 was unchanged from 2016-17 (1.1million), parcel volumes grew by over 10% in the same period and the number of complaints received by the PIO decreased by 10%. Complaints to the PIO about Australia Post and its subsidiary StarTrack have continued to decline since their peak in 2014-15.
Meeting community service obligations
Around 15,000 street posting boxes More than 4000 retail outlets
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 33
Figure 2.6 shows Australia Post complaints received to the PIO from 2007-08 to 2017-18. Data for 2017-18 is the latest available full-year data at the time of writing.
Figure 2.6 Australia Post complaints received to the Postal Industry Ombudsman
2000
3000
4000
5000
6000
2017-18
2016-17
2015-16
2014-15
2013-14
2012-13
2011-12
2010-11
2009-10
2008-09
2007-08
3772
34 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Connectivity: inclusiveness of communications services
Results
Table 2.3 Results for measures related to inclusiveness
Measures 2018-19 targets Results Previous results
6 Assessment of affordability of telecommunications services (mobile and fixed) on offer
Price change for typical mobile and fixed bundles over 2018-19 shows positive results
Target met
Price changes for typical mobile and fixed bundles over 2018-19 showed positive results for most Australians
Affordability improved in aggregate and for most vulnerable groups between 2006 and 2015. Consumers are getting better value as prices stay the same or fall, while product inclusions increase
7 Impact of our programs on improving connectivity for people with disability
Impact maintained or increased in 2018-19
Target met
We maintained the impact of ourprograms in 2018-19
Not previously reported
8 Assessment of effectiveness of the digital safety regulatory framework
Positive results achieved in 2018-19
Target met
Positive results achieved in 2018-19
Not previously measured
Analysis
To analyse the effectiveness of our activities in increasing Australians’ participation in and access to communications services, we have considered:
⺠affordability of telecommunications services ⺠access for people with disability ⺠our digital safety regulatory framework
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 35
Affordability of telecommunications services
Communications services are essential to meaningful participation in our economy, society, education and democracy. The affordability of those services is a key element ofdigital inclusion.
To analyse the affordability of telecommunications services, we have considered:
⺠trends found in recent Australian Competition and Consumer Commission (ACCC) reporting
⺠telecommunications affordability indexes, which revealed the price change for typical mobile and fixed bundles over 2018-19 showed positive results for most Australians
⺠NBN pricing
Australian Competition and Consumer Commission (ACCC) reporting
Under section151CM of the Competition and Consumer Act 2010, the ACCC must monitor and report each year on telecommunications charges paid by consumers. These reports inform our policy development and underpin our regulatory settings.
The most recent report, the ACCC Communications Market Report 2017-18, was released in February2019. It found affordability is improving, with the prices of telecommunications services falling in real terms in 2017-18 compared to 2016-17 across most categories. Forexample, in 2017-18 a consumer would typically have paid, in real terms, 8.3% less for a mobile plan and 1.5% less for a fixed broadband plan than in the preceding year.
Forfixed broadband services:
⺠NBN prices reduced by 4% in real terms, when comparing similar NBN retail plans ⺠non-NBN fixed broadband prices increased slightly, in real terms, by 0.5%
Affordability indexes
We track a range of affordability indexes. These indexes are based on the Household, Income and Labour Dynamics in Australia (HILDA) Survey. They show in 2017, the most recent year for which data is available, that the affordability of communications services improved for the average household, and for typical mobile and fixed bundles (measure6). The share of disposable income spent on communications services decreased from 3.5% in 2016 to 3.3% in 2017. Over the same period, there was a slight increase in the proportion of low-income households spending a large amount of their disposable income on communications services (which is defined as spending a share of income on communications services more than three times the median share for the whole population). Similarly, there was a slight increase in the proportion of low-income households potentially under-utilising communications services.
36 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
National Broadband Network (NBN) pricing
We have policy and shareholder oversight of NBNCo, including wholesale pricing of NBN services. Wholesale pricing contributes to the retail prices consumers pay for fixed broadband plans. NBNCo’s current pricing strategy seeks to find the right balance between enabling retail providers to offer quality services at affordable prices on a sustainable basis, and enabling reinvestment in NBNCo’s network.
At 30June2019, wholesale pricing for NBN Co’s 50/20 megabits per second plan, which was taken up by approximately 51% of households connected to the NBN, was$45permonth.
We also have policy responsibility for licence conditions placed on Telstra which, among other things, requires it to have a Low-Income Measures Assessment Committee.
Access for people with disability
We maintained the impact of ourprograms in 2018-19 by continuing to deliver the National Relay Service (NRS) and maintaining the framework for captioning (measure7). To analyse the effectiveness of our programs to improve connectivity for people with disability in 2018-19, we considered:
⺠the NRS ⺠reporting by free-to-air television broadcasters on captioning compliance ⺠progress towards audio description for Australian television
National Relay Service (NRS)
The NRS, which is provided under contract and funded from our Public Interest Telecommunications Services Special Account, allows people who are deaf, hard of hearing and/or have a speech impairment to make and receive phone calls. The NRS relayed approximately 1.2 million calls in 2018-19. Costs incurred under the contract in 2018-19 totalled $28.2 million. These costs were fully recovered through the telecommunications industry levy.
We prepare provider performance quarterly reports, which are accessible from our NRSwebpage. These indicate usage of the service was steady in 2018-19, and consistentwith 2017-18 in relation to call minutes, total calls made and emergency service calls. A trend that has become well-established in previous years relates to the growing use of Internet Protocol-based technologies. Captioned relay accounts for the bulk of the NRS calls made, and the next most used technologies are internet relay (including use of the NRS app) and text message relay. This suggests NRS users, like other telecommunications consumers, are willing to select from the range of alternative low-cost, ubiquitous technologies on offer to meet their telecommunications needs.
The shift from quarterly to monthly reporting and invoicing provided us the opportunity for more frequent review of the delivery of the NRS relay component by the contractor, AustralianCommunication Exchange Ltd (ACE). We have also taken over responsibility
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 37
for NRS information activities and launched Accesshub in February2019. Accesshub is located on our website and provides information about the communication options available for people who are deaf or have a hearing or speech impairment.
In June2019, following a limited tender process for provision of the NRS, we awarded Concentrix Services Pty Ltd the new contract, to be taken over in a staged transition commencing in November2019. The new contract provides for improvements to the current service, including a new ‘text and listen’ option for text message relay. All existing relay channels will continue to be available for NRS users with the exception of captioned relay options through the CapTel handset. New captioned relay options for internet relay calls are becoming available as part of the new contract.
Television captioning
We advise the government on policy for television captioning, while the ACMA is responsible for administering captioning regulation.
As at 30June2019, the ACMA had released information about captioning compliance for 2017-18. For this period, the ACMA stated that all subscription TV services reported compliance with their captioning targets and free TV services reported a high level of compliance with their captioning target requirements.
Television audio description
Audio description is a verbal commentary that complements an underlying video soundtrack to provide greater access to television content for people who are blind or vision impaired. In March2019, the Australian Government wrote to free-to-air broadcasters and FreeTVAustralia inviting them to propose a plan for the introduction ofaudio description. This followed a report by the Audio Description Working Group, which we chair, released in 2018.
Based on this information and our advice, the government is carefully considering the way in which audio description can be best introduced.
The digital safety regulatory framework
We work on effective consumer safeguards and protections for the digital environment to support Australians to interact safely online.
To analyse the effectiveness of our digital safety regulatory framework, we considered:
⺠online gambling regulation and data showing the spending by Australians on illegal offshore gambling websites
⺠the effectiveness of restrictions on gambling promotions during live televised sportingevents
⺠data from the Office of the eSafety Commissioner and results from the national eSafety survey
Data informing these areas of considerations show positive results in 2018-19 for the effectiveness of the digital safety regulatory framework (measure8).
38 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Online gambling regulation
Government policy is to bring individuals who gamble into the Australian regulated market where harm minimisation measures have been strengthened, particularly since the commencement of the National Consumer Protection Framework for Online Wagering in November2018.
Australians should be aware there are limited harm minimisation and consumer protections on gambling websites that are not licensed and regulated in Australia. Consumers run a high risk of winnings or deposits not being paid out by disreputable operators. As the services are based overseas, there is little legal recourse for Australian customers.
In the previous reporting period, the ACMA established an Interactive Gambling Taskforce, which has targeted education, engagement and enforcement action to disrupt and deter prohibited and unlicensed offshore gambling services. In October 2018, the taskforce published its report Disrupting Illegal Offshore Gambling.
The report shows the investigation and enforcement activity of the taskforce has had the greatest impact in disrupting offshore gambling. Investigations were conducted into 138websites. Of these, 58% were not providing services into Australia. This figure rose to 83% following ACMA compliance action. This approach led to the withdrawal of prominent offshore gambling sites from the Australian market, including 33 of the most popular wagering sites and 33 of the most popular gaming sites, and a downward trend in offshore gambling expenditure by Australians. Figure 2.7 shows the forecasted decrease in monies spent on offshore gambling websites by Australian consumers.
Figure 2.7 Australian offshore gambling — Global Betting and Gaming Consultants (GBGC) dataset (gross gambling yield US$ million)
100
200
300
400
500
600
700
800
900
2019 (forecast)
2018 (forecast)
2017
(preliminary)
US$ million
2016
Source: ACMA (October 2018). Disrupting Illegal Offshore Gambling: 12-month report into the ACMA’s actions under the Interactive Gambling Act 2001, page 11.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 39
In 2018-19, we consulted with industry stakeholders on other disruptive measures including the blocking of illegal offshore wagering websites. Once implemented, the scheme will complement the ACMA’s enforcement actions and will help reduce the provision of illegal wagering services to Australians.
In January2019, the Interactive Gambling Act 2001 was amended to prohibit betting onthe outcome of lottery and keno draws.
Restrictions on gambling promotions during live sporting events
We developed a new legislative framework to allow for stronger gambling advertising restrictions during the previous reporting period.
In March 2018 new restrictions were developed by the ACMA in consultation with broadcasters, which prohibit gambling promotions during live sporting events within certain hours. The new restrictions reduce audience exposure to gambling advertisements, particularly during children’s viewing hours.
In September 2018 rules developed by the ACMA under the new legislative framework came into effect, which restrict the showing of gambling promotions during online streams of live sporting events. These restrictions are, to the extent possible, similar to those imposed on the broadcast of live sporting events. These rules mark the first time ‘broadcast-like’ programming standards have been applied to online services.
Industry compliance with new restrictions will be made publicly available in the ACMA’s 2018-19 Annual Report. To date, the ACMA reported zero breaches of the new restrictions by broadcasters. This demonstrates that broadcasting providers are complying with their gambling promotions obligations, and so child audiences are less exposed to gambling promotions during the time periods they are most likely to view live sporting events.
Online safety
The government established the Office of the eSafety Commissioner in 2015, with a mandate to coordinate and lead online safety efforts across government, industry and thenot-for-profit sector. The office provides eSafety information and resources for Australians on its website. In 2018-19, the number of visits to the eSafety office’s website grew to 1.2million, up 56% compared to 2017-18. This increase indicates messages promoting online safety are being delivered toa strongly growing audience.
A key role of the Office of the eSafety Commissioner is to receive complaints by Australians about offensive and illegal online content. In 2018-19, the eSafety office received 531reports of cyberbullying and 950reports of image-based abuse. Comparedto 2017-18, these figures increased significantly. Theoffice investigated 12,126 items of prohibited and potential prohibited content in2018-19.
40 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Overall, these results indicate a strong and growing awareness of eSafety among the Australian public and a growing take up of services to assist Australians.
The statutory review of the EnhancingOnlineSafety Act 2015 and Schedules 5 and 7 tothe BroadcastingServices Act 1992, undertaken by MsLynelleBriggsAO in 2018 (theBriggsReview), found the Office of the eSafety Commissioner has been very successful since it was established in 2015.
The review also concluded Australia’s current regulatory arrangements need to be modernised to ensure they are fit-for-purpose in the current digital environment and are consistent with community expectations. The review findings are guiding our work to update Australia’s online safety regulatory framework and bring forward a consolidated OnlineSafety Act. The rapid pace of change in the online environment means it is important to keep reviewing and adapting our regulatory settings.
The National Online Safety Awareness Campaign, Start the Chat, proved effective at raising awareness of the importance of having a conversation with children and young people about online safety. It also increased awareness about resources available at the eSafety website.
Another key development was our release of the OnlineSafety Charter — Consultation Paper inFebruary2019. When finalised, the charter will be an important foundation document to shape the direction of future reform of online safety policy and legislative arrangements in Australia. The charter will be voluntary. It will set out the government’s expectations for social media services, content hosts and other technology companies in enhancing online safety for Australian users. The charter is being revised following stakeholder feedback, and will be finalised in 2019.
Other identified gaps in the existing online safety framework are being addressed through funding for new programs to be administered by the Office of the eSafety Commissioner. These new online safety programs were announced in early2019, and include:
⺠an Early Years Online Safety Program to provide tailored training, support and resources for the early childhood sector
⺠an Online Safety Grants Program to support non-government organisations to deliver online safety and training projects, focusing on projects that address gaps in resources, or services for more vulnerable communities and regions
⺠programs to develop and roll out resources and training to frontline workers to enable them to tackle technology-facilitated abuse among Aboriginal and Torres Strait Islander women, and women with intellectual disabilities
The Online Safety Research Program was started in 2018-19 and will run until June2023 at a cost of $3.8million over fiveyears. This program will establish an annual national eSafety survey to track eSafety issues and trends over time.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 41
CASE STUDY
The Christchurch terror attacks
The terror attacks in Christchurch, New Zealand, on 15March2019 highlighted the ability of individuals to exploit digital platforms and content hosts to disseminate footage of their crimes. The attacks were livestreamed on Facebook, and later uploaded widely to other services, including YouTube.
The actions of digital platforms in the aftermath of the incident fell short of community expectations. In a joint initiative with industry, we co-chaired with the Department of the Prime Minister and Cabinet a new Taskforce to Combat Terrorist and Extreme Violent Material Online. Comprising government and industry representatives, the taskforce prepared advice to government on practical, tangible and effective measures to combat the upload and dissemination of terrorist and extreme violent material.
In June2019, the taskforce’s report to government provided a set of agreed actions and recommendations relating to prevention, transparency, deterrence, detection and removal, and capacity building. These agreed actions represent an important step forward in collaborations between industry and government on online safety matters. However, in the longer term, the government has signalled its willingness to consider further regulation where voluntary commitments do not meet community expectations. We will continue to monitor the implementation of the agreed actions to inform the need for our future regulatory action.
42 C O M M S & A R T S A n n u a l R e p o r t 2 0 1 8 - 1 9
Connectivity: sustainable economic growth
Results
Table 2.4 Results for measures related to sustainable economic growth
Measures 2018-19 targets Results Previous results
9 Percentage of ready-to-connect premises that have taken up NBN
â¥56% at 30June2019
Target met
56% in 2018-19
57% at 30June2018
10 Assessment of the effectiveness of the department’s international engagement on post and spectrum outcomes
Positive results achieved in 2018-19
Target met
Positive results achieved in 2018-19
Not previously measured
11 GDP contribution enabled by the communications sector
â¥$730.0billion in 2016-17a Target met $766.328billion
in 2016-17
$729.289billion in 2015-16a
12 Investment as a proportion of output in the communications sectorb
â¥33% in 2017-18c Target met 51% in 2017-18
48.2% in 2016-17
a For measure11, the years referred to in the revised 2018-19 Corporate Plan were 2017-18 for the target and 2016-17 for the previous result. These were incorrect (typos). Data to inform results against this measure are released by the Australian Bureau of Statistics two years in arrears.
b Output in the communications sector refers to the value added of the Information Media and Telecommunications industry division, as defined under the Australian and New Zealand Standard Industry Classification.
c For measure12, 2017-18 data was expected to be the most current available for 2018-19 reporting, which proved to be correct.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 43
Analysis
We support economic growth through:
⺠advising on the policy settings for take-up of the NBN ⺠engagement with international forums on post and spectrum outcomes ⺠promoting investment in the Australian communications sector
National Broadband Network (NBN) take-up
Through take-up, consumers are unlocking the economic benefits of the NBN. As part of promoting sustainable economic growth through the communications sector, we support the Minister in his role as a shareholder Minister oversighting NBNCo.
At 30June2019, we had met our target for NBN take-up, with more than 5.5million premises having taken up an NBN service, representing 56% of the 9.9million ready-to-connect premises (measure9). Of these, approximately 2.0million were connected outside major urban areas. With take-up on target, the network is already having a significant impact on the lives of Australians and the economy, helping drive the growth of new businesses, industry productivity, jobs, educational opportunities and access to healthcare options.
In commissioned research for NBNCo, AlphaBeta, a data analytics and economics firm, has estimated the impact of NBN take-up. In addition to take-up on the network contributing to up to $10.4billion a year to the national economy by 2021, access to the NBN is having a direct and more immediate impact on the quality of life for many Australians. For example, AlphaBeta estimated that access to the NBN is reducing social isolation, with regional Australians 40% more likely to use the internet to reduce social isolation compared to non-NBN-connected users. The network is also providing additional pathways for women to engage with the job market, with the number of self-employed women working part-time in NBN-connected regions growing at five times the pace of regions without the NBN.
International engagement on post and spectrum outcomes
In promoting international outcomes that support Australia’s economic growth, werepresent Australia at meetings of the:
⺠Universal Postal Union (UPU) ⺠International Telecommunication Union (ITU), including the ITU-Radiocommunication Sector (ITU-R)
The UPU sets rules for international mail and the ITU is responsible for international cooperation in the use of information and communications technologies. ITU-R’s mission is to ensure the rational, equitable and efficient use of the radio-frequency spectrum and satellite-orbit resources.
The work we do through these forums is important to Australia’s communications framework, including to Australian businesses staying competitive in a global market.
44 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
In assessing our effectiveness we considered our achievements in these forums. Weachieved positive results through international engagement in 2018-19 (measure 10).
Universal Postal Union (UPU) congresses
The Postal Union Congress, held every fouryears, is the main international meeting of the UPU. We also attend extraordinary congresses and in September 2018, we led the Australian delegation to the Extraordinary Congress of the UPU in Addis Ababa, Ethiopia. At the congress, we secured agreement to defer proposed additional costs on net importing countries, including Australia, until 2022.
In a strong show of support for our Pacific neighbours, we were instrumental in negotiating an agreement that will reduce the financial burden on small island developing states. The congress agreed to reduce the annual membership fees for small island developing states with populations under 200,000 by up to 90%.
Under the previous arrangements, some states’ membership fees exceeded their annual postal revenue, resulting in non-payment and loss of membership rights. The agreement relieves financial pressure on postal operators in Kiribati, Nauru, Samoa, Solomon Islands, Tonga and Tuvalu, as well as six Caribbean and two African island states. Senior officials from Nauru and Tonga travelled to the congress to present their case, and expressed their sincere appreciation for Australia and New Zealand’s combined efforts to ensure their voices were heard. This work underscores Australia’s leadership role locally and globally and helps Australia achieve outcomes in a multilateral context that directly benefit Australian consumers and business.
Telecommunication conferences
The ITU Plenipotentiary Conference, held every four years, is the ITU’s top policymaking meeting. It is the most important event for influencing decisions on the future role of the organisation and its ability to support the development of telecommunications worldwide.
In consultation with other government agencies and industry stakeholders, we led Australia’s preparation for, and participation in, the ITU Plenipotentiary Conference 2018 in Dubai, United Arab Emirates. The delegation, led by our Minister, successfully secured conference outcomes that aligned with Australia’s policy objectives and Australia was re-elected to the ITU Council for a further four-year term. We also secured support for proposals to strengthen administration and management, most notably to improve the consideration of a gender perspective throughout the ITU and to establish a review of the ITU regional presence.
We also attend the annual ITU Council meetings, as well as a range of ITU working groups, expert groups and advisory groups. Our attendance is effective in representing Australia’s strategic interests in the work of the ITU and in keeping the ITU working within its mandate.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 45
Radiocommunication conferences
The World Radiocommunication Conference (WRC), held every three to four years, isthe main international meeting of the ITU-R. The next WRC is scheduled to take place in Sharmel-Sheikh, Egypt, from 28October to 22November2019.
The 2017 Review of the ACMA recommended the head of delegation role for the WRC should be transferred from the ACMA to the department. We successfully implemented this recommendation in 2018-19, in collaboration with the ACMA. The ACMA will continue to support the delegation in a technical capacity. We led Australia’s delegation to the Asia-Pacific Telecommunity Preparatory Group’s fourth meeting of this WRC cycle in January2019, as well as to the second, and final, Conference Preparatory Meeting in Geneva, Switzerland, in February2019.
Investment and economic growth in the Australian communications sector
We advise government on policy settings that enable the communications sector to invest and innovate, to compete internationally and to meet consumer needs. Our work topromote sustainable economic growth through the communications sector includes:
⺠administering the carrier powers and immunities framework ⺠supporting industry deployment of 5G mobile services, the next generation of mobile wireless network technology
⺠working closely with .au Domain Administration (auDA) The communications sector makes up a relatively small proportion of the Australian workforce (105,800 people directly employed compared to 12.6million in the total economy in August 20181). It also makes up a small proportion of Australia’s GDP ($43.7billion in 2017-18, which is approximately 2.5% of overall GDP2). Nonetheless, ithas a broader impact on the general economy, compared to many other sectors.
For example, we estimate GDPcontribution critically enabled by the communications sector in 2016-17 at $766.328billion (measure 11). This figure is up $36billion compared to 2015-16. This estimate uses Australian Bureau of Statistics data on the GDP contribution from industries that use 5% or more of their total intermediate inputs from the communications sector.3 Figure 2.8 shows GDP critically enabled by communications services since 2008-09.
1 Australian Bureau of Statistics (June 2019) 6202.0 Labour Force, Australia May 2019.
2 Australian Bureau of Statistics (October 2018) 5204.0 Australian System of National Accounts, 2017-18, table2.
3 Australian Bureau of Statistics (June 2019) 5209.0.55.001 Australian National Accounts: Input-Output Tables, 2016-17, table2.
46 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Figure 2.8 GDP critically enabled by communications services
$ billion
100
200
300
400
500
600
700
800
2016-17 2015-16 2014-15 2013-14 2012-13 2011-12 2010-11 2009-10 2008-09
551.131 501.595
618.656 659.983
681.706 729.289
766.328
Note: Data not available for 2010-11 and 2011-12. Figure is in current price terms.
Source: Estimates based on Australian Bureau of Statistics (various dates) 5209.0.55.001 — Australian National Accounts: Input-Output Tables.
Investment in the sector is critical to unlocking economic growth as technologies continue to develop and improve over time. Measuring investment as a proportion of output in the communications sector provides insight into the level of investment in the sector. Investment includes funds for 5G infrastructure (for example, small cells), fixed-line broadband access networks, transmission networks, submarine cables, wireless facilities and data centres. Data for 2017-18 is the most current available. In 2017-18, investment as a proportion of output in the communications sector totalled 51% (measure 12).
We seek to promote growth and investment in the telecommunications sector through our policy and regulatory settings. Our aim is to provide certainty and minimise the regulatory burden on communications providers by imposing only those rules that are necessary to protect competition and consumer outcomes.
Carrier powers and immunities
The carrier powers and immunities framework we administer gives telecommunications companies some powers to enter land. This allows them to install and maintain some types of telecommunications facilities, and provides some immunities from state and territory legislation. These powers and immunities reduce the barriers faced by telecommunications companies and enable them to continue to support economic growth.
In 2018-19, we engaged carriers and large land and property owners to promote a shared understanding of the framework and ways to improve its operations. Improving understanding of the framework helps it to operate more efficiently.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 47
Preparing for 5G
Theimminent investment in and rollout of 5G represents a transformative step change from previous generations of mobile technology and takes us closer to global hyper connectivity than ever before.
5G is expected to support a wide range of immediate commercial and industrial applications across the economy — including in transportation, health, manufacturing and agriculture. Our April2018 paper, Impacts of 5G on Productivity and Economic Growth, found that multifactor productivity growth could add an additional $1300 to $2000 or more in GDP per person after the first decade of 5G rollout.
The Australian Government launched 5G — Enabling the future economy, its strategy to support the rollout and take-up of 5G, in October2017. The strategy included making spectrum available in a timely manner.
In 2018, we supported the Minister to make the decisions needed for the 3.6gigahertz auction by the ACMA, which is the spectrum band to be used for early adopters of 5G. The auction concluded in December2018 with spectrum successfully allocated to four bidders. We are also supporting the rollout of 5G through our leadership of the Australiandelegation to the WRC. High-level spectrum allocation decisions are made through this forum.
The 5G Working Group, which we lead, provides a forum for government and industry to discuss 5G issues. These include how various industry sectors might use 5G technology, as well as the regulatory and other settings required to enable its delivery and uptake. In 2018-19, the working group met twice, focusing on the potential role of 5G in healthcare and the future operation of the group, which had to be reviewed by 30June2019 under its terms of reference.
In April2019, industry members of the working group provided Australian Government officials with an update on 5G developments following the 2019 Barcelona World Mobile Conference and in anticipation of the commercial launch of 5G in Australia. Optus and Telstra have now launched commercial 5G services in limited footprints across Australia and Vodafone is expected to launch 5G in 2020.
The .au Domain Administration
The .au domain is an intrinsic part of the identity of many Australian businesses and organisations operating on the internet. The auDA is the independent, not-for-profit entity that oversees operation and management of the 3.0million .au domains. It is essential that Australia’s .au domain administrator is modern and fit-for-purpose, and supports the interests of Australia’s internet users.
The 2018 Review of the .au Domain Administration made several recommendations focused on better governance. Throughout 2018-19, we worked closely with the auDA to support it implementing the recommendations. This work continues to include reforms to the auDA Board and membership, and greater consultation with the wider internet community on policy positions.
48 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Connectivity: program resourcing (input), activity and efficiency
Results
Table 2.5 Results for measures related to program resourcing (input), activity and efficiency
Measures 2018-19 targets Results Previous results
13 Expenses for digital technologies and communications services (program 1.1)
2018-19 expenses are within 5% of published budget figures
Target met
$1.847 billion in 2018-19 (4% less than budgeted in the 2018-19 Portfolio Additional Estimates Statements)
$1.906billion in 2017-18 (0.65%less than budgeted)
14 Assessment of the effectiveness of the department’s oversight of communications portfolio entities
Effective in 2018-19
Target met
Our oversight was effective in 2018-19
Effective in 2017-18
15 Assessment of whether program 1.1 administered items are delivered efficiently
Administered items are delivered on time and on budget in 2018-19, indicating efficient delivery
Target not met
We delivered 14of 17 program1.1 administered items on time and on budget in 2018-19
Not previously reported
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 49
Analysis
This section provides an analysis of our program resourcing, output and efficiency:
⺠expenditure against our digital technologies and communications services budget program (program1.1)
⺠the effectiveness of our portfolio oversight activities ⺠our efficiency delivering program1.1 administered items
Program expenses
In 2018-19, expenses for digital technologies and communications services totalled $1.847 billion (measure 13), which was 4% less than budgeted in our 2018-19 Portfolio Additional Estimates Statements in February 2019, and 3% less than expended for program 1.1 in 2017-18.
Of program 1.1 expenditure, $1.328 billion was paid to the national broadcasters (ABC and SBS), which is 72% of the total program.
Oversight of communications portfolio entities
We engage with Australia Post, NBNCo, and the ACMA, to support their governance, sustainability and achievement, and work together to support participation and growth inarts and cultural activity, including ABC and SBS.
Our oversight activities focus on:
⺠entity corporate planning and annual reporting ⺠Budget and operational funding ⺠advising the Minister on governance arrangements, including Board appointments ⺠operational policy settings In 2018-19, we undertook all required activities, for effective oversight (measure 14).
Efficient program delivery
Our approach to program delivery focuses on the efficient management of public resources.
We delivered 14 of 17 program 1.1 administered items on time and on budget in 2018-19 (measure 15). Further information on each is included in Table2.6.
50 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table 2.6 Administration of program 1.1 administered items
Administered item Results: timeliness Results: budget
1 Community Broadcasting Program
We provided grant funding to the Community Broadcasting Foundation, which then distributes funds to community radio and television providers to support the development and broadcasting of content.
Target met
Community broadcasting sector continues to deliver vital services
Target met
$2.2 million provided
2 Consumer Representation Grants Program
We fund the Australian Communications Consumer Action Network (ACCAN) to represent the views of consumers on communications issues. ACCAN is also required to positively engage with the media and industry.
Target met
All quarterly reports provided on time and key performance indicators met
Target met
$2.2 million provided
3 Intellectual Property
We make an annual membership payment to the World Intellectual Property Organization (WIPO) and subscribe to the annual Intellectual Property Watch. The payment to WIPO by Australia is a requirement ofmembership.
Target met
The annual contribution to WIPO supports Australia’s engagement in international copyright policy
Target met
$300,000 provided
4 International Organisation Contributions
We make membership payments to the ITU and the Asia-Pacific Telecommunity (APT).
Target met
Australia pledged its ITU member contribution for 2018-19 through a four-year cycle of forward expenditure at the 2018 ITU Plenipotentiary Conference. The APT member contribution was agreed for the 2018 to 2020 cycle at the APT General Assembly in November 2017
Target met
$6.6million provided to the ITU, part of our $27.9million four-year cycle of forward contribution to the ITU
$256,000 provided as our annual APT member contribution
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 51
Administered item Results: timeliness Results: budget
5 Mobile Black Spot Program
We fund grants to mobile network operators and infrastructure providers to improve mobile coverage and competition across Australia.
Target not met
Delays have been experienced in delivering some base stations funded under the first three rounds by 30June2019. The delays were due to external factors such as the time required for land acquisition, local and state government approvals, and connection to power
Target not met
$23.4million provided
Due to delays in delivering some base stations funded under the first three rounds and making final payments, 2018-19 expenditure is less than budget by more than 5%
6 WiFi and Mobile Coverage on New South Wales Central Coast Trains
We deliver this program through a National Partnership Agreement with the NSW Government, and therefore funding is appropriated to Treasury under the Federal Financial Relations framework. It provides funds to the NSW Government to fulfil the election commitment to establish mobile and internet connectivity along the train route between Hornsby and Wyong.
Target not met
Delivery of this program is currently behind schedule because the key milestones (mobile base stations/ train station WiFi) are still to be delivered
Target not met
Delivery of this program is currently behind schedule; $8.0 million of 2018-19 budget expenditure was not incurred
7 NBN Co Loan
We manage the Commonwealth’s $19.5billion loan to NBN Co. NBN Co makes monthly drawdown requests.
The loan has a fixed interest rate of 3.96% per year and is supporting NBN Co in rolling out the NBN.
Target met
NBNCo made 12drawdowns against the loan
Target met
$7.522billion total drawdowns by NBN Co
52 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Administered item Results: timeliness Results: budget
8 Funding to the National Broadcasters: ABC and SBS
We make payments to fund the operations of the ABC and SBS to ensure that services continue in line with their charters.
Target met
The national broadcasters continue to provide television, radio and digital media services in line with their charters
Target met
$1.328 billion provided
9 Regional Backbone Blackspots Program
We provide funds to Nextgen Networks (now Vocus) to put in place key fibre backhaul infrastructure in regional Australia. Construction is now complete. Vocus continues to operate and maintain the backhaul infrastructure. The expense relates to depreciation (non-cash) and is in accordance with the estimated depreciation schedule.
Target met
Performance and reporting requirements were met
Target met
$8.0million provided
10 Regional Broadcasting
We provide funds for capital and operating costs associated with the delivery of commercial digital television services via the Viewer Access Satellite Television platform, which is a direct-to-home satellite service covering all of Australia. The funding is administered through two separate funding agreements with two joint venture companies established for this purpose.
Target met
Performance and reporting requirements were met
Target not met
$7.9million provided
Funding recipients are entitled to claim payments for actual expenses incurred in providing services. Payments were less than the allocated budget by more than 5%
11 Regional Journalism Scholarship Program
We provide payments to higher education providers, to support regional students to study journalism.
Target met
Universities granted 66 scholarships to journalism students from regional areas under round1 of the program
Target met
$2.3 million provided
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 53
Administered item Results: timeliness Results: budget
12 Regional and Small Publishers Cadetship Program
We provide payments to small and regional publishers to create additional employment opportunities for cadet journalists.
Target met
Regional and small publishers granted 45 cadetships under round1 of the program
Target met
$1.5 million provided
13 Spectrum Pricing — Transitional Support
This is a transitional support package we are providing over a five-year period, from 2017-18, to ensure individual broadcasters are no worse off as a consequence of the introduction of new spectrum pricing fees and the abolishment of the broadcasting licence fees, datacasting charges and apparatus licence fees.
Target met
We processed 2018-19 payments in July2018
Target met
$4.9million provided
14 Supporting Under-represented Sports
We provide funding to Fox Sports to increase coverage of sports that receive low or no broadcast exposure (for example, women’s sports, niche sports, and those sports that command high levels of community involvement and participation).
Target met
Fox Sports continued to broadcast coverage of women’s, niche and emerging sports in line with its grant agreement
Target met
$7.5 million provided
54 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Administered item Results: timeliness Results: budget
15 Public Interest Telecommunications Services Special Account: National Relay Service (NRS)
Through this part of the special account, we fund Australian Communication Exchange Ltd (ACE) and WestWoodSpice to deliver the NRS, an Australia-wide phone service for people who are deaf or have a hearing or speech impairment.
The awarding of the new NRS contract to Concentrix Services Pty Ltd, following a competitive process, will result in cost savings. Our phased reduction in contracted NRS outreach tasks, as we increasingly took on NRS information and advice activitiesourselves, has also resulting in cost savings.
Target met
The initial Portfolio Budget Statements (PBS) figure was predicated on the awarding of a new NRS contract. Extension of the tender process into 2018-19 resulted in the continuation of the contractor payment arrangement
Target met
$27.0million provided
16 Public Interest Telecommunications Services Special Account: Universal Service Obligation
Through this part of the special account, we fund Telstra to ensure that standard telephone services, payphones and prescribed carriage services are reasonably accessible to all people in Australia on an equitable basis, wherever they reside or carry on business.
Target met
Performance and reporting requirements linked to payments were met by Telstra
Target met
$270.0 million provided
17 Public Interest Telecommunications Services Special Account: Other Public Interest Services
Through this part of the special account, we fund Telstra to deliver other public interest services that support the continuity of supply of carriage services during the transition to the NBN.
Target met
Performance and reporting requirements linked to payments were met by Telstra
Target met
$47.5 million provided
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 55
Creativity and culture: inclusiveness
Results
Table 2.7 Results for measures related to creativity and culture — inclusiveness
Measures 2018-19 targets Results Previous results
16 Engagement with the national cultural institutions, indicated through:
(a) number of in-person visits to engage with national collecting institutions (including on- and off-site visitsa)
(b) percentage of objects in national collections accessible online
(c) number of website visits to the national cultural institutions
To maintain or increase 2018-19 results compared to annual averages since 2012-13:b
(a) â¥9.6 million
(b) â¥6.39%
(c) â¥42.7 million
Target met
Based on data available to the department at 10 September 2019, in 2018-19:
(a) 10.4 million
(b) 8.7%
(c) 49.5 million
In 2017-18:
(a) 9.9million
(b) 8.31%
(c) 46.6million
17 Assessment of the impact of our programs to support inclusion of:
(a) regional, rural and remote Australians
(b) people with disability
Positive results achieved in 2018-19
Target met
We achieved positive resultsin 2018-19
Not previously measured
a Off-site visits include visits to travelling and outreach programs/supported events/exhibitions (including viewing artworks and cultural objects loaned from collecting institutions).
b The indicators for engagement with the national cultural institutions were established in 2012-13.
56 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Analysis
To analyse the effectiveness of our activities in increasing Australians’ participation in diverse creative and cultural experiences, we have considered:
⺠engagement with the national cultural institutions ⺠our programs to encourage participation in small communities and regional areas
Engagement with the national cultural institutions
The national cultural institutions directly promote participation in Australia’s rich creative and cultural heritage, and develop our diverse creative practitioners. We engage closely with these institutions and advise government on governance, policy and funding matters:
⺠Australia Council ⺠Australian Film, Television and Radio School (AFTRS) ⺠Creative Partnerships Australia ⺠Screen Australia
⺠the national collecting institutions: - Australian National Maritime Museum (ANMM)
- Bundanon Trust
- Museum of Australian Democracy at Old Parliament House (MoAD)
- National Film and Sound Archive of Australia (NFSA)
- National Gallery of Australia (NGA)
- National Library of Australia (NLA)
- National Museum of Australia (NMA)
- National Portrait Gallery of Australia (NPGA)
To inform our policy advice and to support institutions in tracking their activity, we provide a framework for regular reporting against key measures. The reporting provides insight into audience attendance and experience, access to our national collections, digitisation, education programs, funded activities and collaborations.
Since reporting started in 2012-13, trends show that in-person visitor numbers to the national collecting institutions remain high, even in an increasingly digital environment. Visitor numbers totalled 10.4million during 2018-19 (measure 16a), meeting targets set for the year (see Figure2.9).
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 57
Figure 2.9 In-person visits to national collecting institutions
5,911,194
4,503,511
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
Total on- and off-site visits Off-site visits On-site visits
2018-19 2017-18 2016-17 2015-16 2014-15 2013-14 2012-13
10,414,705
Note: Off-site visits include visits to travelling and outreach programs/supported events/exhibitions (including viewing artworks and cultural objects loaned from collecting institutions).
National cultural institutions are progressively using more digital technologies. This is reflected in the growing percentage of objects in national collections available online, presented in Figure 2.10. Improved digital access is an important aspect to inclusiveness and is supporting greater audience participation (see Figure 2.11). The percentage of objects held by national collections accessible online had grown to 8.7% and website visits to the national cultural institutions totalled 49.5million in 2018-19 (measures 16b and 16c), exceeding targets set for the year.
58 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Figure 2.10 Objects in national collections accessible online, held by national collecting institutions
2012-13
2016-17 2017-18 2018-19
Objects in collection not available online
Objects available online
Circle size is proportionate to collection size
2014-15 2013-14 2015-16
4.76% 5.20% 6.14%
7.65% 8.31%
8.68%
6.27%
Figure 2.11 Website visits to the national cultural institutions
37.4 million
38 million
40.5 million
46.6 million
30
40
50
2018-19 2017-18 2016-17 2015-16 2014-15
49.5 million
million
Note: Data from 2012-13 and 2013-14 was collected but has been omitted from this graph. A change in analytics methodology between 2013-14 and 2014-15 means that earlier years are not comparable to the data shown.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 59
Departmental programs to support inclusion in the creative and cultural sectors
To analyse the effectiveness of our creative and cultural programs in supporting inclusion of Australians in regional, rural and remote communities, we considered:
⺠the rollout of our regional grant programs ⺠the Protection of Cultural Objects on Loan Scheme In assessing the effectiveness of our work for people with disability, we considered the advancement against the 2009National Arts and Disability Strategy.
Our assessment showed positive results were achievedin2018-19 (measure 17).
Administered items — regional grant programs
To encourage participation in creative and cultural experiences in regional, rural and remote communities, we provide funding through the following:
⺠Regional Arts Fund ⺠Festivals Australia ⺠National Collecting Institutions Touring and Outreach Program ⺠Visions of Australia regional exhibition touring program Further information on the objectives and operations of these programs in 2018-19 is provided in Table2.12, which starts on page 79.
Protection of Cultural Objects on Loan Scheme
The Protection of Cultural Objects on Loan Scheme provides certain legal protections for cultural objects lent by overseas lenders for temporary public exhibition in Australia. Itlimits the circumstances under which lenders, exhibiting institutions, exhibition facilitators and people working for them can lose ownership, physical possession, custody or control of objects while on loan to an approved Australian institution. The scheme is intended to encourage the lending of significant cultural objects from overseas for display in Australia.
Twelve cultural institutions located in six states and territories are approved to participate under the scheme. These institutions hold exhibitions accessed by Australians from both metropolitan and regional areas. In 2017-18, the scheme supported 11 institutions to display 26 exhibitions to a combined audience of more than 3.5 million visitors. Figures for 2018-19 were not available at the time of preparing this annual report.
National Arts and Disability Strategy
The National Arts and Disability Strategy, an initiative of the Australian Government and state and territory governments through the Meeting of Cultural Ministers, is focused on improving access to and participation in the arts by people with disability. Under the strategy, we are funding:
⺠the online portal of accessible arts and cultural activity, ARTfinder National, for launch in 2019-20
⺠delivery and evaluation of the Art+You pilot program in South Australia. Art+You assists artists to articulate their art goals in their National Disability Insurance Scheme plans
60 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
CASE STUDY
National Arts and Disability Strategy consultation
In 2018, the Australian Government and state and territory governments consulted people with disability, carers and organisations about the future for the National Arts and Disability Strategy. The consultation reached nearly 400people online, and300people face-to-face in eight capital cities and seven regional towns.
We released a report on the consultation in February 2019. One finding was that the major barrier to access and inclusion in the creative and cultural sector is negative attitudes towards disability. Opportunities for people with disability to participate in cultural life — as creators, decision-makers, audiences and customers — are improved when the community has positive attitudes towards people with disability and an understanding of accessibility.
The collaborative nature of creative and cultural activities can create positive outcomes for artists, arts workers and audiences with disability. However, people with disability experience barriers to accessing arts education and training, and career development. They are also sometimes excluded from opportunities to lead.
The stories and ideas that people shared will help to shape a renewed National Arts and Disability Strategy.
PA R T 1 O v e r v i e w 61
Creativity and culture: growth
Results
Table 2.8 Results for measures related to creativity and culture — growth
Measures 2018-19 targets Results Previous results
18 GDP contribution by the creative and cultural sectors, including:
(a) overall contribution
(b) contribution of broadcasting, electronic or digital media and film
(c) contribution of music composition and publishing
In 2017-18:a
(a)â¥$111.713billion
(b) â¥$9.707billion
(c)â¥$148.0million
Result not available
GDP contribution results for 2017-18 are not yet available
In 2016-17:
(a)$111.713billion
(b) $9.707billion
(c) $148.0million
19 Philanthropic funding to the creative and cultural sectors, including:
(a) estimated private sector support to the arts
(b) to organisations listed on the Register of Cultural Organisations
In 2017-18:a
(a) â¥$300.0million
(b) â¥$100.0million
Target met
In 2017-18:
(a) $319.1million
(b) $135.9million
In 2016-17: (a) approximately $300.0million
(b) $116.6million
a In setting the 2018-19 target for measures 18 and 19, 2017-18 results were expected to be the most current available for 2018-19 reporting, which proved to be correct in the case of measure 19, but not measure 18.
62 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Analysis
To analyse the effectiveness of our activities to promote growth in creative and cultural activity, we have considered:
⺠the economic value of creative and cultural activity ⺠philanthropic funding to the creative and cultural sectors
The economic value of creative and cultural activity
Creative skills will be key to Australia’s future growth. In January2019, our Bureau of Communications and Arts Research released a working paper, Creative Skills for the Future Economy. The paper examined the role of creativity in economic growth. It found that over 9% of all people employed in Australia at the most recent census in 2016 held a creative qualification as their highest level of qualification. Creative skills have been integral to fast-growing industries over the past decade.
Our Bureau of Communications and the Arts publication Cultural and Creative Activity in Australia 2008-09 to 2016-17, released in October2018, presents analysis on results to 2016-17. The publication shows creative and cultural activity contributed approximately $111.7billion to the Australian economy in 2016-17, equating to around 6.4%of GDP (measure 18). Figure2.12 shows the trend.
Figure 2.12 Creative and cultural activity: GDP national account basis
$ billion
20
40
60
80
100
120
2016-17
2015-16
2014-15
2013-14
2012-13
2011-12
2010-11
2009-10
2008-09
85.956
91.074
96.024 101.903 100.867 101.816
106.079 106.014 111.713
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 63
We monitor annual growth in creative and cultural activity based on data from the Australian BureauofStatistics. Our analysis measures the economic activity driven by creative and cultural industries as well as the wages received from creative and culturaloccupations.
We rely on externally collected data in order to establish these figures. Data was not available within the reporting period to allow us to calculate the contribution of creative and cultural activity in 2017-18. This is a long-term measure and as such trend results provide sufficient information for appropriate performance information, to inform a judgement on long-term performance against our purpose.
Our programs and policies support Australia’s creative industries in producing original, compelling and accessible content, and enable creatives to generate income, retain intellectual property and contribute to the economy. These are:
⺠our administered items ⺠Location Offset, and Post, Digital and Visual (PDV) Effects Offset ⺠Foreign Actor Certification Scheme ⺠Resale Royalty Scheme
⺠Artbank ⺠Australian Music Industry Package
Administered items
We deliver the Prime Minister’s Literary Awards and the Public and Educational Lending Right schemes to support the growth and development of Australian writing. Further information on the objectives and operations of these administered items in 2018-19 is included in Table2.12, which starts on page 79.
Location Offset, and Post, Digital and Visual (PDV) Effects Offset
To encourage large-budget film and television projects to film in Australia, the government’s Location Offset provides a 16.5% tax rebate on productions that spend at least $15.0million on qualifying Australian production expenditure. To support the work of Australia’s post-production, digital and visual effects sector, the PDV Effects Offset provides a 30% tax rebate on productions that spend at least $500,000 on qualifying Australian PDV expenditure, regardless of where a production is filmed.
In 2018-19, the Minister issued 93final certificates to applicants for the Location Offset and PDV Offset. The qualifying Australian production expenditure of these productions totalled $801.4million, with an estimated rebate payable to these productions of $176.0million. The Film Certification Advisory Board issued a further 32provisional certificates for the offsets.
64 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Foreign Actor Certification Scheme
The Foreign Actor Certification Scheme assesses applications for foreign performers to enter Australia to work on film and television productions. The scheme ensures Australian industry personnel are given a fair opportunity to secure employment in film and television productions shot in Australia, and that Australian voices continue to be heard in Australian productions. In 2018-19, we certified 126 foreign actors under the scheme.
Resale Royalty Scheme
Under the Resale Royalty Scheme, visual artists are entitled to a royalty payment of 5% of the resale price for eligible works of art resold commercially for $1000 or more. As at 30 June 2019, the scheme had generated $7.2 million in royalties for 1821 artists from 19,120 resales since its establishment in 2010.
Artbank
Artbank is a program within the department with core objectives to provide direct support to Australian contemporary artists through the acquisition of their work, and to promote the value of Australian art to the broader public. It increases the sustainability and accessibility of the Australian visual arts industry, supports practising artists, andencourages engagement with, and appreciation of, Australian contemporary art. In2018-19, Artbank purchased 72 new works. Artbank funds its operations through theleasing of artworks from its collection. Through 2018-19, 5793 works were leased toclients.
Australian Music Industry Package
In 2018-19, the Australian Government announced a $30.9million package of measures over five years from 2019-20 to support and develop the Australian contemporary music industry. This includes the Live Music Australia initiative providing funding of $20.0million over four years from 2020-21 to enable Australian businesses to host domestic live music events featuring Australian artists including in regional and remote Australia.
Philanthropic funding to the creative and cultural sectors
Philanthropy and corporate sponsorship play an essential role in the sustainability and growth of Australia’s creative and cultural sectors. Fostering this culture of support is important and includes giving, investment, partnership and volunteering as well as bringing donors, businesses, artists and arts organisations together. We oversee Creative Partnerships Australia, which is the Australian Government’s primary body for encouraging and facilitating greater private sector support for the arts.
We estimate annual private sector support to the arts based on data from the Australian Bureau of Statistics. The most recent results from 2017-18 estimate private sector support to the arts at $319.1 million (measure 19a). This is up $19.1 million compared to 2016-17. Results since 2001-02 are presented in Figure 2.13.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 65
Figure 2.13 Private sector support for the arts in Australia (estimate)
100
150
200
250
300
350
2017-18
2016-17
2015-16
2014-15
2013-14
2012-13
2011-12
2010-11
2009-10
2008-09
2007-08
2006-07
2005-06
2004-05
2003-04
2002-03
2001-02
$ million
319.145
We maintain the Register of Cultural Organisations, a list of cultural organisations that can receive tax deductible gifts. The register aims to strengthen private sector support for the arts and encourages Australians to contribute to the nation’s vibrant cultural life. In 2017-18, donations to organisations listed on the Register of Cultural Organisations totalled over $135.9million, up $25.3million compared to results calculated the previous year (measure19b).
66 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Creativity and culture: protecting and promoting Australian culture
Results
Table 2.9 Results for measures related to creativity and culture — protecting and promoting Australian culture
Measures 2018-19 targets Results Previous results
20 Number of students successfully completing courses at national elite performing arts training organisations
>800 in 2018 Target met
1056 in 2018
1198 in 2017
21 Assessment of the impact of our programs on supporting, preserving and celebrating:
(a) Indigenous languages and arts
(b) Australian creativity and culture internationally
Positive results achieved in 2018-19
Target met
We achieved positive resultsin 2018-19
Not previously measured
Analysis
We work to protect and promote arts and culture, by providing support for:
⺠national elite performing arts training organisations ⺠Indigenous languages and arts ⺠international engagement The work of the department and our portfolio entities to protect, preserve and promote Australian culture also contributes to Australia’s efforts to achieve the United Nations Sustainable Development Goals. This work contributes directly to Goal 11 — Sustainable Cities and Communities: Make cities and human settlements inclusive, safe, resilient andsustainable.
On a national level, we ensure that Australia’s cultural heritage is diverse and accessible.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 67
Support to national elite performing arts training organisations
With our support, the national elite performing arts training organisations provide Australia’s most talented performing artists with the opportunity to excel in their chosen fields. The seven national elite performing arts training organisations are:
⺠Australian Ballet School ⺠Australian National Academy of Music ⺠Australian Youth Orchestra ⺠Flying Fruit Fly Circus
⺠National Aboriginal and Islander Skills Development Association Dance College ⺠National Institute of Circus Arts ⺠National Institute of Dramatic Art Across these organisations, 1056 students successfully completed courses in 2018, meeting our target (measure 20). A total of 3702 people auditioned for 833 new core course places offered in 2019, demonstrating significant continued demand for elite performing arts training (22.5% success rate).
The arts training organisations continue to effectively leverage their Australian Government funding. Data compiled at the most recent reporting period (1October2018 to 28February2019) shows 57% of their combined income is obtained from sources such as other grants, philanthropic fundraising and fees for service (see Figure 2.14).
Figure 2.14 Combined arts training organisations income, 1October2018 to 28February2019
Departmental grant $9.9 million
Other grants $1.8 million
Philanthrophic funding $3.2 million
Fee for service $8.1 million
Further information on the objectives and operations of the national elite performing arts training organisations administered item in 2018-19 is included in Table 2.12, which starts on page 79.
68 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Indigenous languages and arts
We contribute to preserving, protecting and celebrating Australia’s art and culture, including Aboriginal and Torres Strait Islander voices and languages, for generations to come. Our programs and policies to support, preserve and celebrate Indigenous arts and languages include:
⺠International Year of Indigenous Languages (IY2019) ⺠our administered items ⺠Indigenous Grants Policy ⺠digital labelling trial for Indigenous products Our Indigenous languages and arts programs achieved positive resultsin2018-19 (measure21a).
International Year of Indigenous Languages (IY2019)
The United Nations General Assembly declared 2019 the International Year of Indigenous Languages. We have developed an Australian Government Action Plan for the 2019 International Year of Indigenous Languages. A key aim is to raise awareness of the critical state of Australia’s first languages and to contribute to their preservation. Australia is also participating in the United Nations Educational, Scientific and Cultural Organization (UNESCO) steering committee.
A key component of our IY2019 action plan is partnering with the Australian Institute of Aboriginal and Torres Strait Islander Studies and the Australian National University to develop a National Indigenous Languages Report. Scheduled for release in late 2019, thereport will provide information on the state of Australia’s Indigenous languages and data on how they are critical to daily lives.
Administered items
In order to support Indigenous cultural expressions, we deliver the Indigenous Languages and Arts program and the Indigenous Visual Arts Industry Support program. Further information on the objectives and operations of these administered items in 2018-19 is included in Table2.12, which starts on page 79.
Indigenous Grants Policy
To improve on-the-ground service delivery, and stimulate greater economic development, we are participating in the trial of the Indigenous Grants Policy. The then Prime Minister and the then Minister for Indigenous Affairs announced the trial on 12February2018. The trial is testing how best to increase the involvement of Aboriginal and Torres Strait Islander peoples in funded programs. Our Indigenous Languages and Arts and Indigenous Visual Arts Industry Support programs are participating in the trial.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 69
Digitising endangered Pilbara languages
In a remote town, more than 1000km north-east of Perth, SouthHedland’s Wangka Maya Pilbara Aboriginal Language Centre project is preserving some of the world’s oldest languages. With funding support from our Indigenous Languages and Arts program, the language centre is making Indigenous languages available on educational apps for smartphones.
This project is establishing Wangka Maya as a hub of digital innovation, with mobile apps that capture and preserve Pilbara language and culture in exciting new formats. A series of up to 10mobile apps are being released, teaching words and phrases of critically endangered Pilbara languages including Banyjima, Karriyarra, Ngarla, Nyangumarta, Nyamal and Putijarra. The apps will contain multilingual narration, imagery, animation, music and video technology to support learning and engagement in an innovative and culturally sensitive manner.
CASE STUDY
Digital labelling trial for Indigenous products
The government has provided $150,000 to Desart to trial the use of QR Code labelling that will improve information to consumers on authentic Aboriginal and Torres Strait Islander products. The digital labelling will help consumers make informed, ethical purchases and increase economic and cultural opportunities for Aboriginal and Torres Strait Islander artists and designers.
The trial will commence in 2019-20 with three art centres, Tangentyere in the Northern Territory, Martumili in Western Australia and Girringun in Queensland.
Australian creativity and culture internationally
We work with international and domestic partners, both within the arts sector and across governments, to support and celebrate Australian creativity and culture internationally.
To assess the effectiveness of our activities, we considered the:
⺠investments we make in cultural diplomacy ⺠work we do to protect movable heritage objects that are culturally significant ⺠support we give to the Australian screen industry, which is described on pages 63 to 64 ⺠introduction of a new program to amplify Australia’s voice in the Pacific Our programs to celebrate Australian creativity and culture internationally achieved positive resultsin2018-19 (measure21b).
70 C O M M S & A R T S A n n u a l R e p o r t 2 0 1 8 - 1 9
International Cultural Diplomacy Arts Fund
Through the International Cultural Diplomacy Arts Fund, we invest in activities that advance Australia’s cultural interests and reputation abroad and strengthen Australia’s international people-to-people relationships. Further information is included in Table 2.12, which starts on page 79.
We also continued to provide secretariat support for the operation of the Australia-Singapore Arts Group. The group aims to enhance cultural relations between the two countries by promoting sustainable artistic and cultural activities.
Protection of Movable Cultural HeritageAct 1986
The Protection of Movable Cultural Heritage Act 1986 protects Australia’s movable cultural heritage. It regulates its export and provides for the return of illegally exported foreign cultural property to Australia. The Act gives effect to Australia’s obligations under the UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property 1970. During 2018-19, we issued 36 permits for the permanent export of movable cultural heritage under the Act and eight temporary permits.
Amplifying Australia’s Voice in the Pacific
In November 2018, the Australian Government announced the Amplifying Australia’s Voice in the Pacific program as part of a suite of measures aimed to strengthen Australia’s engagement with the Pacific region. We will administer $17.0 million over three years from 2019-20 to Free TV Australia, to deliver 1000 hours per year of Australian television content to broadcasters in the Pacific.
Preserving and promoting Australian cultural heritage
We work to preserve and promote Australia’s cultural heritage through:
⺠our administered items ⺠our Indigenous repatriation work ⺠the allocation of additional funding to Bundanon Trust
Administered items
To protect and promote Australian cultural heritage we deliver the following administereditems:
⺠National Cultural Heritage Account ⺠Marking 250 years since James Cook’s first voyage to Australia in 1770 ⺠ANMM—Maritime Museums of Australia Project Support Scheme ⺠NLA —Community Heritage Grants
⺠Museums and Galleries Australia bursaries Further information on the objectives and operations of these administered items in 2018-19 is included in Table2.12, which starts on page 79.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 71
Indigenous repatriation
Returning ancestral remains and secret sacred objects back to Country helps to promote healing, justice and reconciliation for Aboriginal and Torres Strait Islander peoples. Through the Indigenous Repatriation Museum Grants Program, we make funding available to eight major museums. For more information refer to Table2.12, which starts on page 79.
We are also responsible for advocacy and facilitating the return of Aboriginal and Torres Strait Islander ancestral remains from overseas collecting institutions and private holders. In 2018-19, we facilitated sixoverseas repatriation handover ceremonies from eight collecting institutions — two ceremonies in Sweden, one in the United Kingdom and three in Germany. As a result of these repatriation ceremonies, the remains of 98Aboriginal ancestors were returned to Australia. We worked with representatives from 20communities and representative bodies to facilitate these returns.
This demonstrates the Australian Government’s ongoing commitment to upholding the United Nations Declaration on the Rights of Indigenous Peoples, by working with overseas collecting institutions and governments to support change in collecting ethics and advocate for the return of ancestors.
Bundanon Trust Masterplan
The Australian Government announced funding of $22.0million over three years from 2019-20 to implement Bundanon Trust’s Masterplan development. The development will expand the Riversdale property to protect and display the Trust’s significant art collection, provide essential visitor and staff services, repurpose heritage buildings for public use and provide additional on-site accommodation. The masterplan will increase visitation and provide greater access to and engagement with the collection.
72 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Creativity and culture: protecting and promoting Australian content
Results
Table 2.10 Results for measures related to creativity and culture — protecting and promoting Australian content
Measures 2018-19 targets Results Previous results
22 Assessment of the effectiveness of the content regulatory framework for classification, Australian content and copyright
Positive results achieved in 2018-19
Target met
We achieved positive results in2018-19
Not previously measured
23 Assessment of whether the media regulatory framework is fit-for-purpose
Neutral or positive results achieved in 2018-19
Target met
We achieved positive results in2018-19
Not previously measured
Analysis
To analyse the effectiveness of our activities to protect and promote Australian content we considered our regulatory frameworks for:
⺠classification, content and copyright ⺠media
Australia’s content regulatory framework — classification, Australian content and copyright
The regulatory framework to protect Australian content includes classification, quotas and expenditure obligations for broadcasters, and copyright.
In assessing the effectiveness of the content regulatory framework, we found positive results were achieved in 2018-19 (measure 22).
Classification
To help inform consumer choices about entertainment content, and support parents to protect children from inappropriate content, we maintain regulations that generally require films and computer games to be classified before they can be legally made available to the Australian public.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 73
Throughout 2018-19, we continued to provide support to the Classification Board and Classification Review Board, to enable them to make classification decisions.
In October2018, the Minister approved the Netflix Classification Tool for ongoing use, following a pilot in 2017. We have subsequently established an ongoing monitoring program of tool decisions through a memorandum of understanding with Netflix.
The ClassificationBoard made 2833 classification decisions during the reporting period, all within statutory time limits, compared to 3156 decisions in 2017-18. There were 163complaints about Classification Board decisions, compared with 249 in 2017-18. The Classification Review Board reviewed, upon application, four decisions of the ClassificationBoard.
The Netflix Classification Tool determined 1923 decisions, and the International Age Rating Coalition (IARC) Tool determined 317,550. There were three complaints about decisions made by the IARC Tool and six complaints about decisions made by the NetflixClassification Tool.
Australian content (including quotas and expenditure obligations for broadcasters)
An objective of the Broadcasting Services Act 1992 is to promote the role of broadcasting services in developing and reflecting a sense of Australian identity, character and cultural diversity. This objective is met through our policy work on Australian content quotas and expenditure obligations.
Over 2018-19, we have continued to monitor complaints and investigations into content and expenditure obligations as well as the evolving marketplace for delivering broadcast and other video content to Australian consumers.
All commercial television licensees met their transmission quotas and sub-quota requirements in 2018.The program expenditure reported by metropolitan and regional television licensees to the ACMA for 2017-18 shows licensees spent $1.6billion on Australian programs, an increase of 1% ($18.0million) on 2016-17.
During the reporting period, independent monitoring and industry reporting demonstrated commercial radio stations’ compliance with the quota obligations.
Copyright
Copyright encourages industries and creators to make and disseminate new creative works, while also allowing appropriate access to, and use of, these works in the publicinterest.
High levels of copyright infringement can have a negative impact on the creative industry through lost earnings. Our annual consumer survey on online copyright infringement enables us to monitor levels of copyright infringement. The 2019 survey showed:
⺠lawful consumption of digital content has continued to rise ⺠consumers are generally paying more for digital purchases and subscriptions than they were in 2018
74 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
⺠efforts to remove access to infringing websites remain an effective way to influence individual behaviour, with 37% of respondents indicating they would seek lawful access to material if they encountered a blocked site. This is illustrated in Figure 2.15
Figure 2.15 Volume of lawful and unlawful digital files consumed from January to March 2019 compared to the same period in 2018
Lawful Unlawful
2018 2019 2018 2019
1.423 million 1.7 million 292 million 299 million
33 million
Songs
Games
Movies
Shows
Songs
Games
Movies
Shows
47 million 11 million 13 million
86 million 143 million 83 million 38 million
258 million 289 million 122 million 35 million
Note: The infringement survey was conducted in March2019. While the volume of unlawful video games consumed has also risen significantly, this may be due to specifically asking consumers in 2019 to include games played on their mobile phone or tablet, and possible consumer uncertainty as to their lawfulness.
During 2018-19, we progressed copyright reform initiatives to:
⺠provide copyright industries with a more effective and efficient way to address online infringement on foreign websites through amendments to the Copyright Act 1968
⺠protect internet service providers and cultural, educational and disability organisations who work to ensure online infringement does not occur on their systems (safe harbour scheme) through updated procedures in the Copyright Regulations 2017
⺠fulfil the government’s commitment to protect international sound recordings through amendments to the Copyright (International Protection) Regulations 1969
In April2019, following extensive consultation, the department’s Bureau of Communications and Arts Research released the final report of its Review of Code of Conduct for Australian Copyright Collecting Societies. The review examined the extent to which the code remains the best mechanism to promote efficient, effective and transparent administration of copyright licences. We have worked closely with collecting societies to assist them to implement recommendations.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 75
We continue to monitor the amount paid to content creators by major collecting societies as a way of assessing the ongoing effectiveness of the copyright system in rewarding creators. In 2017-18, the amount the two declared collecting societies have paid to their members has remained steady:
⺠the Copyright Agency reported it paid a total of $123.9million to members, of which 84% was distributed to Australian rights holders
⺠Screenrights reported it paid a total of $42.8million to members, of which 59% was distributed to Australian rights holders
Australia’s media regulatory framework
Our work to facilitate a fit-for-purpose media regulatory framework includes making sure there is an appropriate balance between the need to support industry sustainability and the need to provide appropriate protections for the Australian community.
To assess whether our activities are promoting a fit-for-purpose media framework, weconsidered:
⺠the progress of media reforms ⺠audiences, broadcasting complaints and investigations ⺠audience metrics from the national broadcasters (the ABC and SBS) In assessing the media regulatory framework, we found positive results were achieved in 2018-19 (measure 23). This is based on data that shows large media audiences continue (including for the national broadcasters), and broadcasting complaints are low in number.
Progress of media reforms
In 2018-19, we continued to work with our industry partners, including regional broadcasters, to determine whether our regulatory frameworks remain fit-for-purpose. We will progress this body of work in 2019-20.
We administer the Regional and Small Publishers Cadetship Program, the Regional Journalism Scholarship Program and the Supporting Under-represented Sports program, which formed part of the 2017 Broadcasting and Content Reform Package. For information on the delivery of these programs, refer to Table 2.6 on page50.
As part of the media reforms, the government committed to set up an Inquiry into the Competitive Neutrality of the National Broadcasters. In September 2018, the panel delivered its report to government. The government released the report on 12December2018 and further action now sits with the national broadcasters. Wealso assisted in an Efficiency Review of the National Broadcasters, which was led by MrPeterTonagh and MrRichardBean (with support from KordaMentha). Their report was provided to the Minister inDecember 2018, and then to the national broadcasters in February2019.
76 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Audiences, broadcasting complaints and investigations
In 2018-19, we continued to monitor broadcasting complaints and investigations to assess whether Australian television content and classification regulatory and policy frameworks remain fit-for-purpose and support the creation and distribution of Australiancontent.
The ACMA is responsible for receiving broadcasting complaints and undertaking investigations into broadcasters’ compliance with codes of practice, licence conditions and standards related to the BroadcastingServices Act 1992. In its 2017-18 Annual Report, the ACMA reported the following:
⺠there were no complaints or investigations involving compliance with the regional commercial television local content licence condition to broadcast minimum amounts of material of local significance
⺠there were no complaints or investigations involving compliance with the regional commercial radio local content licence condition to broadcast prescribed amounts of material of local significance between 5am and 8pm on business days
⺠all metropolitan commercial television broadcasting licensees reported meeting primary channel (55%) and non-primary channel (1460 hours) transmission quotas for Australian content in 2017
⺠due to changes in primary affiliation arrangements with metropolitan licensees that took effect from 1 July 2016, 12 regional licensees failed to broadcast the required number of hours of Australian content on their non-primary channels
We continue to monitor media audiences. ACMA’s 2017-18 Communications Report, published in January2019, found:
⺠free-to-air television continues to hold the largest share of viewing hours, although this is in decline
⺠a majority of Australians watch some form of video content online ⺠Netflix remains the most popular subscription video on demand service, with 3.9million Australian subscribers
The national broadcasters
Approximately 83% of Australians believe the ABC performs a valuable role in the Australian community. The ABC’s 2017-18 Annual Report revealed no change in community sentiment compared to 2016-17. In 2018, combined national audience reach across television, radio and online was estimated at 70.2% over the period of one week. This represents an increase of 0.7% compared to the ABC’s estimated net reach in 2017(69.5%).
In its 2017-18 Annual Report SBS reported it had maintained overall audience reach across its channels and platforms, reaching approximately 13.0million Australians each month on TV and 3.1million on digital platforms.
These metrics demonstrate the importance of the national broadcasters to the Australian community. They reflect the important role the ABC and SBS play in shaping Australia’s sense of identity and informing, entertaining and reflecting the cultural diversity of Australian communities.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 77
Creativity and culture: program resourcing (input), activity and efficiency
Results
Table 2.11 Results for measures related to program resourcing (input), activity and efficiency
Measures 2018-19 targets Results Previous results
24 Expenses for arts and cultural development (program2.1)
2018-19 expenses are within 5% of published budget figures
Target met
$712.2 million in 2018-19 (2% more than budgeted in the 2018-19 Portfolio Additional Estimates Statements)
$676.7million in 2017-18 (0.5%less than budgeted)
25 Assessment of the effectiveness of the department’s oversight of arts and cultural portfolio entities
Effective in 2018-19
Target met
Our oversight was effective in2018-19
Effective in 2017-18
26 Assessment of whether program2.1 administered items are delivered efficiently
Administered items are delivered on time and on budget in 2018-19, indicating efficient delivery
Target met
We delivered all program2.1 administered items on time and on budget in 2018-19, indicating efficient delivery
Not previously measured
Analysis
This section provides an analysis of our program resourcing, output and efficiency:
⺠expenditure against our arts and cultural development budget program (program2.1) ⺠the effectiveness of our portfolio oversight activities (in both the arts and communications sectors)
⺠our efficiency delivering program2.1 administered items
78 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Program expenses
In 2018-19, expenses for arts and cultural development totalled $712.2 million (measure24), which was 2% more than budgeted in our 2018-19 Portfolio Additional Estimates Statements in February 2019, and 5% more than expended for program 2.1 in2017-18.
Payments to portfolio entities made up a large proportion — around 65% — of program 2.1 expenses. This reflects the importance we place on the activities of our portfolio entities, which provide increasing numbers of Australians with access to art and culturalexperiences.
It is worth noting that payments to the national broadcasters (ABC and SBS) are made under program1.1, in recognition of the work ABC and SBS do to promote connectivity for the millions of Australians who engage with the broadcasters’ platforms every month. However, it’s clear the national broadcasters are also important to achieving our creativity and culture purpose, through the production and broadcast of Australian content, stories and conversations.
Oversight of arts and cultural portfolio entities
We engage with portfolio entities to support their governance, sustainability and achievement, and work together to support participation and growth in arts and cultural activity, including with the national broadcasters (ABC and SBS). Portfolio entities are listed on page 56.
Our oversight activities focus on:
⺠entity corporate planning and annual reporting ⺠Budget and operational funding ⺠advising the Minister on governance arrangements, including Board appointments ⺠operational policy settings In 2018-19, we undertook all required activities, for effective oversight (measure 25).
Efficient program delivery
Our approach to program delivery focuses on the efficient management of public resources.
We delivered all program 2.1 administered items on time and on budget in 2018-19 (measure26). Further information on each is included in Table2.12.
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 79
Table 2.12 Administration of program 2.1 administered items
Administered item Results: timeliness Results: budget
1 Arts Agency Appropriations
We provided funding to support the operations of 10 arts portfolio entities — Australia Council, AFTRS, ANMM, MoAD, NFSA, NGA, NLA, NMA, NPGA, and ScreenAustralia.
Target met
Funding delivered in 2018-19
Target met
$461.3 million provided
2 Ausfilm
We provided funding to Ausfilm International Incorporated to support its role in attracting international production to Australia, in order to generate foreign investment, create jobs and upskill the domestic screen industry.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$1.7million provided
3 Australian Arts and Culture Fund
We reallocated remaining funding of $1.0million to support one-off strategic arts projects.
The Australian Arts and Culture Fund was established to support a broad range of arts projects, especially those by small to medium arts organisations. The fund was initially set up with funding of approximately $20.0million per year, but in the intervening years, changes to portfolio funding arrangements have transferred the majority of funds to the Australia Council and Creative Partnerships Australia.
Target met
Remaining funding reallocated in 2018-19
Target met
Funding reallocated to support one-off strategic arts projects
80 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Administered item Results: timeliness Results: budget
4 Australian Children’s Television Foundation
We provided funding to the Australian Children’s Television Foundation to support its role of providing funding and support to independent producers and writers of quality children’s programs.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$2.8 million provided
5 Australian Government International Exhibitions InsuranceProgram
We provided funding to collecting institutions to offset insurance costs for eligible international exhibitions touring to Australia. The program aims to give Australian audiences access to international artworks and cultural objects that might otherwise not be seen in Australia.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$2.1 million provided to support nine exhibitions
6 Bundanon Trust
We provided funding to Bundanon Trust to support its role as an Australian cultural institution and living arts centre. Bundanon Trust has a nationally significant collection of almost 4000 artworks valued at $43.0million and supports arts practice and understanding of the arts through its residency, education, exhibition and performance programs.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$1.5 million provided
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 81
Administered item Results: timeliness Results: budget
7 Creative Partnerships Australia
We provided funding to Creative Partnerships Australia to support its role to create a culture of private sector support for the arts. Creative Partnerships Australia aims to grow the culture of giving, investment, partnership and volunteering by delivering capacity-building programs, mentoring and training. More than 550projects were supported by Creative Partnerships Australia administered funding in 2018-19.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$4.5 million provided
8 Festivals Australia
We provided funding to support arts-driven experiences at festivals and significant one-off community celebrations in regional and remote Australia.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$1.2 million provided to support 26projects
9 Film Location Grant
We provided funding to support the production Aquaman to generate investment, and provide employment and upskilling opportunities for Australian cast, crew, post-production companies and other screen production service providers.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$22.1 million provided
82 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Administered item Results: timeliness Results: budget
10 Indigenous Languages and Arts
We provided funding to support participation in, and maintenance of, Australia’s Aboriginal and Torres Strait Islander cultures through languages and arts, in order to keepcultural identity strong within local communities and enhance Aboriginal and Torres Strait Islander peoples’ wellbeing.
The program provides annual operational funding for over 20 Indigenous language centres located primarily across regional and remote Australia.
During 2018-19, the department continued to deliver upon the government’s $10.0million budget measure to protect, preserve and celebrate Indigenous languages, which is being administered through the program.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$25.7 million provided to support 154 organisations to undertake 204projects
11 Indigenous Visual Arts Industry Support
We provided funding to Indigenous visual arts organisations in order to support a professional, viable and ethical Indigenous visual arts industry.
The program provided support to around 80 Indigenous owned art centres, as well as a number of art fairs, regional hubs and industry service organisations. Together these organisations supported morethan 6000 artists and over 300 arts workers.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$20.0 million provided to support 90activities
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 83
Administered item Results: timeliness Results: budget
12 Indigenous Visual Arts Industry Support — Visual Arts and Craft Strategy
We provided funding to Indigenous visual arts peak bodies to support professional development for Aboriginal and Torres Strait Islander artists.
The Visual Arts and Craft Strategy is a joint initiative of the Australian Government and state and territory governments to support a strong and dynamic contemporary visual arts and craft sector.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$866,000 provided to support five activities
13 International Cultural Diplomacy Arts Fund
We provided funding to support activities in Australia and around the world that promote the Australian Government’s international arts and cultural engagement and cultural diplomacy priorities.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$774,400 provided to support 10projects
14 Marking 250 years since James Cook’s first Voyage to Australia in 1770
We provided funding to the ANMM to assist with planning for the HMB Endeavour replica’s circumnavigation of Australia during 2020 and 2021.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$514,000 provided
15 National Collecting Institutions Touring and Outreach Program
We provided funding to eligible national collecting institutions to develop and tour exhibitions of their collections, to make Australian and overseas cultural material accessible to all Australians, especially regional communities.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$1.0 million provided to support 16exhibitions
84 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Administered item Results: timeliness Results: budget
16 National Elite Performing Arts Training Organisations
We provided funding to the national elite performing arts training organisations to support their operations, and contribute to Australia’s thriving creative economy.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$21.6million provided
17 One-off Strategic Projects — Arts and Cultural Development
We provided funding to support the following strategic projects:
⺠SBW Stables Theatre 50th Anniversary
⺠Brisbane Street Art Festival Valley Vision Project
⺠Australian Luthiers and Archetiers Congress
⺠Kaldor Public Art Projects 50th Anniversary Program
⺠First Nations Performing Arts New Work Development Program 2019-2022
⺠2019 Australian Reading Hour ⺠2019 National Indigenous Art Fair
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$514,661 provided to support sevenprojects
18 Prime Minister’s Literary Awards
The annual Prime Minister’s Literary Awards celebrate the contribution of Australian literature and history to our nation’s cultural and intellectual life.
Prizes were awarded to authors, historians and illustrators to recognise outstanding literary talent in Australia and acknowledge the valuable contribution that authors, historians and illustrators make in shaping our cultural identity.
Target met
Awards delivered in 2018-19
Target met
$648,581 provided to support 35authors, historians and illustrators, and administer the awards
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 85
Administered item Results: timeliness Results: budget
19 Public and Educational Lending Right Schemes
We made payments to Australian book creators (including authors, illustrators and editors) and publishers in recognition of the free multiple use of their books in public and educational lending libraries.
Target met
Payments delivered in 2018-19
Target met
$22.2million provided through 16,300 payments to eligible claimants, and to administer the schemes
20 Regional Arts Fund
We provided funding to Regional Arts Australia to manage the fund as a competitive grants program in support of sustainable cultural development in regional and remote communities.
The fund is delivered by Regional Arts Australia and regional arts organisations in each state and territory (Regional Arts Victoria, Regional Arts NSW, Country Arts WA, RANT Arts, Flying Arts Alliance, artsACT, Northern Territory Regional Arts and Country Arts SA).
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$3.6million provided to Regional Arts Australia, which supported 367projects
21 Screen Australia Departmental Grant
We provided funding to Screen Australia to support its role in the development of a highly creative, innovative and commercially sustainable Australian screen production industry.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$70.5 million provided
86 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Administered item Results: timeliness Results: budget
22 Visions of Australia
We provided funding to arts and cultural heritage organisations to support the development and touring of exhibitions of cultural material originating or created in Australia, as well as material from elsewhere held in Australian collections that reflects Australian life.
Target met
Funding delivered in 2018-19. Funding agreements maintained and payment milestones and reporting obligations achieved
Target met
$2.3million provided to support 28projects
23 Australian National Maritime Museum — Maritime Museums of Australia Project Support Scheme
We provided funding to the ANMM to administer the Maritime Museums of Australia Project Support Scheme for not-for-profit organisations caring for Australia’s maritime collections.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$105,000 provided to the ANMM, which supported 11projects, as well as offering internships and in-kind support
24 Museums and Galleries Australia Bursaries
We provided funding to administer bursary assistance to support attendance at the Australian Museums and Galleries Association’s national conference by museum staff and volunteers who are based in regional and remote areas, or are Aboriginal or Torres Strait Islander peoples.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$22,000 provided to the Australian Museums and Galleries Association, which supported 29people to attend the national conference, and covered Indigenous speaker costs
25 National Library of Australia — Community Heritage Grants
We provided funding to the NLA to administer Community Heritage Grants of up to $15,000 to community organisations to assist with the preservation of, and improved access to, locally owned but nationally significant heritage collections.
Target met
Funding delivered in 2018-19. Funding agreement maintained and payment milestones and reporting obligations achieved
Target met
$490,000 provided to the NLA, which supported 60projects
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 87
Administered item Results: timeliness Results: budget
26 Cultural Special Account — Meeting of Cultural Ministers
We transferred funding to the account in order to enable cross jurisdictional funding support for the program of collaborative work supporting the arts and culture sector, overseen by the Meeting of Cultural Ministers Officials Working Group.
Target met
Funding transferred in 2018-19
Target met
$196,000 provided
27 Indigenous Repatriation Special Account
We transferred funding to the account to support activities relating to the repatriation of Aboriginal and Torres Strait Islander ancestral remains from collecting institutions and private holders overseas, and both ancestors and secret sacred objects from seven major Australian museums, of the eight eligible for funding.
In 2018-19, we facilitated sixoverseas repatriations, with the remains of 98Aboriginal ancestors being returned to Australia.
Target met
Funding transferred in 2018-19
Target met
$659,000 provided
28 National Cultural Heritage Account
We transferred funding to the account in order to deliver a grant program to assist Australian cultural institutions to acquire significant cultural heritage objects.
In 2018-19, four National Cultural Heritage Account applications were approved.
Since the account was established, Australian cultural institutions have received over $6.4 million to assist in the acquisition of significant cultural heritage objects.
Target met
Funding transferred in 2018-19
Target met
$497,420 provided
88 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
How our performance statements accord with our Portfolio Budget Statements
Subsection 16F(1) of the PGPA Rule requires performance to be measured and assessedin accordance with the method set out in the corporate plan and PBS. The body of these statements reflects the structure of our revised 2018-19 Corporate Plan. Table 2.13 has been prepared to cross-reference to the location where performance is measured and assessed in accordance with the method set out in our 2018-19 PBS, onpages 25 and 29to 30.
It is worthwhile noting that the 2018-19 PBS measures have been superseded and we do not intend to report against them in future years.
Table 2.13 2018-19 Portfolio Budget Statements mapped to information in these statements
2018-19 PBS criteria and targets Location (or response)
Program 1.1: Digital technologies and communications services
Criteria Facilitate consumer access to affordable, competitive and reliable communications services
Targets Delivery of Mobile Black Spot Program Refer to Connectivity: access to effective communications services (page 25) which
includes Mobile coverage and the Mobile Black Spot Program(page28)
USO reform in response to Productivity Commission report
Refer to Connectivity: access to effective communications services (page 25) which includes Developing the new Universal Service Guarantee (USG) (page27)
Minister’s shareholder oversight of NBNCo’s delivery of the NBN
Refer to Connectivity: access to effective communications services (page 25) which includes National Broadband Network (NBN) andNBNCo (page 29)
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 89
2018-19 PBS criteria and targets Location (or response)
Targets (cont.) Consumer experiences using public data and research
Refer to Connectivity: access to effective communications services (page 25) which includes National Broadband Network (NBN) andNBNCo (page 29)
Stakeholder engagement to support improving consumer experience, including migration to the NBN
Refer to Connectivity: access to effective communications services (page 25) which includes National Broadband Network (NBN) andNBNCo (page 29)
Criteria Enable the effective operation of consumer protections and safeguards, so that Australians can interact safely in a trusted digital environment
Targets Progress of review of framework for consumer safeguards
Refer to Connectivity: inclusiveness of communications services (page 34) and Telecommunications Consumer Safeguards Review (page 31)
Engagement across government and industry to support effective consumer protections and safeguards
Refer to Connectivity: inclusiveness of communications services (page 34) which includes:
⺠Access for people with disability (page 36) ⺠The digital safety regulatory framework (page37)
Also refer to the section of the statements on Classification (page 72)
Information published on consumer protections Refer to Connectivity: inclusiveness of communications services (page 34)
which includes:
⺠Access for people with disability (page 36) ⺠The digital safety regulatory framework (page37)
Also refer to the section of the statements on Classification (page 72)
90 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
2018-19 PBS criteria and targets Location (or response)
Criteria Work with the sectors so that policy and regulatory frameworks support domestic and international competitiveness and the national interest
Targets Progress of reforms, including media Refer to Progress of media reforms (page 75)
Progress of reforms, including spectrum
⺠Preparing for 5G (page 47) ⺠International engagement on post and spectrum outcomes (page 43)
Progress of reforms, including copyright
Refer to Copyright (page 73)
Criteria Engage with portfolio agencies and sectoral institutions to support their governance, sustainability and achievement of government objectives
Target Oversight of portfolio agencies’ annual corporate plan compliance, financials and achievements
Refer to Oversight of communications portfolio entities (page 49)
Program 2.1: Arts and cultural development
Criteria Facilitate access to Australian arts, cultural experiences and related skills development opportunities
Targets Information on consumer engagement with national cultural institutions and artistic and cultural activities
Refer to Engagement with the national cultural institutions (page 56)
Information on access to the objects in the national collections (on display, on tour and online)
Refer to Engagement with the national cultural institutions (page 56)
Criteria Engage with portfolio agencies and sectoral institutions to support their governance, sustainability and achievement of government objectives
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 91
2018-19 PBS criteria and targets Location (or response)
Targets Oversight of portfolio agencies’ annual corporate plan compliance, financials and achievements
Refer to Oversight of arts and cultural portfolio entities (page 78)
Information on Commonwealth, state and territory, and philanthropic funding to the arts
⺠Program expenses, for information on Australian Government funding to the arts (page 78)
⺠In terms of state and territory government funding to the arts, this was estimated at $2.391billion in 2017-18. This figure is sourced from the Cultural Funding by Government 2017-18 survey which was released in July2019
⺠Philanthropic funding to the creative and cultural sectors (page 64)
Elite training institutions’ development of the next generation of arts performers and participants
Refer to Support to national elite performing arts training organisations (page 67)
Criteria Assist the arts in building sustainability and resilience and identifying opportunities for innovation
Targets Analysis of contribution of arts and cultural education to employment outcomes
⺠The economic value of creative and cultural activity (page 62)
⺠Support to national elite performing arts training organisations (page 67)
⺠In terms of analysis of the contribution of creative skills to employment outcomes, the latest Australian census data (2016) shows that over 1million people employed in Australia held a creative qualification as their highest level of qualification. Around 845,000 people were employed in creative or cultural industries and/ or occupations in 2016
⺠Our 2017-18 Annual Report stated that Australian Bureau of Statistics data showedthat over 1million people were employed in Australia’s creative sector in 2014-15. This figure is incorrect and should have been excluded
92 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
2018-19 PBS criteria and targets Location (or response)
Targets (cont.) Analysis of contribution of arts and culture to the
economy
⺠The economic value of creative and cultural activity (page 62)
⺠Support to national elite performing arts training organisations (page 67)
Criteria Work with the sectors to create and promote content that reflects Australia’s identity, character and cultural diversity
Targets Information provided through the Australia Council, ABC, SBS and departmental grant programs
⺠Creativity and culture: protecting and promoting Australian content (page 72)
⺠Creativity and culture: program resourcing (input), activity and efficiency (page 77)
Progress of the Australian and Children’s Screen Content Review
In terms of the Australian and Children’s Screen Content Review, this was completed in December 2017 (during the previous reporting period)
Criteria Collaborate with the sectors to protect, preserve and promote Australian culture, including Indigenous arts, language and repatriation
Targets Information from the Indigenous Languages and Arts program on Indigenous languages revived or maintained
Refer to Creativity and culture: protecting andpromoting Australian culture (page 66) which includes:
⺠Indigenous languages and arts (page 68) ⺠Australian creativity and culture internationally (page69)
⺠Preserving and promoting Australian national cultural heritage (page 70)
Access to cultural experiences and skills development opportunities in regional and remote areas, including by, and for, Aboriginal and Torres Strait Islander peoples
Refer to Creativity and culture: protecting and promoting Australian culture (page 66) which includes Indigenous languages and arts (page 68)
Information on Indigenous repatriation Refer to Preserving and promoting Australian national cultural heritage (page 70)
Information on international cultural activities and exchanges
Refer to Australian creativity and culture internationally (page69)
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 93
Methodology for calculating results against corporate plan performance measures
Table2.14 shows the method we will use to calculate results against performance measures in 2019-20.
Table 2.14 Methodology for calculating results
Measure (2018-19) Method to calculate result
1. Percentage of USO targets met by Telstra and community service obligations met by Australia Post
Analysis of reporting from Telstra and Australia Post
2. Percentage of population with access to mobile coverage Analysis of reporting by mobile network operators
3. Percentage of premises with NBN access (ready to connect) Analysis of NBN Co rollout reporting
4. Minimum fixed broadband download speeds available to Australian premises From 2020-21, analysis of NBN Co reporting
5. Assessment of telecommunications and postal services complaints data Analysis of reporting from the Telecommunications Industry Ombudsman
(TIO) and the ACMA on telecommunications complaints and reporting from the Postal Industry Ombudsman (PIO)
6. Assessment of affordability of telecommunications services (mobile and fixed) on offer
Analysis of reporting from the ACCC and of results from affordability indexes tracked in our Bureau of Communications and Arts Research, based on Household, Income and Labour Dynamics in Australia (HILDA) data
7. Impact of our programs on improving connectivity for people with disability Analysis of National Relay Service (NRS) provider reporting; analysis of ACMA
reporting on compliance by free-to-air television broadcasters on captioning compliance
94 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Measure (2018-19) Method to calculate result
8. Assessment of effectiveness of the digital safety regulatory framework Analysis of reporting by the ACMA on illegal offshore gambling websites; breaches of
rules for gambling promotions during live sporting events; data from the Office of the eSafety Commissioner; and results from the national eSafety survey
9. Percentage of ready-to-connect premises that have taken up NBN Analysis of NBNCo reporting
10. Assessment of the effectiveness of the department’s international engagement on post and spectrum outcomes
Analysis of results achieved
11. GDP contribution enabled by the communications sector Analysis of Australian Bureau of Statistics data by our Bureau of Communications and
Arts Research
12. Investment as a proportion of output in the communications sector Analysis of Australian Bureau of Statistics data by our Bureau of Communications and
Arts Research
13. Expenses for digital technologies and communications services (program 1.1) Analysis of financial statements (audited by the Australian National Audit Office)
14. Assessment of the effectiveness of the department’s oversight of communications portfolio entities
Analysis of oversight actions required and performed for each entity
15. Assessment of whether program1.1 administered items aredeliveredefficiently
For each administered item, analysis and comparison between projected and actual milestones and budget
PA R T 2 A n n u a l P e r f o r m a n c e S t a t e m e n t s 95
Measure (2018-19) Method to calculate result
16. Engagement with the national cultural institutions, indicated through:
(a) number of in-person visits to engage with national collecting institutions (including on- and off-site visits)
(b) percentage of objects in national collections accessible online
(c) number of web visits to the national cultural institutions
Analysis of reporting from the national cultural institutions
17. Assessment of the impact of our activities to support inclusion of:
(a) regional, rural and remote Australians
(b) people with disability
Analysis of regional grant program rollout; analysis of advancement of the National Arts and Disability Strategy
18. GDP contribution by the creative and cultural sectors, including:
(a) overall contribution
(b) contribution of broadcasting, electronic or digital media and film
(c) contribution of music composition and publishing
Analysis of Australian Bureau of Statistics data by our Bureau of Communications and Arts Research
19. Philanthropic funding to the creative and cultural sectors, including:
(a) estimated private sector support to the arts
(b) to organisations listed on the Register of Cultural Organisations
Analysis of Australian Bureau of Statistics data by our Bureau of Communications and Arts Research; analysis of reporting by organisations listed on the Register of Cultural Organisations
20. Number of students successfully completing courses at national elite performing arts training organisations
Analysis of reporting by the arts training organisations
96 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Measure (2018-19) Method to calculate result
21. Assessment of the impact of our programs on supporting, preserving and celebrating:
(a) Indigenous languages and arts
(b) Australian creativity and culture internationally
Analysis of a range of resources on Indigenous visual arts, Indigenous languages, Indigenous repatriation and international cultural engagement
22. Assessment of the effectiveness of the content regulatory framework forclassification, Australian content and copyright
Analysis of reporting on decisions by the Classification Board and the Classification Review Board; analysis of ACMA reporting on content compliance; analysis of reporting by copyright collecting societies and Australian Copyright Council; analysis of data from the annual Consumer Survey on Online Copyright Infringement
23. Assessment of whether the media regulatory framework is fit-for-purpose Analysis of reporting by the ACMA on media audiences, advertising trends and
broadcasting complaints, and reporting by ABC and SBS on audience metrics
24. Expenses for arts and cultural development (program2.1) Analysis of financial statements (audited by the Australian National Audit Office)
25. Assessment of the effectiveness of the department’s oversight of arts and cultural portfolio entities
Analysis of oversight actions required and performed for each entity
26. Assessment of whether program2.1 administered items aredeliveredefficiently
For each administered item, analysis and comparison between projected and actual milestones and budget
Part 3: Management and accountability This part of the report provides information about corporate governance and performance, external scrutiny, our people, and financial management.
Corporate governance and performance 98
External scrutiny 104
Management of humanresources 105
Financial management 113
98 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Corporate governance and performance
Management committees
Our management committees oversee key areas of our strategy and operations and implement the principles and objectives of good governance. The committees shown inFigure3.1 were operating in the 2018-19 reporting period.
Figure 3.1 Governance Committee Framework at 30June2019
Secretary’s Business Meeting
The Secretary’s Business Meeting is our main executive body and formally considers ministerial support matters, corporate policy matters, high-level policy, departmental resourcing (including non-IT capital investment proposals) and operational matters. TheSecretary’s Business Meeting consists of the Secretary, Deputy Secretaries and ChiefOperating Officer.
[Alt text (required on all figures, for accessibility): This is a chart showing the department’s Governance Committee Framework. The committees are:
⢠Secretary’s Business Meeting (weekly).
⢠Executive Leadership Team Meeting (weekly)
⢠Senior Executive Service (SES) Team Meeting (monthly)
⢠Finance, Human Resources and Risk Committee (monthly)
⢠Workplace Consultative Committee (triannually)
⢠Audit and Risk Committee (quarterly)
⢠Security Committee (every two months)
⢠Information Technology (IT) Governance Committee (every two months)
⢠IT Program Board (monthly)
⢠Health and Safety Committee (quarterly)
⢠Diversity and Inclusion Committee (every six weeks)
With the exception of the Workplace Consultative Committee, which reports to the Finance, Human Resources and Risk Committee, and the IT Program Board, which reports to the IT Governance Committee, all committees report to the Secretary].
SES Team Meeting
(monthly)
Secretary
Secretary’s Business Meeting (weekly)
Audit and Risk Committee (quarterly)
Health and Safety Committee (quarterly)
Security Committee (every two months)
IT Governance Committee (every two months)
IT Program Board (monthly)
Diversity and Inclusion Committee (every six
weeks)
Executive Leadership Team Meeting (weekly)
SES Team Meeting (monthly)
Finance, Human Resources and Risk Committee (monthly)
Workplace Consultative Committee (triannually)
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 99
Executive Leadership Team Meeting
The Executive Leadership Team Meeting is our main executive business and coordination forum. The meeting:
⺠provides the Executive Leadership Team with an opportunity to discuss key issues concerning our performance, areas for improvement and upcoming priorities
⺠receives briefings from First Assistant Secretaries on key issues for each division ⺠considers monthly financial and human resource reports and weekly ministerial and governance-related reports
The Executive Leadership Team Meeting comprises the Secretary, Deputy Secretaries and First Assistant Secretaries. Senior Executive Service (SES) staff from the Corporate Division attend as advisers.
Senior Executive Service (SES) Team Meeting
The SES Team Meeting, comprising the Secretary and all departmental SES staff, providesan opportunity to:
⺠promote closer links and engagement as an SES group ⺠provide learning and development training for the SES ⺠encourage participation by SES employees in organisational management discussions ⺠provide feedback from SES employees to the Executive on key management issues
⺠update the SES group on important government, Australian Public Service (APS) and departmental policy and operational matters
Finance, Human Resources and Risk Committee
The Finance, Human Resources and Risk Committee:
⺠oversees our Budget process ⺠considers our monthly financial reports ⺠recommends Budget priorities to the Secretary ⺠oversees the development of our annual report
⺠considers our monthly human resources and workforce reports ⺠provides a forum for financial and human resource management issues to be raised anddiscussed
⺠considers risks to our achievement of finance and human resource strategic and operational objectives
The membership comprises the Secretary, Deputy Secretaries, Chief Operating Officer, Chief Financial Officer, and Assistant Secretaries from the Human Resources and Security Branch and the Governance Branch.
[Alt text (required on all figures, for accessibility): This is a chart showing the department’s Governance Committee Framework. The committees are:
⢠Secretary’s Business Meeting (weekly).
⢠Executive Leadership Team Meeting (weekly)
⢠Senior Executive Service (SES) Team Meeting (monthly)
⢠Finance, Human Resources and Risk Committee (monthly)
⢠Workplace Consultative Committee (triannually)
⢠Audit and Risk Committee (quarterly)
⢠Security Committee (every two months)
⢠Information Technology (IT) Governance Committee (every two months)
⢠IT Program Board (monthly)
⢠Health and Safety Committee (quarterly)
⢠Diversity and Inclusion Committee (every six weeks)
With the exception of the Workplace Consultative Committee, which reports to the Finance, Human Resources and Risk Committee, and the IT Program Board, which reports to the IT Governance Committee, all committees report to the Secretary].
SES Team Meeting
(monthly)
100 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Workplace Consultative Committee
The Workplace Consultative Committee is the principal forum through which formal consultation and discussions on workplace relations matters take place between management and employees.
The committee is comprised of the Chief Operating Officer, Assistant Secretary HumanResources and Security, and staff representatives from each of the department’sdivisions.
Audit and Risk Committee
The Audit and Risk Committee provides independent advice and assurance to the Secretary on the appropriateness of financial and performance reporting, the system of risk oversight and management, and internal control. The committee is comprised of external and internal members and has an independent chair.
Security Committee
The Security Committee was established to discuss matters that affect the security and safety of departmental employees and the security of departmental offices. It also acts as an advisory and decision-making committee addressing issues and providing advice to the Secretary in relation to security governance within the department.
The committee is comprised of the Chief Security Officer, Assistant Secretary Human Resources and Security, Chief Information Officer, Assistant Secretary Governance, Agency Security Adviser, IT Security Adviser, First Assistant Secretary Market Reforms, Assistant Director Property and Security, and Senior Adviser Property and Security (meeting secretariat).
Information Technology (IT) Governance Committee
The IT Governance Committee:
⺠develops a common vision for our IT requirements and information governance ⺠oversees our data requirements and determines data collection priorities ⺠ensures that our information is managed for its entire life in accordance with risk, including risks associated with security, access, privacy, continuity and cost
⺠recommends IT governance funding priorities to the Secretary ⺠recommends appropriate information security policies to the Secretary ⺠oversees internal information reviews to identify information assets and their value, manages risk and compliance, and improves business processes
⺠provides a forum for IT and information governance to be raised and discussed ⺠makes decisions informed by the portfolio risk assessment The committee is comprised of a Deputy Secretary, the Chief Information Officer, Chief Operating Officer, Chief Financial Officer and twoExecutive Leadership Teamrepresentatives.
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 101
Information Technology (IT) Program Board
The IT Program Board:
⺠provides guidance on and oversight of key IT projects to ensure timely efficient and effective delivery of quality outcomes
⺠identifies, manages, mitigates, escalates and resolves risks and issues managed by the program board, takes action as required and escalates risks to the IT Governance Committee
⺠ensures program products and deliverables are fit-for-purpose including acceptance of key deliverables and changes in scope as required
⺠monitors project progress, and provides sign-off on key project documentation and on final product releases
⺠ensures benefits are managed/realised once a project closes The Board reports up to the IT Governance Committee on project progress and any issues. The Board comprises the Chief Operating Officer, Chief Information Officer, Chief Financial Officer, Assistant Secretary representatives from various business areas, and project directors and managers.
Health and Safety Committee
The Health and Safety Committee is a key forum that supports our safety culture. It is an integral component of our Workplace Health and Safety (WHS) Framework and has responsibility for achieving positive outcomes in the management of WHS issues.
The committee is comprised of a staff representative from each of the department’s divisions, our WHS Officer, and the Assistant Secretary Future Connectivity Branch, whois the committee’s chair.
Diversity and Inclusion Committee
The Diversity and Inclusion Committee supports the work of the whole-of-government Secretaries’ Equality and Diversity Committee which is committed to improving diversity across the APS. Our committee assists to achieve this commitment by removing barriers to enable staff to realise their full potential. The committee is comprised of our SES Champions (Disability, Gender equality, Indigenous, Cultural and linguistic diversity, LGBTQIA+) and fourstaff representatives.
Planning and reporting framework
Our internal and external planning and reporting framework, shown in Figure3.2, sets out our approach to managing organisational performance. Planning takes place in advance of each financial year. Regular progress reporting, which aligns with the Budget process, is built into the framework. Business plan reviews, in particular, give the department’s Executive the ability to review business priorities, risk and the operating environment, andmake adjustments, including to strategy and governance arrangements, if required.
102 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Figure 3.2 Planning and reporting framework
Outcomes
Planning
External
(in accordance with PGPA Act)
Internal
Portfolio Budget Statements
Divisional Business Plans
Business Plan Reviews
Corporate Plan
Individual Performance Plans
Mid-Cycle and End-Cycle Review
Reporting
Annual Report/ Annual Performance Statements
Inputs:
⺠Strategic vision ⺠Performance measures
⺠Purposes ⺠Legislative requirements
⺠Government priorities and commitments (including election commitments)
Supporting frameworks:
⺠Risk Management Framework
⺠Workforce strategies ⺠Australian Government Financial Framework
⺠Information Technology Strategic Plan
⺠Protective Security Policy Framework
⺠Information Security Management
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 103
Internal audit and risk management
During 2018-19, internal audit services were provided by BellchambersBarrett and RSMAustralia. Delivery of these audit services was overseen by our internal audit team and the Audit and Risk Committee.
At 30June2019, three internal audits had been completed during the reporting period, and oneinternal audit was underway.
The internal audit team tracked recommendations and reported progress to the Audit andRisk Committee and the Secretary.
Our Risk Management Framework includes our Risk Management Policy, Risk Management Instruction and Fraud Control Plan. The framework facilitates a culture that promotes an open and proactive approach to managing risk. It encourages risk assessment, informed risk taking, and the anticipation and treatment of risk in delivering our objectives.
Our risk oversight includes regular monitoring and reporting on risk through the business planning and review process and the Audit and Risk Committee.
Promoting appropriate ethical standards
Our Handling Misconduct policy and procedures support compliance with the APS Code of Conduct, APS Employment Principles and APS Values. We recognise that adherence to the APS Code of Conduct contributes to a positive working environment, particularly through treating everyone with respect and courtesy and without harassment.
104 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
External scrutiny
The Australian National Audit Office published one performance audit report that involved our participation in 2018-19, Governance of the Special Broadcasting Service Corporation, published 26 April 2019.
Freedom of information (FOI)
Under PartII of the Freedom of Information Act 1982 (FOIAct), we publish information to the public as part of the Information Publication Scheme (IPS). Our website includes our Information Publication Scheme Plan, which shows the information we publish in accordance with IPS requirements. We also publish our FOI disclosure log online.
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 105
Management of humanresources
Managing and developing employees
In 2018-19, we were effective in managing and developing employees to achieve entity objectives. This is demonstrated through information on developments during the year in relation to workforce planning, entry level programs, staff retention and turnover, training and development, and productivity gains.
Workforce planning
This year, we developed a three-year workforce plan to enable us to plan and be prepared for the workforce of the future.
In developing our plan, we reviewed our business plans to understand our future operating environment and organisational priorities. We considered our current workforce profile and forecast our workforce needs. We identified gaps between current and future capability and structural needs, and identified four strategies to address our findings:
⺠build our capacity to meet changing business priorities ⺠improve knowledge sharing and retention ⺠enhance management capability ⺠enhance workforce capability In 2019-20, we will commence implementation of our workforce plan. We will continue to identify ways of developing our workforce in line with our identified strategies and through our people strategies, particularly our learning and development strategy and ourrecruitment strategy.
Entry level programs
In January 2019, we welcomed 13 new graduate employees into the department. Our entry level programs continue to provide a way to attract and recruit high calibre graduates with the skills and capabilities required to support the department. The 2020 graduate recruitment process has been aligned to the department’s capability and succession planning needs as outlined in the workforce plan and has a particular focus onthe critical positions over the next one to three years.
106 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Staff retention and turnover
Our staff separation rate during 2018-19 was 20.6% (111). This includes 52.3% (58) employees who went to another APS agency and 47.7% (53) who retired (9), resigned (42) and took redundancies (2).
Table 3.1 2018-19 staff commencements and terminations
Commencements Terminations
Ongoing Non-ongoing — specified term Ongoing Non-ongoing — specified term
Female 58 20 66 18
Male 28 11 45 9
Total 86 31 111 27
117 138
Note: Data does not include casual employees or temporary transfers.
Training and development
In 2018-19, we continued our focus on policy fundamentals, leadership and management, and performance conversations to enhance the performance of our workforce. We have also continued to build cultural awareness within the agency, and project management capability. Concurrently, we commenced a new learning and development strategy.
Our new learning and development strategy will be implemented in the first half of 2019-20 and intends to empower our people to learn, develop and grow their expertise through on-the-job experiences and from each other. We have placed an emphasis on building a culture of learning, deepening our expertise and knowledge of our domain, andenabling our people to respond in a rapidly changing environment.
In 2018-19, we have:
⺠delivered training to support staff and managers to have constructive performance conversations
⺠delivered our Leadership and Management Program to increase manageraccountability, knowledge and confidence
⺠delivered unconscious bias training and the Warumilang Cultural Awareness Training as well as continued to promote the Core Cultural Learning course developed by the Australian Institute of Aboriginal and Torres Strait Islander Studies to contribute to a culturally inclusive work environment
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 107
⺠partnered with the Crawford School of Public Policy at the Australian National University to build our policy expertise
⺠increased our support to upskill the workforce through our studiesassistance In 2018-19, we introduced eight mandatory eLearning modules for all staff. These modules are required to be completed by all staff each year to support the department’s compliance obligations. The annual suite of compliance modules ensures allstaff are informed of their key obligations, responsibilities and duties in their role within the department and as part of the APS. This will continue to be an annual focus, with further embedding within individual performance plans and performance conversations toensure all staff are compliant.
Productivity gains
Our main capability development programs are evaluated using pre- and post-program data that measures shifts in participant learning and applicability of learning to work.
As an example, our Leadership and Management Program has shown notable improvements in post-program measures across key managerial responsibilities and attitudes towards team management. Both our performance conversation programs showed positive shifts in skills and confidence to engage in constructive performance conversations. Evaluation of our policy program showed relevance and applicability of thecoursework to participants’ daily work.
Our revised learning and development strategy will include a matured model of evaluationof learning.
Disability reporting
Between 1994 and 2007-08, Australian Government entities reported on their performance as policy adviser, purchaser, employer, regulator and provider under theCommonwealth Disability Strategy. In 2007-08, reporting on the employer role wastransferred to the Australian Public Service Commission’s Stateof the Service Report andthe APS Statistical Bulletin. These reports are available at apsc.gov.au. From2010-11, entities have no longer been required to report on any of these functions.
The Commonwealth Disability Strategy was superseded by the National Disability Strategy 2010-2020, which sets out a 10-year national policy framework to improve the lives of people with disability, promote participation and create a more inclusive society. Every two years, a high-level report tracks progress against each of the outcome areas of the strategy and presents a picture of how people with disability are faring. The first of these progress reports was publishedin 2014. Reports can be found at dss.gov.au.
108 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Workplace diversity
Ourthree-year Diversity and Inclusion Strategy 2016-2019 helps ensure our workforcereflects, respects and benefits from diversity. Our strategy aims to encourage commitment to diversity across the department. It outlines strategies for attraction, development and retention of a diverse workforce, including accountability for the measurement of outcomes.
Our Diversity and Inclusion Strategy 2016-2019 is actively supported by the following action plans:
⺠Carers Action Plan ⺠Culturally and Linguistically Diverse Action Plan 2019 ⺠Disability Action Plan ⺠Gender Action Plan 2017-2019
⺠Lesbian, Gay, Bisexual, Trans, Queer, Intersex, Asexual and other sexualities (LGBTQIA+) Action Plan
⺠Reconciliation Action Plan Departmental networks are an integral part of our Diversity and Inclusion Strategy, together with SES Diversity Champions and staff representation on our Diversity and Inclusion Committee.
In the past year, we have continued to focus on recruitment and retention, to ensure that staff members with disability are supported in the workplace, in appropriate and meaningful positions that maximise their contribution. This included:
⺠affirmative measures recruitment for a bulk APS 2 round ⺠our involvement with the Australian Network on Disability, as a goldmember of thenetwork
⺠celebrating International Day of People with Disability, by launching a new exhibition space in our Canberra office showcasing work by artists with disability in the region, inconjunction with the Belconnen Arts Centre
⺠our Disability and Allies Network, which continued to host events to engage and inform staff on matters of inclusion and disability pride, including fundraising for an employee to participate in the Special Olympics in AbuDhabi, United Arab Emirates, and hosting an event for International Guide Dog Day
Our 2020 Graduate Program recruitment campaign continued to encourage applications from people with disability, Aboriginal and Torres Strait Islander peoples, LGBTQIA+ people, those from culturally and linguistically diverse backgrounds and those of mature age. Aboriginal and Torres Strait Islander graduates or graduates with disability were invited to apply through affirmative measures.
Our Reconciliation Action Plan contributes to embracing a whole-of-department approach to building stronger internal and external relationships with Aboriginal and Torres Strait Islander peoples, organisations and communities.
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 109
The United Nations declared 2019 the International Year of Indigenous Languages, raising awareness about the crucial role of languages. To contribute, our website featured stories and articles, which were also circulated to other departments and agencies. Wesupported NAIDOCweek by being a partner for the ACTNAIDOC Awards night andsponsoring the Artist of the Year.
We have sustained our focus on Indigenous employment, by continuing the development of our Employment Strategy, with a focus on increasing employment participation of Aboriginal and Torres Strait Islander peoples.
Our contribution to increasing the representation of Aboriginal and Torres Strait Islanderemployees to meet our target of 4.5% is progressing. At 30June2019, we had 24employees who identify as an Aboriginal or Torres Strait Islander person (4.24% of our workforce). Table3.2 presents statistics from 30 June 2018 and 30June2019.
Table 3.2 Employees who identify as Indigenous
Total at 30 June 2018 Total at 30 June 2019
Ongoing 22 24
Non-ongoing 1 -
Total 23 24
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June for a total period greater than 90days).
The Pride and Allies Network continued to promote inclusion of people who identify as LGBTQIA+. In 2018-19, the network has promoted inclusion through internal events such as supporting LGBTQIA+ children and loved ones, participating in external all-APS events and promoting resources for managers and supervisors within the department including a manager’s guide to LGBTQIA+ workplace inclusion.
In 2017, our Gender Action Plan 2017-2019 was well-received within the department and across the APS as a benchmark example. We are now preparing to design a new plan which will outline aspirational but attainable actions and objectives, and will be informed by our progress in implementing the plan.
In 2018-19, the Gender Equality Network continued to organise activities to raise awareness and staff engagement in relation to gender issues, including facilitating staff cohort attendance at events, such as the She Leads Conference, Australian Gender Economics Workshop 2019 and the All About Women festival, and hosting talks by distinguished women in art, letters, politics and community work.
110 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Our Cultural and Linguistic Diversity (CALD) Network continued its work promoting and engaging on matters that impact people from a culturally and linguistically diverse background. The network delivered on all action items identified in our CALD Action Plan, which is linked to our Diversity and Inclusion Strategy.
Terms and conditions of employment
Enterprise Agreement
Our Enterprise Agreement was re-negotiated in August2018 and came into effect on 1February2019. In accordance with the Secretary’s determination of 31January2019, eligible staff received a 2%pay increase with effect from 24October2018. The agreement, which nominally expires on 1February2022, covers all non-SES staff employed under the Public Service Act 1999. At 30June2019, the Enterprise Agreement covered 527staff.
Individual flexibility arrangements
A total of 17 non-SES employees had an individual flexibility arrangement in place during 2018-19. These were provided to recognise skill, additional responsibility, additional hours worked and salary maintenance.
Australian workplace agreements and common-law contracts
We have no workplace agreements or common-law contracts in place.
Executive remuneration
Section 17AD(da) of the Public Governance, Performance and Accountability Rule 2014 (PGPA Rule) requires the annual report to include information about executive remuneration.
Public office holders
The Secretary’s remuneration and terms of employment is determined by the Remuneration Tribunal. It reviews the Departmental Secretaries — Classification Structure and Terms and Conditions Determination annually.
The remuneration and terms of employment for the full-time members of the Classification Board, including the Director and Deputy Director, are also determined by the Remuneration Tribunal. It reviews the Remuneration Tribunal (Remuneration and Allowances for Holders of Full-time Public Office) Determination annually.
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 111
Senior Executive Service (SES)
The terms and conditions of employment for SES staff are contained in individual determinations made under subsection24(1) of the Public Service Act. These instruments set the remuneration and employment conditions for SES staff and provide for non-salary inclusions relating to leave arrangements and entitlements, superannuation, salary sacrifice and travel.
The department’s SES Remuneration Policy provides SES employees with information about their remuneration arrangements. The policy should be read in conjunction with an employee’s determination.
The Secretary will determine an SES employee’s annual salary and any increases that areapplied. The main principles guiding the remuneration of SES staff within the department are:
⺠to attract and retain high-quality SES ⺠rewarding individuals according to their assessed contribution and performance against corporate objectives
⺠providing remuneration that is competitive within the APS and complies with the APS Executive Remuneration Management Policy
⺠providing a remuneration regime that is equitable, consistent and fair
Non-salary benefits provided to employees
Employees may access a range of salary sacrifice benefits including:
⺠membership fees and subscriptions to professional associations ⺠home office expenses ⺠financial counselling fees ⺠disability/income protection insurance premiums
⺠self-education expenses (work related) ⺠superannuation ⺠motor vehicle (for private use) by way of Novated Lease ⺠portable electronic devices
⺠airline lounge benefits In addition, we provide our employees with a range of non-salary benefits including activities targeting health and wellbeing, support for professional and personal development, access to flexible work arrangements and a range of unpaid leave entitlements.
Flexibility arrangements
Our commitment to working flexibly is clearly articulated in our People Plan and our Diversity and Inclusion Strategy.
112 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Workplace flexibility encompasses how we work in the office and allows staff to match their workspaces with their work type, through use of quiet spaces, collaboration places and technology. It also includes structures to manage surge capacity, and flexible job design and work practices.
We have a number of flexible work arrangements in place that allow for staff to work in locations other than the office (for example, working from home) to manage work-life balance. We also have a number of staff who work part-time.
Our technology, which includes laptops for all employees, soft phones and Skype for Business, underpins and enables our flexible work arrangements.
Staff engagement
We continue to be focused on building an organisational culture in which our values and behaviours make the department a great place to work. Targeted activities aimed at building staff engagement and embedding culture are delivered through the staff-led networks including the:
⺠CALD Network ⺠Carers Network ⺠Disability and Allies Network ⺠Flexible Work Arrangements Working Group
⺠Gender Equality Network ⺠Indigenous Staff Network ⺠Parental Leave Working Group ⺠Pride and Allies Network
⺠Social Club ⺠Vacation Care Working Group These networks meet regularly to ensure individual network or group events are aligned with our broader cultural objectives.
In addition to staff-led networks, we have established departmental networks, of which staff are nominated by their colleagues or self-elect to be members, providing opportunities to contribute towards the operation and cultural development of the department. These networks include the:
⺠Diversity and Inclusion Committee ⺠Health and Safety Committee ⺠Workplace Consultative Committee
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 113
Financial management
Assets management
In 2018-19, our assets management processes were effective. Our capital plan reflects the government’s priorities and business needs and complies with the financial management framework. We monitor asset acquisitions and disposals against this plan, and we carry out a risk-based annual stocktake for non-artwork targeting key asset classes or events to update and verify the accuracy of our asset records and review their condition and utility. A separate stocktake of all artworks held on premises by Artbank is completed once a year.
Purchasing
In terms of performance against the Commonwealth Procurement Rules, our procurement policies and processes in 2018-19 were consistent with the rules, and with the Public Governance, Performance and Accountability Act 2013 (PGPA Act). Appropriate controls are in place to ensure procurement is carried out in accordance with the rules and with legislative requirements.
We publish procurement activities and annual procurement plans on AusTender. Information on expected procurement activities in 2019-20 is included in our latest annual procurement plan and is also available on AusTender.
Consultants
We engage consultants to provide specialised professional services when we do not have the capability or capacity to perform these in-house, or where we need independent research, review, assessment or advice. Consultants are typically engaged to investigate or diagnose a specific issue or problem, carry out reviews or evaluations, and provide independent advice, information or solutions to help us make decisions.
Before engaging consultants, we take into account the skills and resources needed for the task, the skills available internally and the cost-effectiveness of engaging external expertise. Our policy for selecting and engaging consultants in 2018-19 was in accordance with the PGPA Act and the Commonwealth Procurement Rules: it is based on the core principle of achieving value for money.
114 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
The main categories in which consultants were engaged are for the provision of:
⺠legal services ⺠auditing and accounting services ⺠economic services ⺠other professional services, including in relation to engineering, broadcasting,
telecommunications and the arts
During 2018-19, 68 new consultancy contracts were entered into involving total actual expenditure during that period of $2.5 million. In addition, 22 ongoing consultancy contracts were active during 2018-19, involving total actual expenditure during that period of $0.9million. Therefore, total consultancy expenditure during 2018-19 was $3.4million. Figure 3.3 shows expenditure on consultancy contracts since 2015-16.
Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website.
Figure 3.3 Expenditure on consultancy contracts, 2015-16 to 2018-19
1
2
3
4
5
6
2018-19 2017-18 2016-17 2015-16
$ million
PA R T 3 M a n a g e m e n t a n d A c c o u n t a b i l i t y 115
Procurement initiatives to support small business
We support small business participation in the Australian Government procurement market. Small and medium-sized enterprises and small enterprise participation statistics are available on the Department of Finance’s website.
We continue to meet government policy requirements in terms of supporting small and medium enterprises in the following ways:
⺠Our approach-to-market documents are clear and straightforward to help potential suppliers to produce a response that does not require extensive time and effort.
⺠Our processes facilitate the payment of invoices on time, and our financial management information system identifies late payments so that remedies can be applied.
⺠We use the Commonwealth Contracting Suite for eligible procurements valued under $200,000 (GST inclusive).
⺠Where procurements are considered low risk and their value is below the procurement threshold of $80,000 (GST inclusive), a streamlined process is followed.
⺠For procurements valued under $10,000 (GST inclusive), we encourage the use of payment by credit card.
⺠We have exceeded our portfolio target for supporting Indigenous businesses. In2018-19, we raised awareness of the Commonwealth Indigenous Procurement Policyincluding with our portfolio entities, many of which are not bound by the policy. In 2018-19, our portfolio achieved 464 new contracts with Indigenous businesses worth $38.5 million against a full-year target of 18 new contracts.
We recognise the importance of ensuring that small businesses are paid on time. Theresults of the Survey of Australian Government Payments to Small Business are published by the Treasury on its website.
Grants
Information on grants awarded by the department during 2018-19 is available on the GrantConnect website.
Part 4: Financial statements This part of the report contains our audited financial statements for the year ended 30June2019, in accordancewith subsection 43(4) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).
118 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
2
Contents Certification Independent Audit Report Statement by the Accountable Authority and Chief Financial Officer
Primary financial statements
Statement of Comprehensive Income Statement of Financial Position Statement of Changes in Equity Cash Flow Statement Administered Schedule of Comprehensive Income Administered Schedule of Assets and Liabilities Administered Reconciliation Schedule Administered Cash Flow Statement
Overview
Notes to the financial statements
1. Departmental Financial Performance 1.1 Expenses 1.2 Own-Source Revenue and Gains
2. Income and Expenses Administered on Behalf of Government 2.1 Administered - Expenses 2.2 Administered - Income
3. Departmental Financial Position 3.1 Financial Assets 3.2 Non-Financial Assets 3.3 Payables 3.4 Other Provisions
4. Assets and Liabilities Administered on Behalf of Government 4.1 Administered - Financial Assets 4.2 Administered - Non-Financial Assets 4.3 Administered - Payables 4.4 Administered - Provisions
5. Funding 5.1 Appropriations 5.2 Special Accounts 5.3 Regulatory Charging Summary
6. People and Relationships 6.1 Employee Provisions 6.2 Key Management Personnel Remuneration 6.3 Related Party Disclosures .
7. Managing Uncertainties 7.1 Contingent Assets and Liabilities 7.2 Financial Instruments 7.3 Administered - Financial Instruments 7.4 Fair Value Measurement . 7.5 Administered - Fair Value Measurements
8. Other Information 8.1 Aggregate Assets and Liabilities 8.2 Restructuring 8.3 Budgetary Reports and Explanations of Major Variances
PA R T 4 F i n a n c i a l S t a t e m e n t s 119
GPO Box 707 CANBERRA ACT 2601 19 National Circuit BARTON ACT Phone (02) 6203 7300 Fax (02) 6203 7777
Auditor-General for Australia
INDEPENDENT AUDITOR’S REPORT
To the Minister for Communications, Cyber Safety and the Arts
Opinion
In my opinion, the financial statements of the Department of Communications and the Arts (‘the Entity’) for the year ended 30 June 2019:
(a) comply with Australian Accounting Standards - Reduced Disclosure Requirements and the Public Governance, Performance and Accountability (Financial Reporting) Rule 2015; and
(b) present fairly the financial position of the Entity as at 30 June 2019 and its financial performance and cash flows for the year then ended.
The financial statements of the Entity, which I have audited, comprise the following statements as at 30 June 2019 and for the year then ended:
ï· Statement by the Accountable Authority and Chief Finance Officer; ï· Statement of Comprehensive Income; ï· Statement of Financial Position; ï· Statement of Changes in Equity;
ï· Cash Flow Statement; ï· Administered Schedule of Comprehensive Income; ï· Administered Schedule of Assets and Liabilities; ï· Administered Reconciliation Schedule; ï· Administered Cash Flow Statement; and ï· Notes to the financial statements, comprising a Summary of Significant Accounting Policies and other
explanatory information.
Basis for opinion
I conducted my audit in accordance with the Australian National Audit Office Auditing Standards, which incorporate the Australian Auditing Standards. My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report. I am independent of the Entity in accordance with the relevant ethical requirements for financial statement audits conducted by me. These include the relevant independence requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) to the extent that they are not in conflict with the Auditor-General Act 1997. I have also fulfilled my other responsibilities in accordance with the Code. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.
Key audit matters
Key audit matters are those matters that, in my professional judgement, were of most significance in my audit of the financial statements of the current period. These matters were addressed in the context of my audit of the financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters.
120 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Key audit matter
Valuation of Administered Loans
RefertoNote4.1B‘TradeandOtherReceivables’and Note7.3‘Administered-FinancialInstruments’
The Entity administers a loan to NBN Co Limited which as at 30 June 2019 was valued at $13 053 million.
Ifocusedonthisareagiventhesignificanceofthe balancetotheEntityandtheneedforconsiderable judgementstobemadeinassessingwhetherthereis anyimpairmentofNBN’sloanbalance.
TheNBNloanisassessedforimpairmentbasedonan expected credit loss model underpinned by assumptions which require significant judgements abouttherecoverabilityoftheloan.Thesignificant judgements are based on expected cash flow forecasts and refinancing plans, indicative credit ratings,andprobabilitiesofdefaulteventsoccurring, notingtheabsenceofmarketcomparisons.Changes inassumptionscanresultinmaterialimpactsonthe expectedcreditlossand,accordingly,valuationofthe loan.
How the audit addressed the matter
ToaddressthekeyauditmatterIhave:
ï· assessed the reasonableness of the Entity’s methodforidentifyingforwardlookingcreditloss indicators,andthetechniqueusedtoestimate creditloss;
ï· considered the competence and objectivity of management’s expert, and evaluated the reasonablenessoftherationaleandapplication oftheexpectedcreditlossmodel;
ï· assessedthereasonablenessofkeyassumptions bycomparingthemtospecificentityorindustry benchmarkswithappropriateadjustmentforthe loan arrangements and evaluated the model's sensitivitytokeyinputs;and
ï· tested the calculation logic and arithmetic accuracyofthemodel.
Key audit matter
Valuation of Administered Investments - NBN Co Limited
RefertoNote4.1C‘OtherInvestments’andNote7.5A ‘FairValueMeasurements’
The Entity has measured the fair value of its InvestmentinNBNCoLimitedtobe$8682millionas at30June2019.
ThevaluationoftheInvestmentinNBNCoLimitedis a key audit matter due to the significance of the balanceandthesignificantjudgementappliedbythe Entityindeterminingandapplyingtheappropriate valuation approach, which is depreciated replacementcost.
Determining the fair value of NBN Co Limited is complex and requires significant professional judgementondeterminingthefairvalueofnetwork assetswithinproperty,plantandequipment(PP&E) thatarereportedonacostbasisinNBNCoLimited’s financialstatements.Thefairvaluecalculationfor network assets requires the Entity to make judgementsaboutstageofcompletion,technological and economic obsolescence assessments andcash flowforecasts.
How the audit addressed the matter
ToaddressthekeyauditmatterIhave:
ï· assessed the appropriateness of the valuation approach used by the Entity to value NBN Co Limited against similar industry practice and AustralianAccountingStandards;
ï· assessedtheEntity’scalculationoffairvalueof NBN Co Limited’s PP&E considering the appropriatenessofkeyassumptionsandinputs usedincludingstageofcompletion,technological and economic obsolescence assessments and cashflowforecasts;
ï· considered the sensitivity of the valuation by varying certain inputs in the Entity’s fairvalue calculationsincludingNBNCoLimited’seconomic obsolescenceassessmentandcashflowforecasts tootheroutcomesthatIconsideredreasonably possible.
PA R T 4 F i n a n c i a l S t a t e m e n t s 121
Key audit matter
Valuation of Administered Investments - Australian Postal Corporation
Refer to Note 4.1C ‘Other Investments’ and Note 7.5A ‘Fair Value Measurements’
The Entity has estimated the fair value of its Investment in the Australian Postal Corporation to be $2 225 million as at 30 June 2019.
The valuation of the Australian Postal Corporation, using a discounted cash flow model, is a key audit matter because the valuation model is dependent on assumptions that require significant management judgement about the discount rate, terminal value, growth rate and probabilities of future cash flows which are not based on observable market information.
How the audit addressed the matter
To address the key audit matter I have:
ï· assessed the appropriateness of the Entity’s valuation method, assumptions and inputs used in the valuation model, including the cash flow forecasts and discount rate. This included:
⢠consideration of the valuation methodology used against similar industry practice and Australian Accounting Standards;
⢠testing the reasonableness of assumptions underpinning net cash flows, in the valuation model against estimates and publications produced by the Australian Postal
Corporation;
⢠assessed the Entity’s comparison of key inputs used in the valuation model against market information related to the valuation of listed companies with comparable operations; and
ï· considered the sensitivity of the valuation by adjusting the discount rate, terminal value growth rate, probabilities attached to future scenarios to other outcomes that I considered reasonably possible.
Accountable Authority’s responsibility for the financial statements
As the Accountable Authority of the Entity, the Secretary is responsible under the Public Governance, Performance and Accountability Act 2013 (the Act) for the preparation and fair presentation of annual financial statements that comply with Australian Accounting Standards - Reduced Disclosure Requirements and the rules made under the Act. The Secretary is also responsible for such internal control as the Secretary determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Secretary is responsible for assessing the ability of the Entity to continue as a going concern, taking into account whether the Entity’s operations will cease as a result of an administrative restructure or for any other reason. The Secretary is also responsible for disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the assessment indicates that it is not appropriate.
Auditor’s responsibilities for the audit of the financial statements
My objective is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian National Audit Office Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.
As part of an audit in accordance with the Australian National Audit Office Auditing Standards, I exercise professional judgement and maintain professional scepticism throughout the audit. I also:
ï· identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
122 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control; ï· obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Entity’s internal control; ï· evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Accountable Authority; ï· conclude on the appropriateness of the Accountable Authority’s use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the Entity to cease to continue as a going concern; and ï· evaluate the overall presentation, structure and content of the financial statements, including the
disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
I communicate with the Accountable Authority regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit.
From the matters communicated with the Accountable Authority, I determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. I describe these matters in my auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not be communicated in my report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Australian National Audit Office
Grant Heir
Auditor-General
Canberra
19 September 2019
PA R T 4 F i n a n c i a l S t a t e m e n t s 123
124 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts Statement of Comprehensive Income for the period ended 30 June 2019
5
2019 2018
Notes $'000 $'000
NET COST OF SERVICES
Expenses
Employee benefits 1.1A 73,068 71,021
Suppliers 1.1B 38,753 38,113
Depreciation and amortisation 3.2A 5,227 3,935
Finance costs 1.1C 3 19
Impairment loss allowance on financial instruments 1.1D 7 -
Losses from asset sales 1.1E 129 6,246
Other expenses 1.1F 3,200 5,220
Total expenses 120,387 124,554
Own-Source Income
Own-source revenue
Sales of goods and rendering of services 1.2A 3,625 3,788
Rental income 1.2B 1,991 1,886
Other revenue 1.2C 1,382 1,669
Total own-source revenue 6,998 7,343
Gains
Other gains 1.2D 415 18,675
Total gains 415 18,675
Total own-source income 7,413 26,018
Net cost of services (112,974) (98,536)
Revenue from Government 1.2E 107,763 104,179
Surplus/(Deficit) before income tax on continuing operations (5,211) 5,643
Surplus/(Deficit) after income tax on continuing operations (5,211) 5,643
OTHER COMPREHENSIVE INCOME
Items not subject to subsequent reclassification to net cost of services
Changes in asset revaluation surplus - (392)
Total other comprehensive income/(loss) - (392)
Total comprehensive income/(loss) (5,211) 5,251
The above statement should be read in conjunction with the accompanying notes.
PA R T 4 F i n a n c i a l S t a t e m e n t s 125
Department of Communications and the Arts Statement of Financial Position as at 30 June 2019
6
2019 2018
Notes $'000 $'000
ASSETS
Financial assets
Cash and cash equivalents 3.1A 5,592 4,666
Trade and other receivables 3.1B 19,387 21,195
Total financial assets 24,979 25,861
Non-financial assets
Buildings 3.2A 12,649 13,843
Property, plant and equipment 3.2A 42,618 43,752
Intangibles 3.2A 8,627 6,563
Other non-financial assets 3.2B 4,164 2,370
Total non-financial assets 68,058 66,528
Total assets 93,037 92,389
LIABILITIES
Payables
Suppliers 3.3A 5,523 4,534
Other payables 3.3B 7,492 7,602
Total payables 13,015 12,136
Provisions
Employee provisions 6.1 26,291 25,011
Other provisions 3.4 374 221
Total provisions 26,665 25,232
Total liabilities 39,680 37,368
Net assets 53,357 55,021
EQUITY
Contributed equity 72,849 69,302
Reserves 7,049 7,049
Accumulated deficit (26,541) (21,330)
Total equity 53,357 55,021
The above statement should be read in conjunction with the accompanying notes.
126 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts Statement of Changes in Equity for the period ended 30 June 2019
7
Retained earnings
Asset revaluation
reserve
Contributed equity
Total equity
2019
2018
2019
2018
2019
2018
2019
2018
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
Opening balance
Balance carried forward from previous period
(21,330)
(26,750)
7,049
7,439
69,302
66,423
55,021
47,112
Adjustment for prior year error
-
(221)
-
-
-
-
-
(221)
Adjusted opening balance
(21,330)
(26,971)
7,049
7,439
69,302
66,423
55,021
46,891
Comprehensive income
Surplus (Deficit) for the period
(5,211)
5,643
-
-
-
-
(5,211)
5,643
Other comprehensive income
-
-
-
(392)
-
-
-
(392)
Total comprehensive income
(5,211)
5,643
-
(392)
-
-
(5,211)
5,251
Transactions with owners
Contributions to owners
Returns of capital - repealed appropriation
-
-
-
-
-
(679)
-
(679)
Contributions by owners
Departmental capital budget
-
-
-
-
3,547
3,558
3,547
3,558
Total transactions with owners
-
-
-
-
3,547
2,879
3,547
2,879
Transfers between equity components
-
(2)
-
2
-
-
-
-
Closing balance as at 30 June
(26,541)
(21,330)
7,049
7,049
72,849
69,302
53,357
55,021
The above statement should be read in conjunction with the accompanying notes.
Accounting Policy Equity Injections Amounts appropriated which are designated as ‘equity injections’ for a year (less any formal reductions) and Departmental capital budgets (DCBs) are recognised directly in contributed equity in that year. Restructuring of Administrative Arrangements Net assets assumed from or relinquished to another Government entity under a restructuring of administrative arrangements are adjusted at their book value directly against contributed equity (refer Note 8.2).
PA R T 4 F i n a n c i a l S t a t e m e n t s 127
Department of Communications and the Arts Cash Flow Statement for the period ended 30 June 2019
8
2019 2018
Notes $'000 $'000
OPERATING ACTIVITIES
Cash received
Receipts from Government 115,904 116,145
Sales of goods and rendering of services 5,334 5,665
GST received 3,315 2,831
Other 3,179 2,704
Total cash received 127,732 127,345
Cash used
Employees 71,571 68,419
Suppliers 42,697 40,219
Section 74 receipts transferred to Official Public Account 8,706 11,030
Other expenses 3,200 5,121
Total cash used 126,174 124,789
Net cash from operating activities 1,558 2,556
INVESTING ACTIVITIES
Cash received
Proceeds from sales of property, plant and equipment - 721
Total cash received - 721
Cash used
Purchase of land and buildings 483 1,807
Purchase of property, plant and equipment 545 5,249
Purchase of intangibles 4,023 504
Total cash used 5,051 7,560
Net cash used by investing activities (5,051) (6,839)
FINANCING ACTIVITIES
Cash received
Contributed equity 150 -
Departmental capital budget 4,269 5,551
Total cash received 4,419 5,551
Net cash from financing activities 4,419 5,551
Net increase in cash held 926 1,268
Cash and cash equivalents at the beginning of the reporting period 4,666 3,398
Cash and cash equivalents at the end of the reporting period 3.1A 5,592 4,666
The above statement should be read in conjunction with the accompanying notes.
128 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts Administered Schedule of Comprehensive Income for the period ended 30 June 2019
9
2019 2018
Notes $'000 $'000
NET COST OF SERVICES
Expenses
Suppliers 2.1A 376,205 383,955
Grants 2.1B 249,580 286,702
Depreciation and amortisation 4.2A 10,447 9,822
Impairment loss allowance on financial instruments 2.1C 241 -
Write-down and impairment of other assets 2.1D - 1,582
Payments to corporate Commonwealth entities 2.1E 1,788,930 1,762,898
Other expenses 2.1F 13,625 13,604
Total expenses 2,439,028 2,458,563
Income
Revenue
Non-taxation revenue
Sale of goods and rendering of services 2.2A 3,628 3,702
Interest 2.2B 353,374 71,862
Dividends 2.2C 42,205 78,472
Rental income 2.2D 1,529 1,529
Other revenue 2.2E 942 1,237
Total non-taxation revenue 401,678 156,802
Total revenue 401,678 156,802
Gains
Other gains 2.2F 5,527 6,406
Total gains 5,527 6,406
Total income 407,205 163,208
Net cost of services (2,031,823) (2,295,355)
Deficit (2,031,823) (2,295,355)
OTHER COMPREHENSIVE INCOME
Items not subject to subsequent reclassification to net cost of services
Changes in asset revaluation surplus (1,841) (88)
Items subject to subsequent reclassification to net cost of services
Losses on available for sale financial assets (4,831,145) (4,915,290)
Total other comprehensive loss (4,832,986) (4,915,378)
Total comprehensive loss (6,864,809) (7,210,733)
The above statement should be read in conjunction with the accompanying notes.
PA R T 4 F i n a n c i a l S t a t e m e n t s 129
Department of Communications and the Arts Administered Schedule of Assets and Liabilities as at 30 June 2019
10
2019 2018
Notes $'000 $'000
ASSETS
Financial Assets
Cash and cash equivalents 4.1A 98 47
Trade and other receivables 4.1B 13,114,512 5,616,368
Other investments 4.1C 21,672,171 26,448,077
Other financial assets 4.1D - 19
Total financial assets 34,786,781 32,064,511
Non-financial assets
Buildings 4.2A 55,569 56,377
Property, plant and equipment 4.2A 138,140 148,012
Other non-financial assets 4.2B 2,965 2,917
Total non-financial assets 196,674 207,306
Total assets administered on behalf of Government 34,983,455 32,271,817
LIABILITIES
Payables
Suppliers 4.3A 330,215 340,653
Grants 4.3B 13,255 29,632
Other payables 4.3C 17,206 19,061
Total payables 360,676 389,346
Provisions
Other provisions 4.4A - 1,173
Total provisions - 1,173
Total liabilities administered on behalf of Government 360,676 390,519
Net assets 34,622,779 31,881,298
The above statement should be read in conjunction with the accompanying notes.
130 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts Administered Reconciliation Schedule for the period ended 30 June 2019
11
2019 2018
$'000 $'000
Opening assets less liabilities as at 1 July 31,881,298 29,246,663
Adjustment for change in accounting policies1 (1,600) -
Adjusted opening assets less liabilities 31,879,698 29,246,663
Net cost of contribution by services
Income 407,205 163,208
Expenses
Payments to entities other than corporate Commonwealth entities (650,098) (695,665) Payments to corporate Commonwealth entities (1,788,930) (1,762,898)
Other comprehensive income
Revaluations transferred to (from) reserves (4,831,145) (4,915,290)
Asset revaluation reserve (1,841) (88)
Transfers (to) from the Australian Government
Appropriation transfers from Official Public Account (OPA)
Administered assets and liabilities appropriations
Asset and liabilities appropriations for payments to corporate Commonwealth entities 55,240 2,075,156
Annual appropriations
Payments to entities other than corporate Commonwealth entities 406,080 427,696 Payments to corporate Commonwealth entities 1,788,930 1,762,898
Loans to corporate Commonwealth entities 7,522,000 5,531,000
Special appropriations (unlimited)
Payments to entities other than corporate Commonwealth entities 47 70
Funds provided from related entity to special account 253,887 227,220
Appropriation transfers to OPA
Transfers to OPA (418,294) (178,672)
Closing assets less liabilities as at 30 June 34,622,779 31,881,298
The above statement should be read in conjunction with the accompanying notes.
1Adjustment for changes in accounting policies reflect the adoption of AASB 9 Financial Instruments on 1 July 2018. As permitted by AASB 9, comparative information has not been restated. For more information refer to Note 4.1B.
Accounting Policy
Administered Cash Transfers to and from the Official Public Account
Revenue collected by the entity for use by the Government rather than the entity is administered revenue. Collections are transferred to the Official Public Account (OPA) maintained by the Department of Finance. Conversely, cash is drawn from the OPA to make payments under Parliamentary appropriation on behalf of Government. These transfers to and from the OPA are adjustments to the administered cash held by the entity on behalf of the Government and reported as such in the Administered Cash Flow Statement and in the Administered Reconciliation Schedule.
PA R T 4 F i n a n c i a l S t a t e m e n t s 131
Department of Communications and the Arts Administered Cash Flow Statement for the period ended 30 June 2019
12
2019 2018
Notes $'000 $'000
OPERATING ACTIVITIES
Cash received
Sales of goods and rendering of services 3,554 3,729
Interest 352,442 71,021
Dividends 42,205 78,472
GST received 54,158 56,311
Other 902 1,317
Total cash received 453,261 210,850
Cash used
Grants 287,674 319,424
Suppliers 409,095 402,165
Payments to corporate Commonwealth entities 1,788,930 1,762,898
Other 16,320 14,791
Total cash used 2,502,019 2,499,278
Net cash used by operating activities (2,048,758) (2,288,428)
INVESTING ACTIVITIES
Cash received
Repayments of advances and loans from corporate Commonwealth entities 20,000 20,000
Proceeds from return of equity by corporate Commonwealth entities - 5,000
Total cash received 20,000 25,000
Cash used
Loans to corporate Commonwealth entities 7,522,000 5,531,000
Corporate Commonwealth entity investments 55,240 2,075,156
Purchase of buildings 1,608 1,636
Total cash used 7,578,848 7,607,792
Net cash used by investing activities (7,558,848) (7,582,792)
FINANCING ACTIVITIES
Cash received
Funds provided from related entity for special account 253,887 227,220
Total cash received 253,887 227,220
Net cash from financing activities 253,887 227,220
Net decrease in cash held (9,353,719) (9,644,000)
Cash and cash equivalents at the beginning of period 47 26,711
Cash from Official Public Account
Appropriations 406,080 427,696
Corporate Commonwealth entities appropriations 1,844,170 3,838,054
Loans to corporate Commonwealth entities 7,522,000 5,531,000
Special appropriations 47 70
GST drawdowns from Finance 53,925 55,533
Total cash from official public account 9,826,222 9,852,353
Cash to Official Public Account
Interest received 352,442 71,021
Dividends 42,205 78,472
GST repayments to Finance 54,158 56,345
Other - receipts 23,647 29,179
Total cash to official public account 472,452 235,017
Cash and cash equivalents at the end of the reporting period 4.1 A 98 47
The above statement should be read in conjunction with the accompanying notes.
132 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
13
Overview
Objectives of the Entity
The Department of Communications and the Arts (the Department) is a Government controlled entity. It is a not-for-profit entity. The objective of the Department is to foster an environment in which all Australians benefit from access to diverse communication services and artistic and cultural experiences.
The Department is structured to meet the following outcomes:
Outcome 1: Promote an innovative and competitive communications sector, through policy development, advice and program delivery, so all Australians can realise the full potential of digital technologies and communications services
Outcome 2: Participation in, and access to, Australia’s arts and culture through developing and supporting cultural expression
The continued existence of the Department in its present form and with its present programs is dependent on Government policy and on continuing funding by Parliament for the Department’s administration and programs.
Activities that contribute to these outcomes are classified as either departmental or administered. Departmental activities involve the use of assets, liabilities, income and expenses controlled or incurred by the Department in its own right. Administered activities involve the management or oversight by the Department, on behalf of the Government, of items controlled or incurred by the Government.
The Basis of Preparation
The financial statements are general purpose financial statements and are required by section 42 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).
The financial statements have been prepared in accordance with:
a) Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR); and
b) Australian Accounting Standards and Interpretations - Reduced Disclosure Requirements issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period.
The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. The financial statements are presented in Australian dollars and rounded to the nearest thousand.
Significant Accounting Judgements and Estimates
For the Administered Investment in Australia Post, management estimates are used to determine volume and price growth rates and the weighted average cost of capital that underpin the discounted cash flow valuation at the end of the reporting period. Actual results may differ from these estimates under different assumptions and conditions and may materially affect the financial position reported in future periods. The valuation of NBN Co Limited (NBN Co) is based on the net assets approach. For more information refer to Note 4.1C.
For the Administered loan to NBN Co, management judgement is used to assess if there has been a significant increase in credit risk in accordance with AASB 9 Financial Instruments. The Department assesses exposure to credit risk with reference to the probabilities of default. For more information refer to Note 4.1B.
No other accounting assumptions or estimates have been identified that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next accounting period.
PA R T 4 F i n a n c i a l S t a t e m e n t s 133
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
14
Changes in Accounting Policies
AASB 9 Financial Instruments
AASB 9 sets out requirements for recognising and measuring financial assets and financial liabilities. This standard replaces AASB 139 Financial Instruments: Recognition and Measurement.
AASB 9 introduces an expected credit loss model for impairment of financial assets. The measurement of financial assets now includes a forward looking assessment of the expected credit losses associated with the financial instrument. The Department has reviewed the requirements of the expected credit loss model under AASB 9 and has recognised an impairment allowance on the NBN Co loan on transition to the new standard at 1 July 2018 of $1,600,000. The Department has assessed that there has been no significant increase in credit risk of the NBN Co loan since inception and the probability of default has been assessed as extremely low. In accordance with the transitional provisions in AASB 9, the impairment allowance has been recognised in the current year opening retained earnings with no change to comparatives. For more information refer to Note 4.1B.
The Department performed a review of its current classification and measurement of remaining financial assets and liabilities under the requirements of the new standard. Based on this review, the Department did not identify any other material changes to the classification or measurement of its other financial instruments.
New Accounting Standards
All other new standards, revised standards, interpretations or amending standards that were issued prior to the sign-off date and are applicable to the current reporting period did not have a material effect on the Department's financial statements.
Future Accounting Standards
All new standards, revised standards, interpretations or amending standards that were issued prior to the sign-off date and are applicable to the current reporting period did not have a material effect, and are not expected to have a future material effect on the Department’s financial statements with the exception of AASB 16 Leases.
The Department expects to apply AASB 16 Leases from 1 July 2019. This Standard will require the net present value of payments under most operating leases to be recognised as assets and liabilities. As at 30 June 2019 the Department has a net $65.119 million (GST inclusive) in operating lease commitments over the next eight years.
Taxation
The Department is exempt from all forms of taxation except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST).
Revenues, expenses and assets are recognised net of GST except:
⢠where the amount of GST incurred is not recoverable from the Australian Taxation Office; and
⢠for receivables and payables.
Reporting of Administered Activities Administered revenues, expenses, assets, liabilities and cash flows are disclosed in the administered schedules and related notes.
Except where otherwise stated, administered items are accounted for on the same basis and using the same policies as for departmental items, including the application of Australian Accounting Standards.
134 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
15
Events After the Reporting Period
Departmental
There are no events that occurred after the reporting period that would materially affect the departmental financial statements.
Administered
The Public Governance, Performance and Accountability (Establishing Old Parliament House) Amendment Rules 2019 (Amendment Rules) amend the PGPA OPH Rule to reflect the transfer of responsibility for OPH from the Communications and the Arts portfolio to the Prime Minister and Cabinet portfolio, as reflected in amendments to the Administrative Arrangements Order (AAO) made by the Governor-General on 8 August 2019. The AAO amendments, which establish responsibility for OPH in the Prime Minister and Cabinet portfolio, will take effect from 1 September 2019.
PA R T 4 F i n a n c i a l S t a t e m e n t s 135
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
16
1. Departmental Financial Performance 1.1 Expenses
This section analyses the financial performance of the Department of Communications and the Arts for the year ended 2019.
2019 2018
$'000 $'000
Note 1.1A: Employee Benefits
Wages and salaries 54,060 52,202
Superannuation
Defined contribution plans 5,097 4,943
Defined benefit plans 5,145 5,217
Leave and other entitlements 7,528 6,912
Separation and redundancies 490 728
Other employee expenses 748 1,019
Total employee benefits 73,068 71,021
Accounting Policy
Accounting policies for employee related expenses are contained in the People and Relationships section at Note 6.
Note 1.1B: Suppliers
Goods and services supplied or rendered
Consultants and contractors 10,096 8,827
IT services 8,493 7,489
Office requisites 999 1,158
Property 1,603 2,465
Training 1,259 1,458
Travel 2,592 2,041
Other goods and services 3,877 3,423
Total goods and services supplied or rendered 28,919 26,861
Goods supplied 3,009 3,177
Services rendered 25,910 23,684
Total goods and services supplied or rendered 28,919 26,861
Other suppliers
Workers compensation expenses 191 323
Operating lease rentals 9,643 10,929
Total other suppliers 9,834 11,252
Total suppliers 38,753 38,113
Leasing commitments
The Department in its capacity as lessee for 2 Phillip Law St, Canberra is subject to a 3.5% fixed annual adjustment with a market rent review in April 2023. The lease term expires on 14 December 2027.
The Department in its capacity as lessee for Level 46, 360 Elizabeth Street, Melbourne is subject to a 4% fixed annual adjustment. The lease term expires on 3 April 2022.
The Department in its capacity as lessee for 23-33 Mary Street Level 6, Sydney is subject to a 3% fixed annual adjustment. The lease term expires on 14 May 2021.
The Department in its capacity as lessee for 222 Young Street, Sydney is subject to a 3% fixed annual adjustment. The lease term expires on 31 December 2023.
The Department in its capacity as lessee for 18-24 Down Street, Collingwood is subject to a 3% fixed annual adjustment with a market rent review in January 2025. The lease term expires on 31 December 2026.
136 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
17
2019 2018
$'000 $'000
Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows:
Within 1 year 9,844 9,355
Between 1 to 5 years 38,903 36,304
More than 5 years 35,589 45,313
Total operating lease commitments 84,336 90,972
The above commitment amounts are GST inclusive.
Accounting Policy
Where an asset is acquired by means of a finance lease, the asset is capitalised at the lower of the fair value of the leased property or, if lower, the present value of minimum lease payments at the inception of the contract and a liability is recognised at the same time and for the same amount.
The discount rate used is the interest rate implicit in the lease. Leased assets are amortised over the period of the lease. Lease payments are allocated between the principal component and the interest expense.
Operating lease payments are expensed on a straight-line basis which is representative of the pattern of benefits derived from the leased assets.
Note 1.1C: Finance Costs
Unwinding of discount 3 19
Total finance costs 3 19
Note 1.1D: Impairment Loss Allowance on Financial Instruments
Impairment of financial instruments 7 -
Total impairment loss allowance on financial instruments 7 -
Note 1.1E: Losses from Asset Sales
Heritage and cultural:
Proceeds from sale - (721)
Carrying value of assets sold - 1,126
Property, plant and equipment:
Carrying value of assets disposed 85 543
Building:
Carrying value of assets transferred - 5,212
Intangibles:
Carrying value of assets disposed 44 86
Net losses from asset sales 129 6,246
Note 1.1F: Other Expenses
Contributions to corporate Commonwealth entities 1,270 3,551
Contributions to State and Territory Governments 678 368
Contributions to Non-profit organisations 370 465
Contributions to Administered special account 856 786
Other contributions - 50
Other expenses 26 -
Total other expenses 3,200 5,220
PA R T 4 F i n a n c i a l S t a t e m e n t s 137
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
18
1.2 Own-Source Revenue and Gains
2019 2018
$'000 $'000
Own-Source Revenue
Note 1.2A: Sale of Goods and Rendering of Services
Rendering of services 3,625 3,788
Total sale of goods and rendering of services 3,625 3,788
Accounting Policy Revenue from the sale of goods and rendering of services is recognised when: a) The risks and rewards of ownership have been transferred to the buyer; and b) The entity retains no managerial involvement or effective control over the goods.
The stage of completion of contracts at the reporting date is determined by reference to: a) Surveys of work performed; b) Services performed to date as a percentage of total services to be performed; or c) The proportion that costs incurred to date bear to the estimated total costs of the transaction.
Receivables for goods and services, which have 30 day terms, are recognised at the nominal amounts due less any impairment allowance. Collectability of debts is reviewed at the end of the reporting period. Allowances are made when collectability of the debt is no longer probable.
Note 1.2B: Rental Income
Rental reimbursements for car parking - 10
Rental Rebates 37 39
Operating Lease Rental 1,954 1,837
Total rental income 1,991 1,886
Subleasing rental income commitments
The Department in its capacity as lessor sublet two floors at 2 Phillip Law St, Canberra as of 1 July 2017. The lease is subject to a 3.5% fixed annual adjustment, with a market rent review in April 2023. The lease term expires on 14 December 2027.
Commitments for sublease rental income receivables are as follows:
Within 1 year 1,991 1,924
Between 1 to 5 years 8,688 8,394
More than 5 years 8,538 10,823
Total sublease rental income commitments 19,217 21,141
The above commitment amounts are GST inclusive.
Note 1.2C: Other Revenue
Refunds from prior year payments - 2
Special account contributions 1,151 1,392
Other 231 275
Total other revenue 1,382 1,669
Note 1.2D: Other Gains
Resources received free of charge 415 396
Reversal of provisions - 1,781
Leasehold fitout - 16,498
Total other gains 415 18,675
138 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
19
Accounting Policy
Resources received free of charge
Contributions of assets at no cost of acquisition or for nominal consideration are recognised as gains at their fair value when the asset qualifies for recognition.
2019 2018
$'000 $'000
Note 1.2E: Revenue from Government
Appropriations
Departmental appropriations 107,763 104,179
Total revenue from Government 107,763 104,179
Accounting Policy Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the entity gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned. Appropriations receivable are recognised at their nominal amounts.
PA R T 4 F i n a n c i a l S t a t e m e n t s 139
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
20
2. Income and Expenses Administered on Behalf of Government 2.1 Administered - Expenses This section analyses the activities that the Department of Communications and the Arts does not control but administers on behalf of the Government. Unless otherwise noted, the accounting policies adopted are consistent with those applied for departmental reporting.
2019 2018
$'000 $'000
Note 2.1A: Suppliers
Goods and services supplied or rendered
Consultants and contractors 346,194 361,220
Royalty payments 21,818 22,312
Other goods and services 8,193 423
Total goods and services supplied or rendered 376,205 383,955
Goods supplied 15 33
Services rendered 376,190 383,922
Total goods and services supplied or rendered 376,205 383,955
Note 2.1B: Grants
Public sector
Australian Government entities (related parties) 82,418 85,088
State and Territory Governments 1,710 2,967
Local Governments 2,156 2,029
Private sector
Not-for-profit organisations 91,491 88,968
Commercial entities 71,805 107,650
Total grants 249,580 286,702
Accounting Policy
The entity administers a number of grant and subsidy schemes on behalf of the Government. Grant and subsidy liabilities are recognised to the extent that (i) the services required to be performed by the grantee have been performed or (ii) the grant eligibility criteria have been satisfied, but payments due have not been made. When the Government enters into an agreement to make these grant and subsidy payments but services have not been performed or criteria satisfied, this is considered a commitment.
Note 2.1C: Impairment Loss Allowance on Financial Instruments
Impairment on trade and other receivables 241 -
Total impairment loss allowance on financial instruments 241 -
Note 2.1D: Write-Down and Impairment of Other Assets
Revaluation decrement - Land and Buildings - 1,582
Total write-down and impairment of other assets - 1,582
140 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
21
2019 2018
$'000 $'000
Note 2.1E: Payments to corporate Commonwealth entities
Australian Broadcasting Corporation 1,045,911 1,043,680
Special Broadcasting Service Corporation 281,726 280,058
Australia Council 208,186 209,393
Australian Film, Television and Radio School 22,584 22,683
Australian National Maritime Museum 21,415 20,727
National Film and Sound Archive of Australia 23,932 24,028
National Museum of Australia 45,164 41,444
National Library of Australia 55,557 51,836
National Portrait Gallery of Australia 11,685 10,809
Screen Australia 11,335 11,394
National Gallery of Australia 45,010 30,787
Old Parliament House 16,425 16,059
Total payments to corporate Commonwealth entities 1,788,930 1,762,898
Accounting Policy
Payments to corporate Commonwealth entities from amounts appropriated for that purpose are classified as administered expenses, equity injections or loans of the relevant portfolio department. The appropriation to the department is disclosed under the Funding section - Appropriations at Note 5.
Note 2.1F: Other Expenses
International membership fees 7,219 7,027
Prizes and awards 600 595
Entitlements 4,951 4,577
Contributions 855 1,071
Other expenses - 334
Total other expenses 13,625 13,604
PA R T 4 F i n a n c i a l S t a t e m e n t s 141
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
22
2.2 Administered - Income 2019 2018
$'000 $'000
Revenue
Non-Taxation Revenue
Note 2.2A: Sale of Goods and Rendering of Services
Rendering of services 3,628 3,702
Total sale of goods and rendering of services 3,628 3,702
Accounting Policy
All administered revenues are revenues relating to ordinary activities performed by the entity on behalf of the Australian Government. As such, administered appropriations are not revenues of the individual entity that oversees distribution or expenditure of the funds as directed.
Note 2.2B: Interest
Australian Broadcasting Corporation 1,539 2,132
NBN Co Limited 351,835 69,730
Total interest 353,374 71,862
Note 2.2C: Dividends
Australian Postal Corporation 42,205 78,472
Total dividends 42,205 78,472
Note 2.2D: Rental Income
Indefeasible Rights of Use 1,529 1,529
Total rental income 1,529 1,529
Accounting Policy
Rental Income is recognised over the term of the Indefeasible Rights of Use granted by the Commonwealth to external parties for use of the Administered property, plant and equipment.
Note 2.2E: Other Revenue
Grant refunds 43 378
Contributions 856 786
Other revenue 43 73
Total other revenue 942 1,237
Note 2.2F: Other Gains
Reversal of prior year payables 5,527 6,406
Total other gains 5,527 6,406
142 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
23
3. Departmental Financial Position 3.1 Financial Assets
This section analyses the Department of Communications and the Arts assets used to conduct its operations and the operating
liabilities incurred as a result. Employee related information is disclosed in the People and Relationships section.
2019 2018
$'000 $'000
Note 3.1A: Cash and Cash Equivalents
Cash in special accounts 300 240
Cash on hand or on deposit 844 972
Cash held in the OPA (special accounts) 4,448 3,454
Total cash and cash equivalents 5,592 4,666
Accounting Policy
Cash is recognised at its nominal amount. Cash and cash equivalents includes: a) Cash on hand; b) Demand deposits in bank accounts with an original maturity of 3 months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value; and c) Cash in special accounts.
Note 3.1B: Trade and Other Receivables
Goods and services receivables
Goods and services 834 2,147
Total goods and services receivables 834 2,147
Appropriations receivable
For existing programs 17,458 17,766
Total appropriations receivable 17,458 17,766
Other receivables
GST receivable from the Australian Taxation Office 596 444
Other 515 847
Total other receivables 1,111 1,291
Total trade and other receivables (gross) 19,403 21,204
Less impairment loss allowance
Other receivables (16) (9)
Total impairment loss allowance (16) (9)
Total trade and other receivables (net) 19,387 21,195
All receivables are expected to be recovered in no more than 12 months.
Credit terms for goods and services were within 30 days (2018: 30 days).
Accounting Policy
Financial assets
Trade receivables, loans and other receivables that are held for the purpose of collecting the contractual cash flows where the cash flows are solely payments of principal and interest, that are not provided at below-market interest rates, are subsequently measured at amortised cost using the effective interest method adjusted for any loss allowance.
PA R T 4 F i n a n c i a l S t a t e m e n t s 143
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
24
3.2 Non-Financial Assets Note 3.2A: Reconciliation of the Opening and Closing Balances of Buildings, Property, Plant and Equipment and Intangibles for 2019
Buildings
Heritage and
cultural
Property, Plant and Equipment
Computer software internally developed
Computer software purchased
Total
$’000
$’000
$’000
$’000
$’000
$’000
As at 1 July 2018
Gross book value
15,199
36,103
8,397
14,134
967
74,800
Accumulated depreciation, amortisation and impairment
(1,356)
(369)
(379)
(7,777)
(761)
(10,642)
Total as at 1 July 2018
13,843
35,734
8,018
6,357
206
64,158
Additions
Purchase
733
468
77
-
-
1,278
Internally developed
-
-
-
4,023
-
4,023
Impairments recognised in net cost of services
-
-
-
-
-
-
Revaluations recognised in net cost of services
-
-
-
-
-
-
Reclassifications
(90)
(40)
(67)
-
(12)
(209)
Depreciation and amortisation
(1,837)
(140)
(1,347)
(1,841)
(62)
(5,227)
Disposals
From disposal of obsolete items
-
-
(85)
(39)
(5)
(129)
Total as at 30 June 2019
12,649
36,022
6,596
8,500
127
63,894
Total as at 30 June 2019 represented by
Gross book value
15,842
36,531
8,272
16,340
942
77,927
Accumulated depreciation, amortisation and impairment
(3,193)
(509)
(1,676)
(7,840)
(815)
(14,033)
Total as at 30 June 2019
12,649
36,022
6,596
8,500
127
63,894
Assets under construction are included in the value of property, plant and equipment of nil (2018: $548,002) and computer software internally develop
ed of $4,141,712
(2018: $1,506,274).
All revaluations are conducted in accordance with the revaluation policy stated at Note 7.4. An independent valuer conducted the revaluations as at 30 June 2019.
There were no revaluation decrements recognised in 2019. Revaluation decrements in 2018 of $358,656 for leasehold improvements and $24,653 for property, plant and equipment were debited from the asset revaluation reserve and included in the equity section of the Statement of Financial Position.
As at 30 June 2019 no intangible assets were found to be impaired.
144 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
25
Contractual commitments for the acquisition of property, plant, equipment and intangible assets for 2019
Capital Commitments
Within 1 year Between 1
to 5 years More than
5 years
$’000 $’000 $’000
Computer software internally developed 3,393 - -
Total capital commitments 3,393 - -
Contractual commitments for the acquisition of property, plant, equipment and intangible assets for 2018
Capital Commitments
Within 1 year Between 1
to 5 years More than
5 years
$’000 $’000 $’000
Buildings 156 - -
Property, plant and equipment 68 - -
Computer software internally developed 300 - -
Total capital commitments 524 - -
The above commitment amounts are GST inclusive.
PA R T 4 F i n a n c i a l S t a t e m e n t s 145
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
26
Accounting Policy
Assets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken. Financial assets are initially measured at their fair value plus transaction costs where appropriate.
Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and income at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements. In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor’s accounts immediately prior to the restructuring.
Property, Plant and Equipment
Asset Recognition Threshold
Purchases of property, plant and equipment are recognised initially at cost in the Statement of Financial Position, except for purchases costing less than $2,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items that are significant in total).
The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to ‘make-good’ provisions in property leases taken up by the Department where an obligation exists to restore the property to its original condition. These costs are included in the value of the Department’s leasehold improvements with a corresponding provision for the ‘make-good’ recognised.
Revaluations
Fair values for each class of asset are determined as shown below:
Asset Class Fair Value measured at:
Land and buildings Depreciated replacement cost
Property, plant and equipment Market selling price or depreciated replacement cost
Heritage and cultural asset Active market
Following initial recognition at cost, property, plant and equipment are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not differ materially from the assets’ fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.
Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reversed a previous revaluation decrement of the same asset class that was previously recognised in the surplus/deficit. Revaluation decrements for a class of assets are recognised directly in the surplus/deficit, except to the extent that they reverse a previous revaluation increment for that class.
Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset restated to the revalued amount.
Assets purchased during the financial year are excluded from asset revaluation as they represent fair value.
Depreciation
Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the Department using, in all cases, the straight-line method of depreciation. Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate.
146 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Buildings
Property, Plant and Equipment
Heritage and Cultural
Impairment
Derecognition
PA R T 4 F i n a n c i a l S t a t e m e n t s 147
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
28
3.3 Payables 2019 2018
$'000 $'000
Note 3.3A: Suppliers
Trade creditors and accruals 3,724 3,794
Operating lease rentals 1,799 740
Total suppliers 5,523 4,534
The majority of suppliers engaged had 30 day payment terms.
Suppliers are expected to be settled in no more than 12 months.
Note 3.3B: Other Payables
Salaries and wages 457 569
Superannuation 77 81
Employee transfers 1,658 1,657
Lease incentive 2,633 2,999
Prepayments received/unearned income 2,111 2,030
Contributions 106 176
Other 450 90
Total other payables 7,492 7,602
3.4 Other Provisions
Provision for make-good1 Total
$’000 $’000
As at 1 July 2018 221 221
Additional provisions made 250 250
Amounts used (100) (100)
Unwinding of discount or change in discount rate 3 3
Total as at 30 June 2019 374 374
1The Department currently has two (2018: two) agreements for the leasing of premises that have provisions requiring the Department to restore the premises to their original condition at the conclusion of the lease. The Department has made a provision to reflect the present value of this obligation.
148 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
29
4. Assets and Liabilities Administered on Behalf of Government 4.1 Administered - Financial Assets This section analyses assets used to conduct operations and the operating liabilities incurred that therefore the Department of Communications and the Arts does not control but administers on behalf of the Government. Unless otherwise noted, the accounting policies adopted are consistent with those applied for departmental reporting.
2019 2018
$'000 $'000
Note 4.1A: Cash and Cash Equivalents
Cash held in the OPA (special accounts) 98 47
Total cash and cash equivalents 98 47
Note 4.1B: Trade and Other Receivables
Advances and loans
Loans to corporate Commonwealth entities
Australian Broadcasting Corporation1 29,619 49,021
NBN Co Limited2 13,053,335 5,531,000
Total advances and loans 13,082,954 5,580,021
Other receivables
GST receivable from the Australian Taxation Office 33,158 36,083
Grants receivable 264 264
Other - 1
Total other receivables 33,422 36,348
Total trade and other receivables (gross) 13,116,376 5,616,369
Less impairment loss allowance
Loans to corporate Commonwealth entities3 (1,600) -
Grants receivable (264) (1)
Total impairment loss allowance (1,864) (1)
Total trade and other receivables (net) 13,114,512 5,616,368
1Loans to Australian Broadcasting Corporation were made under financial assistance legislation. No security is required. Interest rates are fixed. Principal and interest are repaid annually in arrears. Effective interest rates average 1.95% per annum (2018: 1.88% per annum).
2The Government has provided a loan to NBN Co Limited (NBN Co) on commercial terms of up to $19.5 billion with drawings available on a monthly basis. The loan was established in December 2016 and must be repaid in full by 30 June 2024. The loan has a fixed interest rate of 3.96% per annum with interest payable monthly over the life of the facility.
3The Department has assessed the loan to NBN Co on transition to AASB 9 Financial Instruments. In accordance with the requirements of AASB 9, the Department has determined that there has not been a significant increase in credit risk of the loan since inception and the probability of default has been assessed as extremely low. The impairment allowance has been calculated with reference to the probability of default. The allowance recognised by the Department is not indicative of an identified loss event for the NBN Co loan.
PA R T 4 F i n a n c i a l S t a t e m e n t s 149
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
30
2019 2018
$'000 $'000
Note 4.1C: Other Investments
Corporate Commonwealth entities:
Australian Broadcasting Corporation 1,071,656 1,033,352
Australian Postal Corporation 2,224,649 2,582,229
Special Broadcasting Service Corporation 222,626 215,544
Australia Council 14,725 14,340
Australian Film, Television and Radio School 11,105 11,122
Australian National Maritime Museum 263,063 256,668
National Film and Sound Archive of Australia 353,384 292,051
National Gallery of Australia 6,333,026 6,314,864
National Library of Australia 1,695,104 1,691,970
National Museum of Australia 459,315 471,444
National Portrait Gallery of Australia 146,170 143,798
Screen Australia 17,749 17,743
Old Parliament House 112,629 93,924
12,925,201 13,139,049
Commonwealth companies:
NBN Co Limited1 8,682,301 13,247,377
Bundanon Trust 59,196 58,729
Creative Partnerships Australia 5,473 2,922
8,746,970 13,309,028
Total other investments 21,672,171 26,448,077
For full details of the corporate Commonwealth entities and the Commonwealth companies please refer to each entity's individual financial statements.
1The Government’s loan to NBN Co is disclosed in Note 4.1B.
Accounting Policy
Administered investments in subsidiaries, joint ventures and associates are not consolidated because their consolidation is relevant only at the Whole of Australian Government level.
In accordance with AASB 13 Fair Value Measurement, the following techniques are used to value Administered Investments: (a) Discounted Cash Flows - this method needs to be considered when an entity invests in another entity that generates significant non-government cash inflows; and (b) Net Assets - this method needs to be considered when an entity invests in another entity that does not generate significant non-government cash inflows.
A review of all administered investments is performed on an annual basis to ensure the appropriate valuation method is used.
Administered investments, other than those held for sale, are classified as 'financial assets of fair value through other comprehensive income’ and are measured at their fair value as at 30 June 2019. Apart from Australian Postal Corporation, fair value has been taken to be the Australian Government's proportional interest in the net assets of the entities as at the end of reporting period.
150 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
31
Australian Postal Corporation’s fair value estimates are based on a Discounted Cash Flow valuation calculated using cash flow forecasts extracted from the Australia Post Corporate Plan 2019-20 to 2022-23. The forecasts use management estimates to determine volume and price growth rates, and the weighted average cost of capital. Actual results may differ from these estimates under different assumptions and conditions and may materially affect the financial position reported in future periods.
In accordance with AASB 9 Financial Instruments and AASB 13 Fair Value Measurement, the Department has determined that the appropriate valuation method for the investment in NBN Co as at 30 June 2019 is the net assets approach. NBN Co is still in the build phase of construction and its cash flows are predominately from government.
2019 2018
$'000 $'000
Note 4.1D: Other Financial Assets
Assets forfeited under the Protection of Movable Cultural Heritage Act 19961 - 19
Total other financial assets - 19
1Items forfeited to the Commonwealth under subsection 14(1) of the Protection of Movable Cultural Heritage Act 1996.
PA R T 4 F i n a n c i a l S t a t e m e n t s 151
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
32
4.2 Administered - Non-Financial Assets
Note 4.2A: Reconciliation of the Opening and Closing Balances of Buildings, Property, Plant and Equipment for 2019
Buildings
Property plant and equipment Total
$’000 $’000 $’000
As at 1 July 2018
Gross book value 56,377 148,012 204,389
Accumulated depreciation, amortisation and impairment - - -
Total as at 1 July 2018 56,377 148,012 204,389
Additions
Purchase 1,608 - 1,608
Revaluations recognised in other comprehensive income - (1,841) (1,841)
Revaluations recognised in comprehensive income - - -
Depreciation and amortisation (2,416) (8,031) (10,447)
Total as at 30 June 2019 55,569 138,140 193,709
Total as at 30 June 2019 represented by
Gross book value 57,985 138,140 196,125
Accumulated depreciation, amortisation and impairment (2,416) - (2,416)
Total as at 30 June 2019 55,569 138,140 193,709
No indicators of impairment were found for buildings or property, plant and equipment.
No buildings or property, plant or equipment is expected to be sold or disposed of within the next 12 months.
All revaluations were conducted in accordance with the revaluation policy stated at Note 7.5. An independent valuer conducted the revaluations as at 30 June 2019 for property, plant and equipment and buildings.
Revaluation decrements of $1,840,540 for property, plant and equipment (2018: $87,961) were debited to the asset revaluation reserve and included in the Statement of Other Comprehensive Income. There were no building decrements in 2019 (2018: $1,582,048).
Contractual commitments for the acquisition of property, plant, equipment assets for 2019
Within 1 year
Between 1 to 5 years
More than 5 years
$’000 $’000 $’000
Buildings 1,763 3,555 -
Total capital commitments 1,763 3,555 -
Contractual commitments for the acquisition of property, plant, equipment assets for 2018
Within 1 year
Between 1 to 5 years
More than 5 years
$’000 $’000 $’000
Buildings 1,769 5,319 -
Total capital commitments 1,769 5,319 -
The above commitment amounts are GST inclusive.
152 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
33
2019 2018
$'000 $'000
Note 4.2B: Other Non-Financial Assets
Other prepayments 2,965 2,917
Total other non-financial assets 2,965 2,917
4.3 Administered - Payables 2019 2018
$'000 $'000
Note 4.3A: Suppliers
Trade creditors and accruals 330,215 340,653
Total suppliers 330,215 340,653
Settlement is usually made within 30 days.
Note 4.3B: Grants
Australian Government entities 431 323
Local Governments 166 53
Non-profit organisations 1,397 197
Commercial entities 11,261 29,059
Total grants 13,255 29,632
All grant payables are expected to be settled in no more than 12 months. Settlement is usually made according to the terms and conditions of each grant within 30 days of performance or eligibility.
Note 4.3C: Other Payables
GST payable to the Official Public Account 5,410 5,643
Lease income received in advance1 11,347 12,876
Classification income received in advance 449 523
Forfeited assets2 - 19
Total other payables 17,206 19,061
1Lease income received in advance relates to the indefeasible rights of use (IRUs) issued by the Commonwealth in relation to network infrastructure assets. As part of the arrangement for the construction of assets and the issue of IRUs, the Commonwealth has provided a lease incentive to the contractor in the form of a reduction of lease payments that would otherwise be payable to the Commonwealth for the IRUs. The lease incentive was recognised as a lease prepayment and lease income received in advance. 2Items forfeited to the Commonwealth under subsection 14(1) of the Protection of Movable Cultural Heritage Act 1996.
4.4 Administered - Provisions Note 4.4A: Other Provisions
Provision for grants Total
$'000 $'000
As at 1st July 2018 1,173 1,173
New provisions made - -
Amounts used (1,173) (1,173)
Amounts reversed - -
Total as at 30 June 2019 - -
PA R T 4 F i n a n c i a l S t a t e m e n t s 153
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
34
5. Funding 5.1 Appropriations This section identifies the Department of Communications and the Arts funding structure. Note 5.1A: Annual Appropriations ('Recoverable GST exclusive')
Annual Appropriations for 2019
Annual
appropriation
Adjustments to appropriation
1
Total appropriation
Appropriation applied in 2019 (current and prior
years)
Variance
2
$'000
$'000
$'000
$'000
$'000
Departmental
Ordinary annual services
107,763
8,706
116,469
115,904
565
Capital budget
3
3,547
-
3,547
4,269
(722)
Other services
Equity injections
-
-
-
150
(150)
Total departmental
111,310
8,706
120,016
120,323
(307)
Administered
Ordinary annual services
Administered items
417,246
-
417,246
404,472
12,774
Capital budget
3
1,608
-
1,608
1,608
-
Payments to corporate Commonwealth entities
1,788,930
-
1,788,930
1,788,930
-
Other services
Administered assets and liabilities
5,055,869
-
5,055,869
7,170,499
(2,114,630)
Payments to corporate Commonwealth entities
55,240
-
55,240
55,240
-
Total administered
7,318,893
-
7,318,893
9,420,749
(2,101,856)
1 Departmental adjustments are PGPA Act Section 74 receipts. 2 Departmental variances relate to funds required to cover accruals and prior year funds expended in the current year. Administered variances relate to funds required to cover accruals, and the assets and liabilities variance relates to funding required by NBN Co in 2018-19 due to revised expenditure forecasts that reflect changes in the deployment profile and other payments.
3 Departmental and Administered Capital Budgets are appropriated through Appropriation Acts (No.1,3,5). They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.
154 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
35
Annual appropriations for 2018
Annual
appropriation
1
Adjustments to appropriation
2
Total appropriation
Appropriation applied in 2018 (current and prior
years)
Variance
3
$'000
$'000
$'000
$'000
$'000
Departmental
Ordinary annual services
104,179
11,030
115,209
116,145
(936)
Capital budget
4
3,558
-
3,558
5,551
(1,993)
Other services
Equity injections
-
-
-
-
-
Total departmental
107,737
11,030
118,767
121,696
(2,929)
Administered
Ordinary annual services
Administered items
450,885
-
450,885
426,060
24,825
Capital budget
4
1,636
-
1,636
1,636
-
Payments to corporate Commonwealth entities
1,762,898
-
1,762,898
1,762,898
-
Other services
Administered assets and liabilities
9,158,817
-
9,158,817
7,495,825
1,662,992
Payments to corporate Commonwealth entities
40,601
-
40,601
40,601
-
Total administered
11,414,837
-
11,414,837
9,727,020
1,687,817
1 Administered Appropriation Act (No. 1) 2017-18 of $14,035,000 was withheld (Section 51 of the PGPA Act) on 26 June 2018 and quarantined for administrative purposes. 2 Departmental adjustments are PGPA Act Section 74 receipts. 3 Departmental variances relate to prior year funds expended in the current year. Administered variances relate to funds required to cover accruals, and the assets and liabilities variance relates to funding not required by NBN Co in 2017-18 due to revised expenditure forecasts that reflect changes in the deployment profile and other payments. 4
Departmental and Administered Capital Budgets are appropriated through Appropriation Acts (No.1,3,5). They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.
PA R T 4 F i n a n c i a l S t a t e m e n t s 155
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
36
Note 5.1B: Unspent Annual Appropriations ('Recoverable GST exclusive') 2019 2018
$'000 $'000
Departmental
Cash on hand or on deposit 844 972
Appropriation Act (No.1) 2018-2019 (Capital Budget) 454 -
Appropriation Act (No.1) 2018-2019 15,453 -
Appropriation Act (No.3) 2018-2019 1,551 -
Appropriation Act (No.1) 2017-2018 - 15,571
Supply Act (No.1) 2017-2018 (Capital Budget - DCB) - 1,177
Appropriation Act (No.3) 2016-2017 - 868
Appropriation Act (No.2) 2016-2017 - 150
Total Departmental 18,302 18,738
Administered
Appropriation Act (No.1) 2018-2019 44,031 -
Appropriation Act (No.3) 2018-2019 13,115 -
Appropriation Act (No.2) 2018-2019 1,582,916 -
Appropriation Act (No.1) 2017-20181 14,196 49,813
Appropriation Act (No.3) 2017-2018 2,041 2,041
Appropriation Act (No.2) 2017-2018 - 3,252,992
Appropriation Act (No.1) 2016-20171 4,172 12,927
Appropriation Act (No.3) 2016-2017 928 928
Appropriation Act (No.2) 2016-2017 - 444,555
Appropriation Act (No.1) 2015-20162 - 545
Appropriation Act (No.3) 2015-20162 - 697
Total Administered 1,661,399 3,764,498
1Administered appropriations have been permanently withheld under section 51 of the PGPA Act amounting to $36,411,000 (2016-17) and $14,035,000 (2017-18) for unspent appropriation no longer required.
2Administered appropriations for 2015-16 were repealed on 1 July 2018.
Note 5.1C: Special Appropriations ('Recoverable GST exclusive')
Authority
Appropriation applied
2019 2018
$'000 $'000
Telstra Corporation Act 1991, section 8BA(3). Nature: Administered (Unlimited Amount) - -
Public Governance, Performance and Accountability Act 2013 , section 77. Nature: Administered (Refund Provisions) 47 70
Classification (Publications, Films and Computer Games) Act 1995. Nature: Administered - -
Total special appropriations applied 47 70
156 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
37
5.2 Special Accounts Note 5.2A: Special Accounts ('Recoverable GST exclusive')
Art Rental Special Account 2016
1
Public Interest
Telecommunications
Services
Special Account
2
Cultural
Special Account
3
Indigenous Repatriation Special Account 2016
4
National Cultural
Heritage
Special Account
5
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
Balance brought forward from previous period
725
986
44
26,711
380
203
2,589
1,542
3
-
Increases
Departmental
Appropriation credited to special account
-
1,350
4,046
4,007
167
135
660
800
-
-
Receipts
5,552
4,192
-
-
543
610
782
992
-
-
Total departmental
5,552
5,542
4,046
4,007
710
745
1,442
1,792
-
-
Administered
Contribution received
-
-
856
786
-
-
-
-
497
500
Telecommunication Industry Levy receipts
-
-
253,887
227,220
-
-
-
-
-
-
Appropriation credited to special account
-
-
95,954
95,993
-
-
-
-
-
-
Total administered
-
-
350,697
323,999
-
-
-
-
497
500
Total increases
5,552
5,542
354,743
328,006
710
745
1,442
1,792
497
500
Available for payments
6,277
6,528
354,787
354,717
1,090
948
4,031
3,334
500
500
Decreases
Departmental
Payments made
(5,092)
(5,803)
(3,190)
(3,221)
(356)
(568)
(1,202)
(745)
-
-
Contribution made
-
-
(856)
(786)
-
-
-
-
-
-
Total departmental
(5,092)
(5,803)
(4,046)
(4,007)
(356)
(568)
(1,202)
(745)
-
-
Administered
Payments made
-
-
(350,673)
(350,666)
-
-
-
-
(470)
(497)
Total administered
-
-
(350,673)
(350,666)
-
-
-
-
(470)
(497)
Total decreases
(5,092)
(5,803)
(354,719)
(354,673)
(356)
(568)
(1,202)
(745)
(470)
(497)
Total balance carried to the next period
1,185
725
68
44
734
380
2,829
2,589
30
3
Balance represented by:
Cash held in entity bank accounts
300
240
-
-
-
-
-
-
-
-
Cash held in the Official Public Account
885
485
68
44
734
380
2,829
2,589
30
3
Total balance carried to the next period
1,185
725
68
44
734
380
2,829
2,589
30
3
PA R T 4 F i n a n c i a l S t a t e m e n t s 157
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
38
1Appropriation: Public Governance, Performance and Accountability Act 2013, section 78. Establishing Instrument: PGPA Act Determination (Art Rental Special Account 2016). Purpose: Amounts may be debited from the special account to: a. acquire, deaccession, lease, promote, develop, exhibit, lend, conserve and undertake any other activities in relation to managing an art rental collection for the Commonwealth; b. activities that are incidental to the purposes mentioned in paragraph (a); c. to reduce the balance of the special account without making a real or notional payment; and d. to repay, as required by law, amounts that have been credited to the special account.
2Appropriation: Public Governance, Performance and Accountability Act 2013, section 80. Establishing Instrument: Telecommunications (Consumer Protection and Service Standards) Act 1999, Division 5, section 37. Purpose: Support the delivery of Universal Service Obligation, National Relay Service and other public interest telecommunications services for all Australians. The Australian Communications and Media Authority collects a levy imposed on carriers under the Telecommunications (Industry Levy) Act 2012 and the Telecommunications (Consumer Protection and Service Standards) Act 1999. These levy receipts are credited to the special account, and along with Government funding, are used to pay contractors and grant recipients and to contribute to administrative costs.
3Appropriation: Public Governance, Performance and Accountability Act 2013, section 78. Establishing Instrument: Financial Management and Accountability (Establishment of Cultural Special Account) Determination 2011/18. Purpose: Supporting the performance or administration of cultural activities.
4Appropriation: Public Governance, Performance and Accountability Act 2013 section 78. Establishing Instrument: PGPA Act Determination (Indigenous Repatriation Special Account 2016). Purpose: Developing and conducting projects, programs and strategies associated with the repatriation of Indigenous ancestral remains and secret sacred objects.
5Appropriation: Public Governance, Performance and Accountability Act 2013, section 80. Establishing Instrument: Protection of Moveable Cultural Heritage Act 1986, section 25. Purpose: Amounts standing to the credit of the National Cultural Heritage Account may be expended for the purpose of facilitating the acquisition of the Australian protected objects for display or self-keeping. This account is non-interest bearing and the balance is held in the Official Public Account.
The Department has a BAF Communications Portfolio Special Account as a part of the Nations Building Funds Act 2008. The account was established under section 80 of the Public Governance, Performance and Accountability Act 2013. Purpose: To make payments in relation to the creation or development of communications infrastructure; and eligible national broadband network matters. For the year ended 30 June 2019, the account had a nil balance and there were no transactions debited or credited to it during the current or prior reporting period.
158 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
39
5.3 Regulatory Charging Summary 2019 2018
$'000 $'000
Amounts applied
Departmental
Annual appropriations 6,223 6,424
Own source revenue 32 26
Administered
Annual appropriations - -
Total amounts applied 6,255 6,450
Expenses
Departmental 6,255 6,450
Administered - -
Total expenses 6,255 6,450
External revenue
Departmental 32 26
Administered 3,628 3,702
Total external revenue 3,660 3,728
Amounts written off
Departmental - -
Administered - -
Total amounts written off - -
Regulatory charging activities:
Classification Fees: Before every film, computer game and certain publications can be legally made available to the Australian public by means of sale, exhibition or commercial distribution they must be classified (with limited exceptions). A valid classification application is to be accompanied with the prescribed fee before any classification decision can be made. The Classification (Publications, Films and Computer Games) Act 1995 and the Classification (Publications, Films and Computer Games) Regulations 2005 are the enabling legislation.
Cost Recovery Implementation Statement for the above activity is available at http://www.classification.gov.au/About/Pages/Legislation.aspx.
PA R T 4 F i n a n c i a l S t a t e m e n t s 159
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
40
6. People and Relationships 6.1 Employee Provisions
This section describes a range of employment and post employment benefits provided to our people and our relationships with
other key people.
2019 2018
$'000 $'000
6.1: Employee Provisions
Leave 25,975 25,011
Separations and redundancies 316 -
Total employee provisions 26,291 25,011
Accounting policy
Liabilities for short-term employee benefits and termination benefits expected within twelve months of the end of reporting period are measured at their nominal amounts.
Other long-term employee benefits are measured as the net total of the present value of the defined benefit obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.
Leave
The liability for employee benefits includes provision for annual leave and long service leave. The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will be applied at the time the leave is taken, including the entity’s employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.
The liability for long service leave has been determined by using the Department of Finance’s Short Hand Method as at 30 June 2019, as outlined in the Financial Reporting Rule. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.
Separation and Redundancy
Provision is made for separation and redundancy benefit payments. The entity recognises a provision for termination when it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.
Superannuation
The entity's staff are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS), the PSS accumulation plan (PSSap), or other superannuation funds held outside the Australian Government. The CSS and PSS are defined benefit schemes for the Australian Government. The PSSap is a defined contribution scheme.
The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course. This liability is reported in the Department of Finance’s administered schedules and notes.
The entity makes employer contributions to the employees' defined benefit superannuation scheme at rates determined by an actuary to be sufficient to meet the current cost to the Government. The entity accounts for the contributions as if they were contributions to defined contribution plans.
The liability for superannuation recognised as at 30 June represents outstanding contributions.
160 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
41
6.2 Key Management Personnel Remuneration
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the Department, directly or indirectly. During 2017-18 the Secretary formed the Secretary’s Business Meeting (SBM) with the first meeting held on 24 November 2017. For the 2018-19 financial year, the Department has determined the key management personnel to be permanent members of the SBM, being the Secretary, Deputy Secretaries and Chief Operating Officer and anyone who has acted in one of those positions and attended a SBM during the acting periods.
In the previous year the Department had determined the key management personnel to be the members of the Executive Leadership Team (ELT), comprising the Secretary, Deputy Secretaries, First Assistant Secretaries and the Chief Risk Officer. The total key management personnel remuneration expense for the Executive Leadership Team in 2018 was $4,269,000. However, for comparative purposes the 2018 figures have been re-stated based on the SBM.
Key management personnel remuneration is reported in the table below:
2019 2018
$'000 $'000
Short-term employee benefits 1,688 1,827
Post-employment benefits 260 296
Other long-term employee benefits 38 176
Termination benefits - 221
Total key management personnel remuneration expenses1 1,986 2,520
The total number of key management personnel included in the above table is six individuals, being four individuals who held the position for the full year and two who acted in the position for part of the year (2018: nine individuals, being two who held the position for the full year and seven who held the position for part of the year, including acting arrangements).
There were no termination benefits paid in 2019.
1The above key management personnel remuneration excludes the remuneration and other benefits of the Cabinet Ministers, Portfolio Ministers, Assistant Ministers and Presiding Officers. The ministers’ remuneration and other benefits are set by the Remuneration Tribunal and are not paid by the Department.
6.3 Related Party Disclosures
Related party relationships:
The Department is an Australian Government controlled entity. Related parties to this Department are Key Management Personnel including the Portfolio Minister and Executive, and other Australian Government entities.
Transactions with related parties:
Given the breadth of Government activities, related parties may transact with the government sector in the same capacity as ordinary citizens. Such transactions include the payment or refund of taxes, receipt of a Medicare rebate or higher education loans. These transactions have not been separately disclosed in this note.
Giving consideration to relationships with related entities, and transactions entered into during the reporting period by the Department, it has been determined that there are no related party transactions to be separately disclosed.
PA R T 4 F i n a n c i a l S t a t e m e n t s 161
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
42
7. Managing Uncertainties 7.1 Contingent Assets and Liabilities This section analyses how the Department of Communications and the Arts manages financial risks within its operating
environment.
7.1A: Departmental Contingent Assets and Liabilities
Quantifiable Contingencies There are no significant quantifiable contingencies as at 30 June 2019 (2018: nil).
Unquantifiable Contingencies There are no significant unquantifiable contingencies as at 30 June 2019 (2018: nil).
Significant Remote Contingencies Operating Leases and Car Parking Licences
The Commonwealth indemnifies third parties against loss in relation to operating leases for accommodation, storage and some car parking. The Commonwealth also indemnifies some third parties against loss in relation to car parking facilities acquired under car parking licence agreements. As at 30 June 2019, no claims have been made.
Westpac Banking Corporation
The Commonwealth indemnifies Westpac Banking Corporation against loss reasonably incurred in relation to Departmental banking functions. In June 2013, the Department entered into a new banking contract with Westpac that provided for an indemnity capped at $50 million per occurrence. The previous contract provided for an
indemnity capped at $25 million per occurrence. As at 30 June 2019, no claims have been made (2018: nil).
Accounting Policy
Contingent liabilities and contingent assets are not recognised in the Statement of Financial Position but are reported in the notes. They may arise from uncertainty as to the existence of a liability or asset or represent an asset or liability in respect of which the amount cannot be reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain and contingent liabilities are disclosed when settlement is greater than remote.
Indemnities
The maximum amounts payable under the indemnities given is disclosed above. At the time of completion of the financial statements, there was no reason to believe that the indemnities would be called upon, and no recognition of any liability was therefore required.
162 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
43
7.1B: Administered - Contingent Assets and Liabilities
Quantifiable Administered Contingencies
As at 30 June 2019, the Australian Government did not have any quantifiable contingencies (2018: nil).
Unquantifiable Administered Contingencies NBN Co Limited (NBN Co) Board Members Insolvency Indemnity The Australian Government has provided Directors of NBN Co with an indemnity against liability should the Government fail to meet its funding obligations to NBN Co. The liabilities covered by this indemnity would be no greater than those covered by the NBN Co Equity Funding Agreement, with the exception of any legal expenses incurred by individual Directors arising from this indemnity.
Significant Remote Administered Contingencies Telstra Financial Guarantee The Australian Government has provided to Telstra Corporation Limited (Telstra) a Guarantee in respect of NBN Co financial obligations under the Definitive Agreements. The Agreements were amended on 14 December 2014. The Guarantee was not amended at that time and it continues in force in accordance with its terms in respect of the amended Definitive Agreements. The liabilities under the Definitive Agreements between Telstra and NBN Co arise progressively during the roll-out of the National Broadband Network as Telstra’s infrastructure is accessed and Telstra’s customers are disconnected from its copper and Hybrid Fibre Coaxial cable networks. The Australian Government is only liable in the event NBN Co does not pay an amount when due under the Definitive Agreements. As at 30 June 2019, NBN Co had generated liabilities covered by the Guarantee estimated at $9.4 billion. The Guarantee will terminate when NBN Co achieves specified credit ratings for a period of two continuous years and either: ⢠the company is capitalised by the Commonwealth to the agreed amount; or ⢠the Communications Minister declares, under the National Broadband Network Companies Act 2011, that, in
his or her opinion, the National Broadband Network should be treated as built and fully operational.
Optus Financial Guarantee The Australian Government has provided a Guarantee in respect of the NBN Co financial obligations to Optus Networks Pty Ltd, Optus Internet Pty Ltd, Optus Vision Media Pty Ltd and SingTel Optus Pty Ltd (collectively, Optus) under the Optus HFC Subscriber Agreement (the Agreement). An amended version of the Agreement came into effect on 22 January 2019. The Guarantee continues to apply to that Agreement. The Agreement extends for the period of the National Broadband Network roll-out in Optus Hybrid Fibre Coaxial areas. The Australian Government is only liable in the event NBN Co does not pay an amount when due under the Optus Agreement. As at 30 June 2019, NBN Co had generated liabilities covered by the Optus Agreement, which are estimated at an amount lower than $197.0 million. There is a low risk that a claim would be made under the Guarantee. The Guarantee will terminate in 2021.
Equity Funding Agreement The Australian Government has entered into an Equity Funding Agreement with NBN Co to provide $29.5 billion equity funding. Although this Agreement ended on 30 June 2019, the Australian Government retains obligations to meet NBN Co’s costs arising from a termination of the roll-out. As at 30 June 2019, NBN Co’s termination liabilities were estimated at $21.3 billion.
PA R T 4 F i n a n c i a l S t a t e m e n t s 163
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
44
7.2 Financial Instruments 2019 2018
$'000 $'000
Note 7.2A: Categories of Financial Instruments
Financial Assets under AASB 139
Loans and receivables
Cash and cash equivalents 4,666
Goods and services receivable 2,147
Other receivables 847
Total loans and receivables 7,660
Financial Assets under AASB 9
Financial assets at amortised cost
Cash and cash equivalents 5,592
Goods and services receivable 834
Other receivables 515
Total financial assets at amortised cost 6,941
Total financial assets 6,941 7,660
Financial Liabilities
Financial liabilities measured at amortised cost
Suppliers 3,724 3,794
Other payables 2,214 1,923
Total financial liabilities measured at amortised cost 5,938 5,717
Total financial liabilities 5,938 5,717
Classification of financial assets on the date of initial application of AASB 9
Financial assets class Note
AASB 139 original classification
AASB 9 new classification
AASB 139 carrying amount at 1 July
2018
AASB 9 carrying amount at 1 July
2018
$'000 $'000
Cash and cash equivalents 3.1A Loans and receivable Amortised Cost 4,666 4,666
Goods and services receivable 3.1B Loans and receivable Amortised Cost 2,147 2,147
Other receivables
3.1B
Loans and receivable Amortised Cost 847 847
Total financial assets 7,660 7,660
Reconciliation of carrying amounts of financial assets on the date of initial application of AASB 9
AASB 139
carrying amount at 1 July 2018 Reclassification Re-measurement
AASB 9 carrying amount at 1 July
2018
$'000 $'000 $'000 $'000
Financial assets at amortised cost
Cash and cash equivalents 4,666 - - 4,666
Goods and services receivable 2,147 - - 2,147
Other receivables 847 - - 847
Total amortised cost 7,660 - - 7,660
164 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
45
2019 2018
$'000 $'000
Note 7.2B: Net Gains or Losses on Financial Assets
Financial assets at amortised cost
Impairment (7) -
Net loss on financial assets at amortised cost (7) -
Net loss on financial assets (7) -
The Department had no gains or losses on financial liabilities in either the current or prior year.
PA R T 4 F i n a n c i a l S t a t e m e n t s 165
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
46
Accounting Policy
Financial assets
With the implementation of AASB 9 Financial Instruments for the first time in 2019; the entity classifies its financial assets in the following categories:
a) financial assets at fair value through profit or loss;
b) financial assets at fair value through other comprehensive income; and
c) financial assets measured at amortised cost.
The classification depends on both the entity’s business model for managing the financial assets and contractual cash flow characteristics at the time of initial recognition. Financial assets are recognised when the entity becomes a party to the contract and, as a consequence, has a legal right to receive or a legal obligation to pay cash and derecognised when the contractual rights to the cash flows from the financial asset expire or are transferred upon a trade date.
Comparatives have not been restated on initial application.
Financial Assets at Amortised Cost Financial assets included in this category need to meet two criteria: 1. the financial asset is held in order to collect the contractual cash flows; and 2. the cash flows are solely payments of principal and interest (SPPI) on the principal outstanding amount.
Amortised cost is determined using the effective interest method.
Effective Interest Method
Income is recognised on an effective interest rate basis for financial assets that are recognised at amortised cost.
Financial Assets at Fair Value Through Other Comprehensive Income (FVOCI) Financial assets measured at fair value through other comprehensive income are held with the objective of both collecting contractual cash flows and selling the financial assets and the cash flows meet the SPPI test.
Any gains or losses as a result of fair value measurement or the recognition of an impairment loss allowance is recognised in other comprehensive income.
Financial Assets at Fair Value Through Profit or Loss (FVTPL) Financial assets are classified as financial assets at fair value through profit or loss where the financial assets either doesn’t meet the criteria of financial assets held at amortised cost or at FVOCI (i.e. mandatorily held at FVTPL) or may be designated.
Financial assets at FVTPL are stated at fair value, with any resultant gain or loss recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest earned on the financial asset.
Impairment of Financial Assets
Financial assets are assessed for impairment at the end of each reporting period based on expected credit losses, using the general approach which measures the loss allowance based on an amount equal to lifetime expected credit losses where risk has significantly increased, or an amount equal to 12-month expected credit losses if the risk has not increased.
The simplified approach for trade, contract and lease receivables is used. This approach always measures the loss allowance as the amount equal to the lifetime expected credit losses.
A write-off constitutes a derecognition event where the write-off directly reduces the gross carrying amount of the financial asset.
Financial Liabilities
Financial liabilities are classified as either financial liabilities at ‘fair value through profit or loss’ or other financial liabilities.
Financial liabilities are recognised and derecognised upon ‘trade date’.
Financial Liabilities at Fair Value Through Profit or Loss
Financial liabilities at fair value through profit or loss are initially measured at fair value. Subsequent fair value adjustments are recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability.
166 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
47
Financial Liabilities at Amortised Cost
Financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. These liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective interest basis.
Supplier and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).
All payables are expected to be settled within 12 months except where indicated.
PA R T 4 F i n a n c i a l S t a t e m e n t s 167
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
48
7.3 Administered - Financial Instruments 2019 2018
$'000 $'000
Note 7.3A: Categories of Financial Instruments
Financial Assets under AASB 139
Loans and receivables
Cash on hand or on deposit 47
Loans to corporate Commonwealth entities
Australian Broadcasting Corporation 49,021
NBN Co Limited 5,531,000
Grants receivable 264
Other 1
Total loans and receivables 5,580,333
Available for sale financial assets
Other investments 26,448,077
Total available for sale financial assets 26,448,077
Financial Assets under AASB 9
Financial assets at amortised cost
Cash on hand or on deposit 98
Loans to corporate Commonwealth entities
Australian Broadcasting Corporation 29,619
NBN Co Limited 13,053,335
Grants receivable 264
Total financial assets at amortised cost 13,083,316
Financial assets at fair value through other comprehensive income
Other investments 21,672,171
Total financial assets at fair value through other comprehensive income 21,672,171
Total financial assets 34,755,487 32,028,410
Financial Liabilities
Financial liabilities measured at amortised cost
Suppliers 330,215 340,653
Grants payable 13,255 29,632
Total financial liabilities measured at amortised cost 343,470 370,285
Total financial liabilities 343,470 370,285
168 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
49
Classification of financial assets on the date of initial application of AASB 9
Financial asset class
Notes
AASB 139 original classification
AASB 9 new classification
AASB 139 carrying amount at 1 July
2018
AASB 9 carrying amount at 1 July
2018
$'000 $'000
Cash on hand or on deposit 4.1A Loans and receivable Amortised Cost 47 47
Loans to corporate Commonwealth entities
Australian Broadcasting Corporation 4.1B Loans and
receivable Amortised Cost 49,021 49,021
NBN Co Limited
4.1B
Loans and receivable Amortised Cost 5,531,000 5,529,400
Grants receivable
4.1B
Loans and receivable Amortised Cost 264 264
Other
4.1B
Loans and receivable Amortised Cost 1 1
Other investments 4.1C
Available-for-sales financial assets FVOCI 26,448,077 26,448,077
Total financial assets 32,028,410 32,026,810
Reconciliation of carrying amounts of financial assets on the date of initial application of AASB 9
AASB 139 carrying amount at 1 July 2018 Reclassification Re-measurement
AASB 9 carrying amount at 1 July 2018
$'000 $'000 $'000 $'000
Financial assets at amortised cost
Cash on hand or on deposit 47 - - 47
Loans to corporate Commonwealth entities
Australian Broadcasting Corporation 49,021 - - 49,021
NBN Co Limited1 5,531,000 - (1,600) 5,529,400
Grants receivable 264 - - 264
Other 1 - - 1
Total amortised cost 5,580,333 - (1,600) 5,578,733
Financial assets at fair value through other comprehensive income
Other investments 26,448,077 - - 26,448,077
Total fair value through other comprehensive income 26,448,077 - - 26,448,077
1The Department has reviewed the requirements of the expected credit loss model under AASB 9 and has recognised an impairment allowance on the NBN Co loan on transition to the new standard at 1 July 2018 of $1,600,000. The Department has assessed that there has been no significant increase in credit risk of the NBN Co loan since inception and the probability of default is extremely low. In accordance with the transitional provisions in AASB 9, the impairment allowance has been recognised in the current year opening retained earnings with no change to comparatives.
PA R T 4 F i n a n c i a l S t a t e m e n t s 169
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
50
2019 2018
$'000 $'000
Note 7.3B: Net Gains and Losses on Financial Assets
Financial assets at amortised cost
Interest revenue 353,374 71,862
Australia Post dividend 42,205 78,472
Impairment (241) -
Net gains on financial assets at amortised cost 395,338 150,334
Financial assets at fair value through other comprehensive income
Losses recognised in equity (4,831,145) (4,915,290)
Net losses on financial assets at fair value through other comprehensive income (4,831,145) (4,915,290)
Net losses on financial assets (4,435,807) (4,764,956)
Note 7.3C: Fair Value of Financial Instruments
Carrying Fair Carrying Fair
amount value amount value
2019 2019 2018 2018
$'000 $'000 $'000 $'000
Financial Assets
Cash and cash equivalents 98 98 47 47
Loans to corporate Commonwealth entities
Australian Broadcasting Corporation 29,619 30,295 49,021 49,669
NBN Co Limited 13,051,735 13,051,735 5,531,000 5,531,000
Other investments 21,672,171 21,672,171 26,448,077 26,448,077
Total financial assets 34,753,623 34,754,299 32,028,145 32,028,793
Financial Liabilities
Suppliers 330,215 330,215 340,653 340,653
Grants 13,255 13,255 29,632 29,632
Total financial liabilities 343,470 343,470 370,285 370,285
170 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
51
Note 7.3D: Credit Risk
The administered activities of the Department were not exposed to a high level of credit risk as the majority of financial assets are trade receivables, loans to Government controlled and funded entities and investment in Portfolio Agencies. The maximum exposure to credit risk is the risk that arises from potential default of a debtor. The carrying amount of financial assets, net of impairment losses, reported in the Administered Schedule of Assets and Liabilities represents the maximum exposure to credit risk as $13,081 million (2018: $5,580 million).
Grants receivable - Credit risk is managed by undertaking background and credit checks prior to allowing a debtor relationship. In addition, there are policies and procedures that guide debt recovery techniques that are to be applied. The Department has assessed the risk of the default on payment of grants receivable and has allocated $264,000 to an impairment allowance in 2019 (2018: nil). The Department has reviewed the historic impairment provision for grants receivable in accordance with AASB 9 Financial Instruments and has determined that there is no material adjustment on adoption of the new standard.
Loans to Government controlled and funded entities - the loan to NBN Co is monitored between origination and maturity through a series of oversight arrangements that assess the short and long-term financial performance of NBN Co. This considers changes in the borrower’s earnings, expenditure and market position. Our assessment of the security for the loan recognises that NBN Co is a wholly-owned Government Business Enterprise.
Note 7.3E: Liquidity Risk
The Administered financial liabilities are trade creditors and grants payable. The exposure to liquidity risk is based on the notion that the Commonwealth will encounter difficulty in meeting its obligations associated with Administered financial liabilities. This is highly unlikely due to appropriation funding and mechanisms, internal policies and procedures that are currently in place.
All financial liabilities are payable within one year.
Note 7.3F: Market Risk
Currency risk Other than Administered Investments the Commonwealth holds basic financial instruments that do not expose the Commonwealth to certain market risk. The Department’s Administered activities are not exposed to ‘currency risk’ and ‘other price risk’.
Interest rate risk ‘Interest rate risk’ refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The only interest bearing item in the closing Administered Schedule of Assets and Liabilities is ‘loans receivable’. These items have fixed interest and will, therefore, not fluctuate due to changes in the market interest rate. As the loans to corporate Commonwealth entities are fixed interest only loans there is no inherent interest rate risk.
Other price risk The Department’s administered activities are not exposed to ‘Other Price Risk’. The Administered investments are not traded on the Australian Stock Exchange. The Department does not hold any other financial instruments that would be exposed to price risk.
PA R T 4 F i n a n c i a l S t a t e m e n t s 171
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
52
7.4 Fair Value Measurement The following table provides an analysis of assets and liabilities that are measured at fair value. The remaining assets and liabilities disclosed in the Statement of Financial Position do not apply to the fair value hierarchy.
The different levels of fair value hierarchy are defined below:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Department can access at measurement date.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
Note 7.4A: Fair Value Measurement
Fair value measurements at the end of the reporting period
2019 2018
$'000 $'000
Non-financial assets1
Heritage and cultural4 36,022 35,734
Plant and equipment2 6,596 8,018
Buildings2 12,649 13,843
Total non-financial assets 55,267 57,595
Accounting Policy
A desktop materiality review of the artwork was conducted as at 30 June 2019 and the outcomes were relied upon to assess the fair value measurement for this asset class.
The Department engaged the service of Jones Lang LaSalle (JLL) to conduct an asset materiality review of all non-financial assets with the exception of Artbank’s artwork collection (Heritage and Cultural asset class) as at 30 June 2019. An annual assessment is undertaken to determine whether the carrying amount of the assets is materially different from the fair value. Comprehensive valuations are carried out at least once every three years with the previous comprehensive valuation conducted as at 30 June 2018. JLL has provided written assurance to the Department that the models developed are in compliance with AASB 13 Fair Value Measurement.
The methods utilised to determine and substantiate the unobservable inputs are derived and evaluated as follows:
Physical Depreciation and Obsolescence - Assets that do not transact with enough frequency or transparency to develop objective opinions of value from observable market evidence have been measured utilising the Depreciated Replacement Cost approach. Under the Depreciated Replacement Cost approach the estimated cost to replace the asset is calculated and then adjusted to take into account the physical depreciation and obsolescence. Physical depreciation and obsolescence has been determined based on professional judgement regarding physical, economic and external obsolescence factors relevant to the asset under consideration. For all Leasehold Improvement assets, the consumed economic benefit/asset obsolescence deduction is determined based on the term of the associated lease.
The Department’s policy is to recognise transfers into and transfers out of fair value hierarchy levels at the end of the reporting period.
1The Department's assets are held for operational purposes and not held for the purposes of deriving a profit. The current use of all non-financial assets is considered their highest and best use. 2No non-financial assets were measured at fair value on a non-recurring basis as at 30 June 2019 (2018: nil).
3The remaining assets and liabilities reported by the Department are not measured at fair value in the Statement of Financial Position. 4Heritage and cultural assets relate to the Artbank collection.
172 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
53
7.5 Administered - Fair Value Measurements The following table provides an analysis of assets and liabilities that are measured at fair value. The remaining assets and liabilities disclosed in the Statement of Financial Position do not apply to the fair value hierarchy.
The different levels of fair value hierarchy are defined below:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Department can access at measurement date. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: Unobservable inputs for the asset or liability.
Accounting Policy
Fair values for Regional Backbone Blackspots Program (RBBP) network infrastructure assets under property, plant and equipment are determined based on the depreciated replacement cost method. The method is calculated for each individual part of the asset using a price per unit adjusted for inflation, a quantity of each component and a location factor before being aggregated to form the values for each identified component of the assets. Components include fibre optic cable, Control Environment Vault Shelters and Backbone Point of Interconnect cabinets. There has been no change in the valuation technique for the RBBP network infrastructure assets.
The Department engaged the service of Jones Lang LaSalle (JLL) to conduct an asset materiality review of all non-financial assets (excluding the RBBP) at 30 June 2019, which includes the Administered National Institute of Dramatic Arts Building. An annual assessment is undertaken to determine whether the carrying amount of the assets is materially different from the fair value. Comprehensive valuations are carried out at least once every three years. JLL has provided written assurance to the Department that the models developed are in compliance with AASB 13 Fair Value Measurement. If a particular asset class experiences significant or volatile changes in fair value (i.e. where indicators suggest that the value of the class has changed materially since the previous reporting period), that class is subject to specific valuation in the reporting period, where practicable, regardless of the timing of the last specific valuation.
The methods utilised to determine and substantiate the unobservable inputs are derived and evaluated as follows:
Physical Depreciation and Obsolescence - Assets that do not transact with enough frequency or transparency to develop objective opinions of value from observable market evidence have been measured utilising the Depreciated Replacement Cost approach. Under the Depreciated Replacement Cost approach the estimated cost to replace the asset is calculated and then adjusted to take into account the physical depreciation and obsolescence. Physical depreciation and obsolescence has been determined based on professional judgement regarding physical, economic and external obsolescence factors relevant to the asset under consideration. For all Leasehold Improvement assets, the consumed economic benefit / asset obsolescence deduction is determined based on the term of the associated lease.
The Department's policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
PA R T 4 F i n a n c i a l S t a t e m e n t s 173
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
54
Note 7.5A: Fair Value Measurements
Fair value measurements at the end of the reporting period
1
2019
2018
Category (Level 1,2 or 3)
2
Valuation Technique(s) and Inputs Used
$'000
$'000
Financial assets
5
Loans to corporate Commonwealth entities:
Australian Broadcasting Corporation
30,295
49,669
2
Discounted cash flow (DCF): Future principal, interest cash flows and market rate interest.
NBN Co Limited
13,051,735
5,531,000
2
Amortised cost basis using the effective interest rate method.
Other investments
6
Australian Broadcasting Corporation
1,071,656
1,033,352
3
Net asset balance
Special Broadcasting Service Corporation
222,626
215,544
3
Net asset balance
Australia Council
14,725
14,340
3
Net asset balance
Australian Film,Television and Radio School
11,105
11,122
3
Net asset balance
Australian National Maritime Museum
263,063
256,668
3
Net asset balance
National Film and Sound Archive of Australia
353,384
292,051
3
Net asset balance
National Gallery of Australia
6,333,026
6,314,864
3
Net asset balance
National Library of Australia
1,695,104
1,691,970
3
Net asset balance
National Museum of Australia
459,315
471,444
3
Net asset balance
National Portrait Gallery of Australia
146,170
143,798
3
Net asset balance
Screen Australia
17,749
17,743
3
Net asset balance
Old Parliament House
112,629
93,924
3
Net asset balance
Bundanon Trust
59,196
58,729
3
Net asset balance
Creative Partnerships Australia
5,473
2,922
3
Net asset balance
NBN Co Limited
8,682,301
13,247,377
3
Administered investment valuation in NBN Co Limited is based on its net assets balance with the property, plant and equipment adjusted for fair value and the discounting of leave and superannuation liabilities adjusted by applying the Government bond rate.
Investment in Australian Postal Corporation
3
2,224,649
2,582,229
3
Administered investment valuation is based on discounted cash flow (DCF): Volume and price growth rates, and Weighted Average Cost of Capital (WACC).
Volume & Price Growth Rates Range
10% an increase of approximately $251 million
(10)% a decrease of approximately $231 million
Weighted Average Cost of Capital Range
1.25% a decrease of approximately $489 million
(0.11)% an increase of approximately $51 million
Total financial assets
34,754,201
32,028,746
Non-financial assets
2
174 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
55
Buildings
55,569
56,377
3
Depreciated Replacement Cost (DRC): Current Cost per square metre of floor area relevant to the location asset. Physical depreciation and obsolescence has been determined based on the term of the associated nominal lease.
Property, plant and equipment
138,140
148,012
3
Depreciated Replacement Cost (DRC)
Replacement cost per unit for the following asset components:
Asset Component
Range ($'000)
(Weighted Average)
- Fibre optic cable (per km)
$5.33 - $12.71 ($6.57)
- Controlled environment vault shelters (per section)
$271.90 - $528.13 ($324.46)
- Transmission Equipment (per section)
$538.61 - $869.21 ($615.65)
- Bpol cabinets (per cabinet)
$15.23 - $119.24 ($92.44)
Other Inputs
Input
Range (weighted average)
- Remaining useful life (in years)
7 - 23 (19)
- Inflation factor
0.98 - 1.26 (1.15)
- Installation cost (per section of network)
$492.73 - $1,117.20 ($562.87)
- Installation cost (per cabinet)
$35.98 - $154.05 ($110.30)
Sensitivity of the fair value measurement to change in unobservable inputs. The estimated fair value would increase (decrease) if: ⢠the replacement cost per unit for the asset components was higher (lower); ⢠the rate of inflation was higher (lower); ⢠the useful life of the asset components was longer (shorter); and/or ⢠the installation cost per component was higher (lower).
Total non-financial assets
193,709
204,389
Total assets
34,947,910
32,233,135
1
The Department did not measure any non-financial assets at fair value on a non-recurring basis as at 30 June. 2Significant Level 3 inputs utilised by the Department are derived and evaluated as follows; assets that do not transact with e
nough frequency or transparency to develop objective opinions
of value from observable market evidence have been measured utilising the cost (Depreciated Replacement Cost or DRC) approach. Under the DRC approach the estimated cost to replace the asset is calculated and then adjusted to take into account its consumed economic benefit/asset obsolescence (accum
ulated depreciation). Consumed economic benefit/asset
obsolescence has been determined based on professional judgement regarding physical, economic and external obsolescence factors relevant to the asset under consideration. 3The Discounted Cash Flow (DCF) method, is appropriate when it results in a measurement that is more representative of fair val
ue. Per AASB13.B10 when using an income approach,
fair value reflects current market expectations about the future amounts. 4Significant unobservable inputs only. Not applicable for assets or liabilities in the Level 2 category. The weighted average i
s determined by assessing the fair value measurement as a
proportion of the total fair value for the class against the total useful life of each asset. 5The current use of all non-financial assets is considered their highest and best use. 6Administered investments valuations are based on the audited net asset balance with the exception of the Australian Postal Cor
poration and NBN Co Limited (NBN Co), refer Note 4.1C.
ï· Australia Post is based on the discounted cash flow methodology. ï· NBN Co is based on the audited net asset balance adjusted for fair value of property, plant and equipment and discounting lea
ve and superannuation liabilities adjusted by applying
the Government bond rate. The impact of these adjustments was an increase of $1.345 billion at 30 June 2019 (2018: $1.035 bill
ion) to the $7.337 billion reported in
NBN Co's financial statements. NBN Co engaged an independent reviewer to assess the fair value of property, plant and equipment in June 2019 and in June 2018.
PA R T 4 F i n a n c i a l S t a t e m e n t s 175
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
56
Note 7.5B: Reconciliation for Recurring Level 3 Fair Value Measurements Recurring Level 3 fair value measurements - reconciliation for assets
Financial assets
Non-financial assets
Administered Investments
Building
Property, plant and
equipment
Total
2019 $'000
2018 $'000
2019 $'000
2018 $'000
2019 $'000
2018 $'000
2019 $'000
2018 $'000
As at 1 July
1
26,448,077
29,293,211
56,377
58,110
148,012
156,135
26,652,466
29,507,456
Revaluation (decrements)/increments recognised in other comprehensive income
(4,831,145)
(4,915,290)
-
-
(1,841)
(88)
(4,832,986)
(4,915,378)
Equity injections
55,240
2,075,156
1,608
1,636
-
-
56,848
2,076,792
Returns to the Consolidated Revenue Fund (CRF)
-
(5,000)
-
-
-
-
-
(5,000)
Depreciation
-
-
(2,416)
(1,787)
(8,031)
(8,035)
(10,447)
(9,822)
Other
2
(1)
-
-
(1,582)
-
-
(1)
(1,582)
Total as at 30 June
3
21,672,171
26,448,077
55,569
56,377
138,140
148,012
21,865,880
26,652,466
1 Opening balance as determined in accordance with AASB 13. 2 Included in the other movement is rounding for administered investments and for buildings is a revaluation decrement in 2018 (2019: nil). 3 Additional details in Note 4.2A.
176 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
57
8. Other Information 8.1 Aggregate Assets and Liabilities
2019 2018
$'000 $'000
Note 8.1A: Aggregate Assets and Liabilities
Assets expected to be recovered in:
No more than 12 months 27,656 27,634
More than 12 months 65,381 64,755
Total assets 93,037 92,389
Liabilities expected to be settled in:
No more than 12 months 16,968 16,262
More than 12 months 22,712 21,106
Total liabilities 39,680 37,368
Note 8.1B: Administered - Aggregate Assets and Liabilities
Assets expected to be recovered in:
No more than 12 months 56,445 59,318
More than 12 months 34,927,010 32,212,499
Total assets 34,983,455 32,271,817
Liabilities expected to be settled in:
No more than 12 months 351,913 380,227
More than 12 months 8,763 10,292
Total liabilities 360,676 390,519
8.2 Restructuring
There were no Departmental or Administered restructures for 2019 (2018: nil).
PA R T 4 F i n a n c i a l S t a t e m e n t s 177
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
58
8.3 Budgetary Reports and Explanations of Major Variances
The following tables provide a comparison of the original budget as presented in the 2018-19 Portfolio Budget Statements to the 2018-19 final financial outcome as presented in accordance with Australian Accounting Standards for the Department. The Budget is not audited and does not reflect additional estimates provided in the 2018-19 Portfolio Additional Estimates Statements. Explanations are provided for significant variances between actual results and the original budget, being the Portfolio Budget Statements. Significant variances are those relevant to the performance of the Department and are typically those greater than $5 million (Departmental), $20 million (Administered) and greater than five percent.
8.3A: Departmental Budgetary Reports
Statement of Comprehensive Income
for the period ended 30 June 2019
Budget estimate
Actual Original Variance
2019 2019 2019
$'000 $'000 $'000
NET COST OF SERVICES
Expenses
Employee benefits 73,068 72,733 335
Suppliers1 38,753 36,571 2,182
Depreciation and amortisation 5,227 4,691 536
Finance costs 3 66 (63)
Impairment loss allowance on financial instruments 7 - 7
Losses from sale of assets 129 - 129
Other expenses 3,200 2,912 288
Total expenses 120,387 116,973 3,414
Own-Source Income
Own-source revenue
Sales of goods and rendering of services 3,625 3,495 130
Rental income2 1,991 - 1,991
Other revenue 1,382 2,087 (705)
Total own-source revenue 6,998 5,582 1,416
Gains
Other gains 415 488 (73)
Total gains 415 488 (73)
Total own-source income 7,413 6,070 1,343
Net cost of services (112,974) (110,903) (2,071)
Revenue from Government 107,763 106,212 1,551
Surplus (Deficit) before income tax on continuing operations (5,211) (4,691) (520)
Surplus (Deficit) after income tax on continuing operations (5,211) (4,691) (520)
OTHER COMPREHENSIVE INCOME
Items not subject to subsequent reclassification to net cost of services
Changes in asset revaluation surplus - - -
Total other comprehensive income - - -
Total comprehensive income (loss) (5,211) (4,691) (520)
The above statement should be read in conjunction with note 8.3B
178 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
59
Statement of Financial Position
as at 30 June 2019
Budget Estimate
Actual Original Variance
2019 2019 2019
$'000 $'000 $'000
ASSETS
Financial Assets
Cash and cash equivalents 5,592 3,398 2,194
Trade and other receivables 19,387 19,163 224
Total financial assets 24,979 22,561 2,418
Non-Financial Assets
Buildings3 12,649 2,645 10,004
Property, plant and equipment3 6,596 15,251 (8,655)
Intangibles4 8,627 5,969 2,658
Heritage and cultural assets 36,022 36,126 (104)
Other non-financial assets 4,164 1,586 2,578
Total non-financial assets 68,058 61,577 6,481
Total assets 93,037 84,138 8,899
LIABILITIES
Payables
Suppliers 5,523 2,882 2,641
Other payables5 7,492 2,440 5,052
Total payables 13,015 5,322 7,693
Provisions
Employee provisions 26,291 25,869 422
Other provisions 374 342 32
Total provisions 26,665 26,211 454
Total liabilities 39,680 31,533 8,147
Net assets 53,357 52,605 752
EQUITY
Contributed equity 72,849 73,528 (679)
Reserves 7,049 7,439 (390)
Accumulated deficit (26,541) (28,362) 1,821
Total equity 53,357 52,605 752
The above statement should be read in conjunction with note 8.3B
PA R T 4 F i n a n c i a l S t a t e m e n t s 179
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
60
Statement of Changes in Equity for the period ended 30 June 2019
Retained Earnings
Asset revaluation reserve
Contributed equity/capital
Total Equity
Budget Estimate
Budget Estimate
Budget Estimate
Budget Estimate
Actual
Original
Variance
Actual
Original
Variance
Actual
Original
Variance
Actual
Original
Variance
2019
2019
2019
2019
2019
2019
2019
2019
2019
2019
2019
2019
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
Opening balance
Balance carried forward from previous period
(21,330)
(23,671)
2,341
7,049
7,439
(390)
69,302
69,981
(679)
55,021 53,749
1,272
Adjusted opening balance
(21,330)
(23,671)
2,341
7,049
7,439
(390)
69,302
69,981
(679)
55,021 53,749
1,272
Comprehensive income
Surplus/(Deficit) for the period
(5,211)
(4,691)
(520)
-
-
-
-
-
-
(5,211) (4,691)
(520)
Total comprehensive income
(5,211)
(4,691)
(520)
-
-
-
-
-
-
(5,211) (4,691)
(520)
Transactions with owners
Contributions by owners
Departmental capital budget
-
-
-
-
-
-
3,547
3,547
-
3,547 3,547
-
Total transactions with owners
- - - - - - - 3,547 3,547 - 3,547 3,547
-
Transfers between equity components
-
-
-
-
-
-
-
-
-
- -
-
Closing balance as at 30 June
(26,541)
(28,362)
1,821
7,049
7,439
(390)
72,849
73,528
(679)
53,357
52,605
752
The above statement should be read in conjunction with note 8.3B
180 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
61
Cash Flow Statement
for the period ended 30 June 2019
Budget Estimate
Actual Original Variance
2019 2019 2019
$'000 $'000 $'000
OPERATING ACTIVITIES
Cash received
Receipts from Government6 115,904 106,475 9,429
Sales of goods and rendering of services2 5,334 514 4,820
GST received 3,315 - 3,315
Other 3,179 5,005 (1,826)
Total cash received 127,732 111,994 15,738
Cash used
Employees 71,571 72,360 (789)
Suppliers1 42,697 36,722 5,975
Section 74 receipts transferred to Official Public Account6 8,706 - 8,706
Other expenses 3,200 2,912 288
Total cash used 126,174 111,994 14,180
Net cash from operating activities 1,558 - 1,558
INVESTING ACTIVITIES
Cash used
Purchase of land and buildings 483 - 483
Purchase of property, plant and equipment7 545 3,547 (3,002)
Purchase of intangibles4 4,023 - 4,023
Total cash used 5,051 3,547 1,504
Net cash used by investing activities (5,051) (3,547) (1,504)
FINANCING ACTIVITIES
Cash received
Contributed equity 150 - 150
Departmental capital budget 4,269 3,547 722
Total cash received 4,419 3,547 872
Net cash from financing activities 4,419 3,547 872
Net increase in cash held 926 - 926
Cash and cash equivalents at the beginning of the reporting period 4,666 3,398 1,268
Cash and cash equivalents at the end of the reporting period 5,592 3,398 2,194
The above statement should be read in conjunction with note 8.3B
PA R T 4 F i n a n c i a l S t a t e m e n t s 181
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
62
8.3B: Departmental Major Budget Variances
Explanations of major variances
1Supplier expenditure was higher than budgeted due to increases in departmental projects.
2The budget relating to rental income in the Statement of Comprehensive Income and the Cash Flow Statement is included in ‘other revenue’.
3During 2017-18 the Department relocated from Sydney Avenue in Barton to the Nishi Building on Philip Law Street in Acton. The fitout assets in the Nishi Building were originally recognised as ‘property, plant and equipment’ in the budget estimates, the balances will be moved to ‘buildings’ in the next budget update.
4The Department’s Information Technology standard operating environment was upgraded during 2018-19 which is reflected in an increase in the ‘intangibles’ balance.
5The balance reported as ‘other payables’ mainly reflects the recognition of lease incentives and rental income.
6Receipts from government is higher than budgeted due to the inclusion of the PGPA Section 74 receipts transferred to the Official Public Account.
7The fitout of the Nishi building required less modification to meet the needs of the Department than expected, resulting in lower than budgeted expenditure on property, plant and equipment.
182 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
63
8.3C: Administered Budgetary Reports
Administered Schedule of Comprehensive income
for the period ended 30 June 2019
Budget estimate
Actual Original Variance
2019 2019 2019
$'000 $'000 $'000
NET COST OF SERVICES
Expenses
Suppliers1 376,205 355,350 20,855
Grants2 249,580 272,404 (22,824)
Depreciation and amortisation 10,447 9,671 776
Impairment loss allowance on financial instruments 241 - 241
Payments to corporate Commonwealth entities 1,788,930 1,774,530 14,400
Subsidies3 - 570,188 (570,188)
Other expenses 13,625 7,146 6,479
Total expenses 2,439,028 2,989,289 (550,261)
Income
Revenue
Non-taxation revenue
Sale of goods and rendering of services 3,628 3,309 319
Interest4 353,374 401,836 (48,462)
Dividends5 42,205 71,800 (29,595)
Rental income 1,529 1,529 -
Other revenue 942 389 553
Total non-taxation revenue 401,678 478,863 (77,185)
Total revenue 401,678 478,863 (77,185)
Gains
Other gains 5,527 - 5,527
Total gains 5,527 - 5,527
Total income 407,205 478,863 (71,658)
Net cost of services (2,031,823) (2,510,426) 478,603
Deficit (2,031,823) (2,510,426) 478,603
OTHER COMPREHENSIVE INCOME
Items not subject to subsequent reclassification to net cost of services
Changes in asset revaluation surplus (1,841) - (1,841)
Items subject to subsequent reclassification to net cost of services
Losses on available for sale financial assets6 (4,831,145) - (4,831,145)
Total other comprehensive income (4,832,986) - (4,832,986)
Total comprehensive loss (6,864,809) (2,510,426) (4,354,383)
The above statement should be read in conjunction with note 8.3D
PA R T 4 F i n a n c i a l S t a t e m e n t s 183
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
64
Administered Schedule of Assets and Liabilities
as at 30 June 2019
Budget estimate
Actual Original Variance
2019 2019 2019
$'000 $'000 $'000
ASSETS
Financial Assets
Cash and cash equivalents7 98 26,711 (26,613)
Trade and other receivables4 13,114,512 14,754,100 (1,639,588)
Other investments6 21,672,171 25,271,723 (3,599,552)
Total financial assets 34,786,781 40,052,534 (5,265,753)
Non-financial assets
Buildings 55,569 58,080 (2,511)
Property, plant and equipment 138,140 140,069 (1,929)
Other non-financial assets 2,965 6,288 (3,323)
Total non-financial assets 196,674 204,437 (7,763)
Total assets administered on behalf of Government 34,983,455 40,256,971 (5,273,516)
LIABILITIES
Payables
Suppliers 330,215 335,350 (5,135)
Grants2 13,255 39,452 (26,197)
Subsidies3 - 563,989 (563,989)
Other payables 17,206 18,317 (1,111)
Total payables 360,676 957,108 (596,432)
Total liabilities administered on behalf of Government 360,676 957,108 (596,432)
Net assets 34,622,779 39,299,863 (4,677,084)
The above statement should be read in conjunction with note 8.3D
8.3D: Administered Major Budget Variances
Explanation of major variances
1Supplier expenses increased in 2018-19 mainly as a result of the advertising costs relating to the online safety campaign and increased activity under the Public Interest Telecommunications program.
2The lower than budgeted grants expense mainly relates to the Mobile Black Spots Program. Some base stations that were budgeted for completion in 2018-19 will be completed in 2019-20 and the related grant milestones payments will now be made in 2019-20.
3The 2018-19 Budget estimates reflected the planned commencement of the Regional Broadband Scheme in 2018-19. The Budget was updated during the year to reflect the commencement of the program being deferred to 2019-20.
4During 2018-19 NBN Co accessed less of the loan funding than anticipated in the Budget estimates resulting in lower interest revenue being recognised and a lower than budgeted loan receivable balance being recorded in the Administered Schedule of Assets and Liabilities.
184 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Department of Communications and the Arts NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
65
5Dividend revenue reflects the dividend paid to the Government by the Australian Postal Corporation. The Budget estimates for dividend revenue were updated during the year to reflect more recent projections as agreed by Shareholder Ministers.
6The Department’s Budget estimates for Administered Investments are generally held constant over the forward years due to the difficulties associated with predicting any changes likely to occur in the values of portfolio entities.
7Representing the closing balance of the Public Interest Telecommunications Services and National Cultural Heritage special accounts cash held in the Official Public Account. The variance is mainly driven by actual activities of the programs during the year.
Part 5: Appendices
Appendix 1 Agency resource statement and expenses for outcomes 186
Appendix 2 Advertising and market research 191
Appendix 3 Workplace health and safety 193
Appendix 4 Report on the Environment Protection and Biodiversity Conservation Act1999 194
Appendix 5 Compliance with section 24Y of the Australian Broadcasting Corporation Act 1983 195
Appendix 6 Report on the Protection of Movable Cultural Heritage Act 1986 (section47) 196
Appendix 7 Employee statistics 197
Appendix 8 Disclosure of executive remuneration 209
186 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Appendix 1 Agency resource statement and expenses for outcomes
Section 17AF(1)(b) of the Public Governance, Performance and Accountability Rule 2014 (PGPA Rule) requires the annual report to include a table summarising the total resources and total payments of the department.
Table A1.1 Agency resource statement 2018-19
Actual available appropriation for 2018-19
$’000
Payments made 2018-19 $’000
Balance remaining 2018-19 $’000
(a) (b) (a) - (b)
Ordinary annual services1
Prior-year departmental appropriation 17,616 17,616 -
Departmental appropriation 107,763 90,759 17,004
Departmental capital budget2 3,547 3,093 454
Section 74 relevant agency receipts 8,706 8,706 -
Total 137,632 120,174 17,458
Administered expenses
Outcome 1
Prior-year administered appropriation 63,797 43,633
Administered appropriation 209,037 154,117
Payments to corporate Commonwealth entities 1,327,637 1,327,637
Outcome 2
Prior-year administered appropriation 1,912 739
Administered appropriation 208,209 205,983
Administered capital budget2 1,608 1,608
Payments to corporate Commonwealth entities 461,293 461,293
Total 2,273,493 2,195,010
Total ordinary annual services A 2,411,125 2,315,184
Departmental non-operating
Prior-year equity injections 150 150 -
Total 150 150 -
PA R T 5 A p p e n d i c e s 187
Actual available appropriation for 2018-19
$’000
Payments made 2018-19 $’000
Balance remaining 2018-19 $’000
(a) (b) (a) - (b)
Administered non-operating
Prior-year administered appropriations 3,697,547 3,697,547
Administered assets and liabilities 5,055,869 3,472,952 1,582,917
Administered assets and liabilities payments to corporate Commonwealth entities 55,240 55,240
Payments to corporate Commonwealth entities — non operating - -
Total 8,808,656 7,225,739
Total other services B 8,808,806 7,225,889
Total available annual appropriations and payments 11,219,931 9,541,073
Special appropriations
Public Governance, Performance and Accountability Act 2013 — section 77 (Refund Provision) 47
Total special appropriations C 47
Special accounts
Opening balance 3,741
Appropriation receipts 100,827
Non-appropriation receipts to special accounts
262,117
Payments made 361,839
Total special account D 366,685 361,839 4,846
Total resourcing and payments
A+B+C+D 11,586,616 9,902,959 4,846
Less appropriations drawn from annual or special appropriations above and credited to special accounts and/or non-corporate entities through annual appropriations (100,827) (100,827)
Total net resourcing and payments 11,485,789 9,802,132
1 Departmental appropriation combines ordinary annual services (Appropriation Act Nos. 1 and 3) and includes prior-year departmental appropriation and retained revenue receipts under section 74 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).
2 For accounting purposes these amounts have been designated as ‘contributions by owners’.
188 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table A1.2 Expenses for Outcome 1
Outcome 1: Promote an innovative and competitive communications sector, through policy development, advice and program delivery, so all Australians can realise the full potential of digital technologies and communications services.
Budget2 2018-19 $’000
Actual expenses 2018-19 $’000
Variation 2018-19 $’000
(a) (b) (a) - (b)
Program 1.1: Digital Technologies and Communications
Administered expenses
Ordinary annual services (Appropriation Act Nos. 1 and 3) 139,349 86,226 53,123
Special accounts 350,101 345,030 5,071
Payments to corporate entities 1,327,637 1,327,637 -
Expenses not requiring appropriation in the budget year 10,916 8,031 2,885
Departmental expenses
Departmental appropriation1 84,506 73,046 11,460
Special accounts 4,046 4,041 5
Expenses not requiring appropriation in the budget year 4,532 3,254 1,278
Total for Program 1.1 1,921,087 1,847,265 73,822
Outcome 1 totals by appropriation type
Administered expenses
Ordinary annual services (Appropriation Act Nos. 1 and 3) 139,349 86,226 53,123
Special accounts 350,101 345,030 5,071
Payments to corporate entities 1,327,637 1,327,637 -
Expenses not requiring appropriation in the budget year 10,916 8,031 2,885
Departmental expenses
Departmental appropriation1 84,506 73,046 11,460
Special accounts 4,046 4,041 5
PA R T 5 A p p e n d i c e s 189
Budget2 2018-19 $’000
Actual expenses 2018-19 $’000
Variation 2018-19 $’000
(a) (b) (a) - (b)
Expenses not requiring appropriation in the budget year 4,532 3,254 1,278
Total expenses for Outcome 1 1,921,087 1,847,265 73,822
2018-19 2018-19
Average staffing level (number) 405 406 (1)
1 Departmental appropriation combines ordinary annual services (Appropriation Act Nos. 1 and 3), includes prior-year departmental appropriation and retained revenue receipts under section 74 of the PGPA Act.
2 Full-year budget, including any subsequent adjustment made to the 2018-19 budget at Additional Estimates.
Table A1.3 Expenses for Outcome 2
Outcome 2: Participation in, and access to, Australia’s art and culture through developing and supporting cultural expression.
Budget2 2018-19 $’000
Actual expenses 2018-19 $’000
Variation 2018-19 $’000
(a) (b) (a) - (b)
Program 2.1: Arts and Cultural Development
Administered expenses
Ordinary annual services (Appropriation Act Nos. 1 & 3) 207,709 207,679 30
Special accounts 500 475 25
Payments to corporate entities 461,293 461,293 -
Expenses not requiring appropriation in the budget year 1,638 2,657 (1,019)
Departmental expenses
Departmental appropriation1 21,260 32,425 (11,165)
Special accounts 4,692 5,487 (795)
190 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Budget2 2018-19 $’000
Actual expenses 2018-19 $’000
Variation 2018-19 $’000
(a) (b) (a) - (b)
Expenses not requiring appropriation in the budget year 647 2,134 (1,487)
Total for Program 2.1 697,739 712,150 (14,411)
Outcome 2 totals by appropriation type
Administered expenses
Ordinary annual services (Appropriation Act Nos. 1 & 3) 207,709 207,679 30
Special accounts 500 475 25
Payments to corporate entities 461,293 461,293 -
Expenses not requiring appropriation in the budget year 1,638 2,657 (1,019)
Departmental expenses
Departmental appropriation1 21,260 32,425 (11,165)
Special accounts 4,692 5,487 (795)
Expenses not requiring appropriation in the budget year 647 2,134 (1,487)
Total expenses for Outcome 2 697,739 712,150 (14,411)
2018-19 2018-19
Average staffing level (number) 139 135 4
1 Departmental appropriation combines ordinary annual services (Appropriation Act Nos. 1 and 3) and retained revenue receipts under section 74 of the PGPA Act.
2 Full-year budget, including any subsequent adjustment made to the 2018-19 budget at Additional Estimates.
PA R T 5 A p p e n d i c e s 191
Appendix 2 Advertising and market research
During 2018-19, weconducted the following advertising campaigns: National Online Safety Awareness Campaign.
Further information on this campaign is available at communications.gov.au and in the reports on Australian Government advertising prepared by the Department of Finance. Those reports are available on the Department of Finance’s website.
Tables A2.1 to A2.3 list any advertising and market research payments of more than $13,800 (inclusive of GST) made during 2018-19, asrequired by section311A of the Commonwealth Electoral Act 1918.
Table A2.1 Advertising agencies
Organisation name Purpose
Amount of payment (excluding GST)
TheMonkeys Creative services to support the National Online Safety Awareness Campaign $1,047,939
Total advertising agencies $1,047,939
Table A2.2 Market research organisations
Organisation name Purpose
Amount of payment (excluding GST)
ORIMA Research Qualitative and quantitative research to inform the Cook 250 project $254,168
ORIMA Research Qualitative and quantitative research to inform the National Online Safety Awareness Campaign
$498,567
Hall & Partners Quantitative research to evaluate the National Online Safety Awareness Campaign $152,403
Total market research organisations $905,138
192 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table A2.3 Media advertising organisations
Organisation name Purpose
Amount of payment (excluding GST)
IPG Mediabrands Australia (trading as Universal McCann)
Media buy services to support the National Online Safety Awareness Campaign $5,871,780
Total media advertising $5,871,780
PA R T 5 A p p e n d i c e s 193
Appendix 3 Workplace health and safety
In 2018-19, wecontinued our focus on prevention strategies, through our health, wellbeing and early-intervention programs. Initiatives included:
⺠an early-intervention approach and associated fund ⺠centralised management of reasonable workplace adjustment ⺠Healthy Living Month ⺠Health Hub
⺠dealing with bullying and harassment resources ⺠active social and workplace networks such as the Health and Safety Committee Wereceived no provisional improvement notices and had no notifiable incidents during2018-19.
OurRehabilitation Management System was audited by Comcare, with the corrective action plan finalised; a certification of compliance has been issued until June 2020.
194 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Appendix 4 Report on the Environment Protection and Biodiversity Conservation Act1999
Thefollowing information on our environmental management activities is provided in accordance with the Environment Protection and Biodiversity Conservation Act 1999.
Werecognise the importance of the five principles of ecologically sustainable development (integration, precaution, intergeneration, biodiversity and valuation) and, given the nature of our work, especially focus on the principles of intergeneration and integration. This is demonstrated through our decision-making processes, which always consider both short-term and long-term impacts.
Thedepartment is about to commence its third year in the Nishi building in New Acton. This building takes a progressive approach to achieving world-class environmental performance and has provided an opportunity for us to build on our previous commitment to continuing and improving environmental performance through the following initiatives.
⺠Thebuilding has dedicated secure recycling for the collection of paper, glass, plastic, metal and organic waste which, along with centralised collection points, allows for an increased uptake of recycling and organic waste disposal options and reduction in environmental footprint.
⺠Lighting is designed to comply with Australian Standards AS/NZS1680 and workstation lamps using LED technology.
⺠Thebuilding follows best practice in the use of paints, adhesives and materials with low volatile organic compound components in the construction and fitout, including at individual workstations.
⺠Theopen-plan floor design maximises access to natural light and views, with most workstations within eightmetres of a window, asper Green Building Council criteria.
⺠Thesmart building technology includes a ‘night purge’ of air from the building, which operates in response to outdoor temperatures and removes warm air in summer.
⺠Carbon dioxide monitors improve the accuracy of readings and the performance of air-conditioning across floors.
In February 2019, our tenancy in this building received a rating under the National Australian Built Environment Rating System of 5.0 stars. Opportunities for further improvement will continue to be identified and progressed in consultation with building management and our sub-tenant, Austrade.
PA R T 5 A p p e n d i c e s 195
Appendix 5 Compliance with section 24Y of the Australian Broadcasting Corporation Act 1983
Under subsection 12(1) of the Australian Broadcasting Corporation Act 1983, theAustralian Broadcasting Corporation (ABC) Board consists of a Managing Director, a Chairperson, a staff-elected Director and not fewer than four nor more than six other Directors. Section24Y of the Act requires our annual report to include a statement in relation to each selection process during the year for Board appointments other than the Managing Director and staff-elected Director.
In 2018-19, weprovided secretariat support to an independent nomination panel to recommend an appointment for the ABC Board position of Chairperson. Thepanel followed a merit-based selection process and made its appointment recommendation in January2019. TheAustralian Government made an appointment to the position in March2019.
196 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Appendix 6 Report on the Protection of Movable Cultural Heritage Act 1986 (section47)
This appendix constitutes a report on the working of the Protection of Movable Cultural Heritage Act 1986, asrequired under section47 of the Act.
Table A6.1 details actions taken under the Act.
Table A6.1 Actions taken under the Protection of Movable Cultural Heritage Act 1986
Action 2017-18 2018-19
Export Permit — permanent — issued 52 36
Export Permit — temporary — issued 8 8
Export Permit — permanent — refused 3 0
Certificate of Exemption — issued 23 19
National Cultural Heritage Account applications approved 4 4
Unlawful imports — return of protected foreign cultural property 4 human skulls returned to the
Government of the Republic of Indonesia
1 ammonite fossil returned to the People’s Democratic Republic of Algeria
PA R T 5 A p p e n d i c e s 197
Appendix 7 Employee statistics
All employees: gender, location, full-time and part-time
Tables A7.1 to A7.4 present statistics on the number of departmental employees (including by reference to ongoing and non-ongoing employees) in relation to gender, location, full-time and part-time as at 30 June 2019 and 30 June 2018.
No employees identified their gender as indeterminate, therefore the tables give statistics on male and female employees.
Table A7.1 All ongoing employees: 30June2019
Male Female
Full-time Part-time Total Full-time Part-time Total Total
NSW 13 - 13 21 5 26 39
Qld - - - 3 - 3 3
SA - - - 1 1 2 2
Tas - - - - - - -
Vic 7 - 7 8 2 10 17
WA - - - 1 - 1 1
ACT 149 13 162 249 59 308 470
NT - - - 4 - 4 4
Overseas - 1 1 - - - 1
Total 169 14 183 287 67 354 537
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2019 for a total period greater than 90days).
198 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table A7.2 All non-ongoing employees: 30June2019
Male Female
Total Full-time Part-time Total Full-time Part-time Total
NSW 1 1 2 2 0 2 4
Vic 1 - 1 1 - 1 2
ACT 6 - 6 8 1 9 15
Other - - - - - - -
Total 8 1 9 11 1 12 21
Table A7.3 All ongoing employees: 30June2018
Male Female
Total Full-time Part-time Total Full-time Part-time Total
NSW 16 1 17 19 6 25 42
Qld - - - 2 - 2 2
SA - - - 2 - 2 2
Tas - - - - - - -
Vic 6 - 6 10 1 11 17
WA - - - 1 - 1 1
ACT 165 10 175 254 60 314 489
NT - - - 4 - 4 4
Overseas - 1 1 - - - 1
Total 187 12 199 292 67 359 558
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2018 for a total period greater than 90days).
PA R T 5 A p p e n d i c e s 199
Table A7.4 All non-ongoing employees: 30June2018
Male Female
Total Full-time Part-time Total Full-time Part-time Total
NSW 2 - 2 5 - 5 7
ACT 10 1 11 16 6 22 33
Other - - - - - - -
Total 12 1 13 21 6 27 40
Public Service Act 1999 employees: classification levels, full-time, part-time, gender, location
Tables A7.5 to A7.12 present statistics on the number of Public Service Act 1999 (APSAct) employees in the department (including by reference to ongoing and non-ongoing employees) in relation to classification levels, full-time, part-time, gender andlocation as at 30June 2019 and 30 June 2018.
No employees identified their gender as indeterminate, therefore columns in the tables arelimited to statistics on male and female employees.
Table A7.5 APS Act ongoing employees: 30June2019
Male Female
Total Full-time Part-time Total Full-time Part-time Total
SES 3 2 - 2 1 - 1 3
SES 2 1 - 1 5 - 5 6
SES 1 11 1 12 15 - 15 27
EL 2 36 4 40 36 12 48 88
EL 1 45 5 50 84 29 113 163
APS 6 39 1 40 75 18 93 133
200 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Male Female
Total Full-time Part-time Total Full-time Part-time Total
APS 5 15 1 16 37 6 43 59
APS 4 11 1 12 26 1 27 39
APS 3 9 - 9 7 - 7 16
APS 2 - 1 1 1 1 2 3
Other - - - - - - -
Total 169 14 183 287 67 354 537
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2019 for a total period greater than 90days).
Table A7.6 APS Act non-ongoing employees: 30June2019
Male Female
Total Full-time Part-time Total Full-time Part-time Total
EL 1 1 - 1 3 - 3 4
APS 6 3 - 3 2 - 2 5
APS 5 2 - 2 1 - 1 3
APS 4 2 - 2 5 1 6 8
APS 3 - 1 1 - - - 1
Other - - - - - - -
Total 8 1 9 11 1 12 21
PA R T 5 A p p e n d i c e s 201
Table A7.7 APS Act ongoing employees: 30June2018
Male Female
Total Full-time Part-time Total Full-time Part-time Total
SES 3 2 - 2 2 - 2 4
SES 2 2 - 2 5 - 5 7
SES 1 12 1 13 13 1 14 27
EL 2 37 2 39 40 11 51 90
EL 1 51 6 57 85 30 115 172
APS 6 46 - 46 73 19 92 138
APS 5 19 1 20 34 3 37 57
APS 4 9 2 11 28 2 30 41
APS 3 8 - 8 12 - 12 20
APS 2 1 - 1 - 1 1 2
Other - - - - - - -
Total 187 12 199 292 67 359 558
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2018 for a total period greater than 90days).
202 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table A7.8 APS Act non-ongoing employees: 30June2018
Male Female
Total Full-time Part-time Total Full-time Part-time Total
EL 2 1 - 1 - - - 1
EL 1 4 1 5 1 2 3 8
APS 6 2 - 2 9 - 9 11
APS 5 - - - 5 1 6 6
APS 4 4 - 4 4 2 6 10
APS 3 1 - 1 1 1 2 3
APS 2 - - - 1 - 1 1
Other - - - - - - -
Total 12 1 13 21 6 27 40
PA R T 5 A p p e n d i c e s 203
Table A7.9 APS Act employees by full-time and part-time status: 30June2019
Ongoing Non-ongoing
Total Full-time Part-time Total Full-time Part-time Total
SES 3 3 - 3 - - - 3
SES 2 6 - 6 - - - 6
SES 1 26 1 27 - - - 27
EL 2 72 16 88 - - - 88
EL 1 129 34 163 4 - 4 167
APS 6 114 19 133 5 - 5 138
APS 5 52 7 59 3 - 3 62
APS 4 37 2 39 7 1 8 47
APS 3 16 - 16 - 1 1 17
APS 2 1 2 3 - - - 3
Other - - - - - - -
Total 456 81 537 19 2 21 558
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2019 for a total period greater than 90days).
204 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table A7.10 APS Act employees by full-time and part-time status: 30June2018
Ongoing Non-ongoing
Total Full-time Part-time Total Full-time Part-time Total
SES 3 4 - 4 - - - 4
SES 2 7 - 7 - - - 7
SES 1 25 2 27 - - - 27
EL 2 77 13 90 1 - 1 91
EL 1 136 36 172 5 3 8 180
APS 6 119 19 138 11 - 11 149
APS 5 53 4 57 5 1 6 63
APS 4 37 4 41 8 2 10 51
APS 3 20 - 20 2 1 3 23
APS 2 1 1 2 1 - 1 3
Other - - - - - - -
Total 479 79 558 33 7 40 598
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2018 for a total period greater than 90days).
PA R T 5 A p p e n d i c e s 205
Table A7.11 APS Act employment type by location: 30June2019
Ongoing Non-ongoing Total
NSW 39 4 43
Qld 3 - 3
SA 2 - 2
Tas 0 - -
Vic 17 2 19
WA 1 - 1
ACT 470 15 485
NT 4 - 4
Overseas 1 - 1
Total 537 21 558
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2019 for a total period greater than 90days).
206 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table A7.12 APS Act employment type by location: 30June2018
Ongoing Non-ongoing Total
NSW 42 7 49
Qld 2 - 2
SA 2 - 2
Tas - - -
Vic 17 - 17
WA 1 - 1
ACT 489 33 522
NT 4 - 4
Overseas 1 - 1
Total 558 40 598
Note: Data includes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2018 for a total period greater than 90days).
PA R T 5 A p p e n d i c e s 207
Information on employment arrangements
Table A7.13 presents statistics on the number of SES employees and non-SES employees covered by any enterprise agreements, individual flexibility arrangements, Australian workplace agreements, common-law contracts or determinations under subsection 24(1) of the Public Service Act, during 2018-19.
Table A7.13 APS Act employment arrangements: 2018-19
SES Non-SES Total
Enterprise Agreement 2018 to 2021 - 720 720
Individual flexibility arrangement - 17 17
Determinations under subsection 24(1) of the Public Service Act 42 - 42
Remuneration Tribunal Determination 1 - 1
Total 43 737 780
Note: In accordance with subsection 17AG(4)(b)(i) of the PGPA Rule, this table includes all SES and non-SES employees covered during 2018-19 (in other words, thetable does not present point-in-time data). Dataincludes inoperative staff (inoperative staff are those staff recorded as being on leave without pay at 30June2019 for a total period greater than 90days).
208 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Salary ranges
Table A7.14 presents the salary ranges available during 2018-19 for APS Act employees, by classification level.
Table A7.14 APS Act employment salary ranges by classification level: 2018-19
Minimum salary Maximum salary
SES 3 285,000 369,627
SES 2 228,888 295,800
SES 1 171,666 254,500
EL 2 119,665 161,337
EL 1 103,151 137,847
APS 6 79,686 107,943
APS 5 72,265 81,514
APS 4 64,819 72,518
APS 3 57,830 64,676
APS 2 50,849 58,344
APS 1 45,197 51,378
PA R T 5 A p p e n d i c e s 209
Appendix 8 Disclosure of executive remuneration
Tables A8.1 to A8.3 present remuneration information for key management personnel (KMP), senior executives and other highly paid staff.
210 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table A8.1 Remuneration information for key management personnel
1
Short-term benefits ($)
Post-employment benefits ($)
Other long-term benefits ($)
Total
remuneration ($) Name Position title Base salary
2
Other benefits and allowances
3
Superannuation contributions
4
Long-service leave
5
Mike Mrdak Secretary 600,545 56,603 93,186 15,966 766,300
Richard Eccles Deputy Secretary 343,788 49,095 63,017 8,610 464,510
Richard Windeyer Deputy Secretary 282,804 38,409 52,555 6,580 380,348
Jo Talbot Chief Operating Officer 236,875 42,826 46,010 6,352 332,063
Nadine Williams Acting Deputy Secretary
6
13,974 3,106 1,802 401 19,283
Sarah Vandenbroek Acting Chief Operating Officer 6
15,985 3,502 3,005 394 22,886
1,493,971 193,541 259,575 38,303 1,985,390
Notes:
1 No remuneration was provided in the form of bonuses; other long-term benefits (aside from long-service leave); or termination benefits.
2 Base salary is calculated as total cash salary paid during the financial year, less amounts paid for annual leave and long-service leave, with an adjustment for accruals at the beginning and end of the year.
3 Other benefits and allowances comprise car parking fringe benefits, executive vehicle allowances and annual leave expenses. Annual leave expense is calculated on an accrual basis as 20 workings days per year based on the point-in-time substantive salary.
4 Superannuation is calculated as actual superannuation contributions made during the year, with an adjustment for accruals at the beginning and end of the year.
5 Long-service leave is calculated on an accrual basis as nine calendar days leave per financial year based on the point-in-time substantive salary.
6 The officer acted in a key management personnel position for part of the year. The remuneration is the amount calculated for that period.
PA R T 5 A p p e n d i c e s 211
Table A8.2 Remuneration information for senior executives Total remuneration bands
Short-term benefits ($)
Post-employment benefits ($)
Other long-term benefits ($) Termination
benefits ($)
Average total remuneration ($)
Number of senior Executives
Average base salary Other benefits and allowances
Average
superannuation contributions
Average long-service leave
Average termination benefits
$0 to $220,000 11 78,340 22,244 16,195 3,743 - 120,522
$220,001 to $245,000 6 170,992 32,931 28,874 4,369 - 237,166
$245,001 to $270,000 13 179,109 35,351 35,169 4,875 - 254,504
$270,001 to $295,000 1 201,727 36,942 36,623 4,844 - 280,136
$295,001 to $320,000 3 180,606 36,843 35,228 5,605 46,541 304,823
$320,001 to $345,000 1 237,633 42,455 45,339 6,233 - 331,660
$345,001 to $370,000 1 271,615 28,833 53,417 7,035 - 360,900
Note: No remuneration was provided in the form of bonuses or other long-term benefits (aside from long-service leave).
212 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Table A8.3 Remuneration information for other highly paid staff Total remuneration bands
Short-term benefits ($)
Post-employment benefits ($) Other long-term
benefits ($)
Number of other highly paid staff Base salary Other benefits and allowances
Superannuation contributions Long-service leave
Total
remuneration ($)
$245,001 to $270,000 1 190,266 23,079 34,026 5,185 252,556
Note: No remuneration was provided in the form of bonuses, other long-term benefits (aside from long-service leave) or termination benefits.
Part 6: Reference information
Abbreviations and acronyms 214
Glossary of terms 216
List of requirements 219
Index 228
214 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Abbreviations and acronyms
ABC Australian Broadcasting Corporation
ACCC Australian Competition and Consumer Commission
ACMA Australian Communications and Media Authority
AFTRS Australian Film, Television and Radio School
ANMM Australian National Maritime Museum
APS Australian Public Service
APS Act Public Service Act 1999
APT Asia-Pacific Telecommunity
auDA .au Domain Administration
CALD Cultural and linguistic diversity
EL Executive Level
FOI Freedom of information
GDP Gross domestic product
GST Goods and services tax
IT Information technology
ITU International Telecommunication Union
ITU-R International Telecommunication Union — Radiocommunication Sector
IY2019 International Year of Indigenous Languages
LED Light-emitting diode
LGBTQIA+ Lesbian, gay, bisexual, trans, queer, intersex, asexual and all people of diverse genders and sexualities
MoAD Museum of Australian Democracy at Old Parliament House
NAIDOC National Aborigines and Islanders Day Observance Committee
NBN National Broadband Network
NBN Co NBN Co Limited
NFSA NationalFilm and Sound Archive of Australia
NGA NationalGallery of Australia
PA R T 6 R e f e r e n c e I n f o r m a t i o n 215
NLA National Library of Australia
NMA National Museum of Australia
NPGA National Portrait Gallery of Australia
NRS National Relay Service
PBS Portfolio Budget Statements
PDV Post, Digital and Visual (Effects)
PGPA Act Public Governance, Performance and Accountability Act 2013
PGPA Rule Public Governance, Performance and Accountability Rule 2014
PIO Postal Industry Ombudsman
SBS Special Broadcasting Service Corporation
SES Senior Executive Service
TIO Telecommunications Industry Ombudsman
TUSOPA Telstra Universal Service Obligation Performance Agreement
UNESCO United Nations Educational, Scientific and Cultural Organization
UPU Universal Postal Union
USG Universal Service Guarantee
USO Universal Service Obligation
WHS Workplace health and safety
WRC World Radiocommunication Conference
216 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Glossary of terms
5G Thenext step in the evolution of mobile wireless
communications technology, promising improved connectivity, greater network speeds and bandwidth, and very low latency
APS employee A person engaged under section 22, or a person who is engaged as an APS employee under section 72, of the Public Service Act 1999
Carriers Holders of a telecommunications carrier licence
Classification Board Thebody established under the Classification (Publications, Films and Computer Games) Act1995 that classifies films, computer games and publications for exhibition, sale or hire in Australia
Corporate governance
Theprocess by which entities are directed and controlled. Itis generally understood to encompass authority, accountability, stewardship, leadership, direction and control
Enterprise Agreement A written agreement about working conditions and wages made between an employer and its employees
Financial results Theresults shown in the financial statements of an entity
Fixed-line A network in which voice, data or broadband services are delivered over a physical line
Free-to-air Thebroadcast services available without a subscription or fee
Grant Commonwealth financial assistance covered by the
Commonwealth Grants Rules and Guidelines
Mobile black spot A location with poor or non-existent mobile coverage
National Arts and Disability Strategy A framework for jurisdictions to assess and improve existing activities, consider new opportunities and directions, and
identify new partnerships and initiatives
PA R T 6 R e f e r e n c e I n f o r m a t i o n 217
National Classification Scheme
A cooperative arrangement between the Australian Government and state and territory governments under which the Classification Board classifies films, computer games and certain publications
Non-ongoing APS employee A person engaged as an APS employee under subsection 22(2)(b) or 22(2)(c) of the Public Service Act 1999
Ongoing APS employee
A person engaged as an ongoing APS employee under subsection 22(2)(a) of the Public Service Act 1999
Operations Functions, services and processes performed in pursuing the objectives or discharging the functions of an entity
Outcomes Theresults, impacts or consequences of actions by the Commonwealth on the Australian community — these should be consistent with those listed in the entity’s Portfolio Budget Statements and Portfolio Additional Estimates Statements
Performance information
Evidence about performance that is collected and used systematically and may relate to appropriateness, effectiveness and efficiency and the extent to which an outcome can be attributed to an intervention — performance information may be quantitative (numerical) or qualitative (descriptive), and it should be verifiable
Programs An activity or group of activities that deliver benefits, services or transfer payments to individuals, industry/business or the community as a whole and are the primary vehicles for Commonwealth entities to achieve the intended results of their outcome statements
Purpose Theobjectives, functions or role of the entity or company. Inrelation to performance management, purposes are the reasons or ideal state or outcomes, for which the entity or company undertakes its activities
218 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
QR code A machine-readable quick response matrix barcode containing information about the item it is attached to
Service charters Government policy stipulates that entities that provide services directly to the public have service charters in place. Aservice charter is a public statement about the service that an entity will provide and what customers can expect from the entity. Inparticular, theservice charter advises what the entity does, how to contact and communicate with the entity, thestandard of service that customers can expect, and their basic rights and responsibilities, and how to provide feedback or make a complaint
Spectrum Thespan of electromagnetic frequencies used in communications systems
Sustainable Development Goals Also known as the Global Goals, 17 goals that seek to address issues related to poverty, inequality, climate, environmental
degradation, prosperity, and peace and justice. Thegoals were adopted by world leaders in September 2015 at a summit of the United Nations
Universal Service Obligation Theobligation placed on universal service providers to ensure that all people in Australia, wherever they reside or carry on
business, have reasonable access, on an equitable basis, to standard telephone services, including payphones
PA R T 6 R e f e r e n c e I n f o r m a t i o n 219
List of requirements Table R.1 reproduces the table set out in Schedule2 of the Public Governance, Performance and Accountability Rule 2014. Section 17AJ(d) requires this table to be included in entities’ annual reports as an aid of access.
Table R.1 List of requirements
PGPA Rule reference Description Requirement
Part of report Page
17AD(g) Letter of transmittal
17AI A copy of the letter of transmittal signed and dated by accountable authority on date final text approved, with statement that the report has been prepared in accordance with section46 of the Act and any enabling legislation that specifies additional requirements in relation to the annual report
Mandatory Letter of transmittal iii
17AD(h) Aids to access
17AJ(a) Table of contents Mandatory Contents iv-v
17AJ(b) Alphabetical index Mandatory Reference
information
228
17AJ(c) Glossary of abbreviations and acronyms Mandatory Reference information
214-218
17AJ(d) List of requirements Mandatory Reference
information 219-227
17AJ(e) Details of contact officer Mandatory Publication
details
ii
17AJ(f) Entity’s website address Mandatory Publication
details
ii
17AJ(g) Electronic address of report Mandatory Publication
details
ii
17AD(a) Review by accountable authority
17AD(a) A review by the accountable authority of the entity Mandatory Part1 2-9
220 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
PGPA Rule reference Description Requirement
Part of report Page
17AD(b) Overview of the entity
17AE(1) (a)(i)
A description of the role and functions of the entity Mandatory Part1 10
17AE(1) (a)(ii)
A description of the organisational structure of the entity Mandatory Part1 11-12
17AE(1) (a)(iii)
A description of the outcomes and programs administered by the entity Mandatory Part1 11
17AE(1) (a)(iv)
A description of the purposes of the entity as included in the Corporate Plan
Mandatory Part1 10
17AE(1)(b) An outline of the structure of the portfolio of the entity Portfolio departments
— mandatory
Part1 13-16
17AE(2) Where the outcomes and programs administered by the entity differ from any Portfolio Budget Statement, Portfolio Additional Estimates Statement or other portfolio estimates statement that was prepared for the entity for the period, include details of variation and reasons for change
If applicable, mandatory n/a n/a
17AD(c) Report on the performance of the entity
Annual performance statements
17AD(c)(i); 16F Annual performance statements in accordance with paragraph 39(1)
(b) of the Act and section 16F of the Rule
Mandatory Part2 17-96
17AD(c)(ii) Report on financial performance
17AF(1)(a) Discussion and analysis of financial performance Mandatory Part 1 6-8
17AF(1)(b) A table summarising the total resources and total payments of the entity
Mandatory Appendix1 186-190
PA R T 6 R e f e r e n c e I n f o r m a t i o n 221
PGPA Rule reference Description Requirement
Part of report Page
17AF(2) If there may be significant changes in the financial results during or after the previous or current reporting period, information on those changes, including: the cause of any operating loss of the entity; how the entity has responded to the loss and the actions that have been taken in relation to the loss; and any matter or circumstances that it can reasonably be anticipated will have a significant impact on future operation or financial results
If applicable, mandatory n/a n/a
17AD(d) Management and accountability
Corporate governance
17AG(2)(a) Information on compliance with section 10 (fraud systems) Mandatory Letter of transmittal
iii
17AG(2) (b)(i)
A certification by accountable authority that fraud risk assessments and fraud control plans have been prepared
Mandatory Letter of transmittal iii
17AG(2) (b)(ii)
A certification by the accountable authority that appropriate mechanisms for preventing, detecting incidents of, investigating or otherwise dealing with, and recording or reporting fraud that meet the specific needs of the entity are in place
Mandatory Letter of transmittal iii
17AG(2) (b)(iii)
A certification by the accountable authority that all reasonable measures have been taken to deal appropriately with fraud relating to the entity
Mandatory Letter of transmittal iii
17AG(2)(c) An outline of structures and processes in place for the entity to implement principles and objectives of corporate governance
Mandatory Part3 98-103
222 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
PGPA Rule reference Description Requirement
Part of report Page
17AG(2)(d) to (e) A statement of significant issues reported to Minister under paragraph
19(1)(e) of the Act that relates to non-compliance with finance law and action taken to remedy non-compliance
If applicable, mandatory n/a n/a
External scrutiny
17AG(3) Information on the most significant developments in external scrutiny and the entity’s response to the scrutiny
Mandatory Part3 104
17AG(3)(a) Information on judicial decisions and decisions of administrative tribunals and by the Australian Information Commissioner that may have a significant effect on the operations ofthe entity
If applicable, mandatory n/a n/a
17AG(3)(b) Information on any reports on operations of the entity by the Auditor-General (other than reportunder section 43 of the Act), aParliamentary Committee, or the Commonwealth Ombudsman
If applicable, mandatory Part3 104
17AG(3)(c) Information on any capability reviews on the entity that were released during the period
If applicable, mandatory n/a n/a
Management of human resources
17AG(4)(a) An assessment of the department’s effectiveness in managing and developing employees to achieve entity objectives
Mandatory Part3 103
17AG(4)(b) Statistics on the entity’s APS employees on an ongoing and non-ongoing basis; including the following:
⺠staffing classification level ⺠full-time employees ⺠part-time employees ⺠gender
⺠staff location ⺠employees who identify as Indigenous
Mandatory
Mandatory
Mandatory
Mandatory
Mandatory
Mandatory
Appendix 7
Appendix 7
Appendix 7
Appendix 7
Appendix 7
Part3
199-204
197-204
197-204
197-202
197-199, 205-206
109
PA R T 6 R e f e r e n c e I n f o r m a t i o n 223
PGPA Rule reference Description Requirement
Part of report Page
17AG(4)(c) Information on any enterprise agreements, individual flexibility arrangements, Australian workplace agreements, common law contracts and determinations under subsection 24(1) of the Public Service Act 1999
Mandatory Part 3
Appendix 7
110
207
17AG(4) (c)(i)
Information on the number of SES and non-SES employees covered by agreements etc. identified in paragraph 17AG(4)(c)
Mandatory Appendix 7 207
17AG(4) (c)(ii)
Thesalary ranges available for APS employees by classification level Mandatory Appendix 7 208
17AG(4) (c)(iii)
A description of non-salary benefits provided to employees Mandatory Part3 111
17AG(4) (d)(i)
Information on the number of employees at each classification level who received performance pay
If applicable, mandatory n/a n/a
17AG(4) (d)(ii)
Information on aggregate amounts of performance pay at each classification level
If applicable, mandatory n/a n/a
17AG(4) (d)(iii)
Information on the average amount of performance payment, and range of such payments, at each classification level
If applicable, mandatory n/a n/a
17AG(4) (d)(iv)
Information on aggregate amount of performance payments If applicable, mandatory
n/a n/a
Assets management
17AG(5) An assessment of effectiveness of assets management where asset management is a significant part of theentity’s activities
If applicable, mandatory Part3 113
Purchasing
17AG(6) An assessment of entity performance against the Commonwealth Procurement Rules
Mandatory Part3 113
224 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
PGPA Rule reference Description Requirement
Part of report Page
Consultants
17AG(7)(a) A summary statement detailing the number of new contracts engaging consultants entered into during the period; the total actual expenditure on all new consultancy contracts entered into during the period (inclusive of GST); the number of ongoing consultancy contracts that were entered into during a previous reporting period; and the total actual expenditure in the reporting year on the ongoing consultancy contracts (inclusive of GST)
Mandatory Part3 114
17AG(7)(b) A statement that “During [reporting period], [specified number] new consultancy contracts were entered into involving total actual expenditure of $[specifiedmillion]. Inaddition, [specified number] ongoing consultancy contracts were active during the period, involving total actual expenditure of $[specifiedmillion] ”
Mandatory Part3 114
17AG(7)(c) A summary of the policies and procedures for selecting and engaging consultants and the main categories of purposes for which consultants were selected and engaged
Mandatory Part3 113-114
17AG(7)(d) A statement that “Annual reports contain information about actual expenditure on contracts for consultancies. Information on the value of contracts and consultancies is available on the AusTender website”
Mandatory Part3 114
PA R T 6 R e f e r e n c e I n f o r m a t i o n 225
PGPA Rule reference Description Requirement
Part of report Page
Australian National Audit Office access clauses
17AG(8) If an entity entered into a contract with a value of more than $100,000 (inclusive of GST) and the contract did not provide the Auditor-General with access to the contractor’s premises, thereport must include the name of the contractor, purpose and value of the contract, and the reason why a clause allowing access was not included in the contract
If applicable, mandatory n/a n/a
Exempt contracts
17AG(9) If an entity entered into a contract or there is a standing offer with a value greater than $10,000 (inclusive of GST) which has been exempted from being published in AusTender because it would disclose exempt matters under the FOI Act, theannual report must include a statement that the contract or standing offer has been exempted, and the value of the contract or standing offer, to the extent that doing so does not disclose the exempt matters
If applicable, mandatory n/a n/a
Small business
17AG(10) (a) A statement that “[Name of entity] supports small business participation
in the Commonwealth Government procurement market. Small and Medium Enterprises (SME) and Small Enterprise participation statistics are available on the department of Finance’s website”
Mandatory Part3 115
17AG(10) (b) An outline of the ways in which the procurement practices of the
entity support small and medium enterprises
Mandatory Part3 115
226 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
PGPA Rule reference Description Requirement
Part of report Page
17AG(10) (c) If the entity is considered by the department administered by the
Finance Minister as material in nature — a statement that “[Name of entity] recognises the importance of ensuring that small businesses are paid on time. Theresults of the Survey of Australian Government Payments to Small Business are available on the Treasury’s website”
If applicable, mandatory Part3 115
Financial statements
17AD(e) Inclusion of the annual financial statements in accordance with subsection 43(4) of the Act
Mandatory Part4 117-184
17AD(f) Other mandatory information
17AH(1) (a)(i)
If the entity conducted advertising campaigns, a statement that “During [reporting period], the[name of entity] conducted the following advertising campaigns: [name of advertising campaigns undertaken]. Further information on those advertising campaigns is available at [address of entity’s website] and in the reports on Australian Government advertising prepared by the Department of Finance. Those reports are available on the Department of Finance’s website”
If applicable, mandatory Appendix 2 191
17AH(1) (a)(ii)
If the entity did not conduct advertising campaigns, a statement to that effect
If applicable, mandatory n/a n/a
17AH(1)(b) A statement that “Information on grants awarded by [name of entity] during [reporting period] is available at [address of entity’s website]”
If applicable, mandatory Part3 115
17AH(1)(c) Outline of mechanisms of disability reporting, including reference to website for further information
Mandatory Part3 107
PA R T 6 R e f e r e n c e I n f o r m a t i o n 227
PGPA Rule reference Description Requirement
Part of report Page
17AH(1)(d) Website reference to where the entity’s Information Publication Scheme statement pursuant to Part II of FOI Act can be found
Mandatory Part3 104
17AH(1)(e) Correction of material errors in previous annual report If applicable, mandatory
Part 2 91
17AH(2) Information required by other legislation
Reporting on advertising and market research (section 311A of the Commonwealth Electoral Act 1918) and statement on advertising campaigns
Mandatory Appendix 2 191-192
Information on work health and safety matters (schedule 2, part 4 of the Work Health and Safety Act 2011)
Mandatory Appendix 3 193
Reporting on ecologically sustainable development and environmental performance (section 516A of the Environment Protection and Biodiversity Conservation Act 1999)
Mandatory Appendix 4 194
A statement in relation to each selection process for the appointment of an Australian Broadcasting Corporation Director referred to in paragraph 12(1)(b) or (c) that was completed in the financial year, asrequired under section24Y of the Australian Broadcasting Corporation Act 1983
Mandatory Appendix 5 195
An annual report on the working of the Protection of Movable Cultural Heritage Act 1986, asrequired under section 47 of that Act
Mandatory Appendix 6 196
228 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
Index
.au Domain Administration (auDA), vii, 45, 47 5G, ix, 4, 9, 45-47
A
Administrative Arrangements Order, 10 advertising and market research, 191-192 agency resource statement, 186-187 AlphaBeta (data analytics and research firm), 43 amaysim, 31 Amplifying Australia’s Voice in the Pacific, 32 ancestral remains repatriation, 70-71, 87 annual performance statements, 17-96
connectivity, 25-54 creativity and culture, 55-87 statement of preparation, 18 Artbank, vii, 63-64, 113 arts funding, 61, 64, 77-78, 91 Asia Pacific Telecommunity (APT), 45, 50 assets management, 113 audio description (television), 37 Auditor-General, 104 audits, 26, 100, 103-104 Ausfilm, 79 AusTender, 113-114 Austrade, 194 Australia Council, 14, 79 Australia Post, ix, 4, 13, 25, 31-33, 49 Australian and Children’s Screen Content Review, 92 Australian Arts and Culture Fund, 79 Australian Ballet School, 67 Australian Broadcasting Corporation (ABC), viii, 6, 14, 52, 76, 78 section 24Y compliance, 195 Australian Bureau of Statistics, 42, 45-46, 63-64 Australian Children’s Television Foundation, 80 Australian Communication Exchange Ltd (ACE), 36, 54 Australian Communications and Media Authority (ACMA), 14 broadcasting compliance, 73, 76 captioning compliance, 37 gambling regulation, 38-39
NBN and telecommunications complaints, 29-30 oversight of ACMA by the department, 49 reporting by ACMA, 28, 76 response to ACMA review, ix, 45 spectrum auction, 47 Australian Communications Consumer Action
Network (ACCAN), ix, 50 Australian Competition and Consumer Commission (ACCC), ix, 35 Australian Film, Television and Radio School
(AFTRS), 15, 56, 79 Australian Government International Exhibitions Insurance program, 80 Australian Institute of Aboriginal and Torres Strait
Islander Studies (AIATSIS), 68, 106 Australian Music Industry Package, 9, 64 Australian National Academy of Music, 67 Australian National Audit Office, 104 Australian National Maritime Museum (ANMM),
15, 79, 83, 86 Australian Network on Disability, 108 Australian Postal Corporation Act 1989, 31 Australian Public Service Commission, 107 Australian Youth Orchestra, 67
B
BellchambersBarrett, 103 Briggs Review, 40 Broadcasting Services Act 1992, 40, 73, 76 Bundanon Trust, 15, 71, 80 Bureau of Communications and Arts Research,
12, 62, 74
C
capability development of staff, 8-9, 105-107 captioning (television), 37 carrier powers and immunities, 46 case studies
Christchurch terror attacks, 41 Indigenous Languages and Arts program, 69 National Arts and Disability Strategy, 60 classification, viii, 72-73, 76
PA R T 6 R e f e r e n c e I n f o r m a t i o n 229
Classification Board, 73, 110 Classification Review Board, 73 Comcare, 193 committees, 98 Commonwealth Electoral Act 1918, 191 Commonwealth Fraud Control Framework, iii, 103 Communications Alliance, 3, 31 Community Broadcasting Foundation, 50 Community Broadcasting Program, 50 Concentrix Services Pty Ltd, 37, 54 consultants, 113 consumer experiences, 29 consumer protection, 26, 38 Consumer Representation Grants Program, 50 Consumer Safeguards Review, 31 contact officer, details, ii content regulatory framework, 72-75 Cook, James, commemorating the 250th
anniversary of James Cook’s pacific voyage, vii, 83 copyright, viii, 6, 50, 72-75 Copyright Act 1968, 74
Copyright Agency, 75 reform initiatives, 74 corporate governance, 98-103 Coulton, the Hon Mark Coulton MP, 2, 10 Creative Partnerships Australia, 15, 64, 79, 81 Cultural Gifts Program, vii
D
Department of Finance, 20, 29, 31, 115, 191 departmental overview agency resource statement, 186-187 expenses for outcomes, 188-190
ministerial arrangements, 10 outcomes and programs, 11 portfolio entities, 13-16 purposes, 10 role and functions, 10 Deputy Secretaries, 11 Desart, 69 disability, people with
communications access, 34, 36 creativity and culture, vii, 55, 74 National Arts and Disability Strategy, vi, 5, 59-60
E
Early Years Online Safety Program, 40 economy communications, 45-47 creative and cultural, 62-64
elite performing arts organisations, vi, 34, 66-67 employees, see staff employment in arts, ix, 91 Enhancing Online Safety Act 2015, 40 Enterprise Agreement, 110, 207 Environment Protection and Biodiversity
Conservation Act 1999, 194 eSafety, viii, 3, 39-41 ethical standards, 103 expenses for outcomes, 188-190
F
Festivals Australia, vi, 81 Fifield, Senator the Hon Mitch, 2, 10 Film Certification Advisory Board, 63 Film Location Grant, 81 financial management, 6-8, 113-115
agency resource statement, 186-187 assets management, 113 expenses for outcomes, 188-190 procurement, 113 financial statements, 117-183 Fletcher, the Hon Paul Fletcher MP, iii, 2, 10 flexible work arrangements, 111-112 Flying Fruit Fly Circus, 67 Foreign Actor Certification Scheme, vi, 64 Fox Sports, vii, 53 fraud control systems, iii, 103 freedom of information (FOI), 104 functions and roles of the department, 10
G
gambling regulation, viii, 38-39 GDP communications, 45-47 creative and cultural, 62-64
Global Betting and Gaming Consultants (GBGC), 38 governance, 98-103 graduate employees, 105, 108 grant programs, 115
230 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
H
Household, Income and Labour Dynamic in Australia (HILDA) Survey, 35 human resources, 105-112
I
Indigenous business participation in procurement, 115 Indigenous employment, 109 Indigenous Grants Policy, 68 Indigenous languages and arts, vi, 66-69, 82 Indigenous repatriation, 70-71, 87 Indigenous Visual Arts Industry Support program,
82-83 individual flexibility arrangements (staff), 110, 207 Information Publication Scheme (IPS), 104 intellectual property, 50 Interactive Gambling Act 2001, 39 internal audit, 103 International Cultural Diplomacy Arts Fund, 70, 83 International Telecommunication Union (ITU), vii,
4, 43-45, 50 international organisation contributions, 50
L
lending rights, vii, 85 letter of transmittal, iii list of requirements, 219-227 Location Offset, 63
M
McKenzie, Senator the Hon Bridget, 2, 10 media reform, 75 media regulatory framework, 72, 75-76 Meeting of Cultural Ministers, 59, 87 ministerial arrangements, 10 Mobile Black Spot Program, ix, 4, 6, 9, 28-29, 51 Mrdak, Mike, see Secretary Museum of Australian Democracy at Old
Parliament House (MoAD), 2, 15, 56, 79 Museums and Galleries Australia Bursaries, 86
N
National Aboriginal and Islander Skills Development Association Dance College, 67 National Arts and Disability Strategy, vi, 5, 59-60
National Broadband Network (NBN) loan, 51 NBN Co, 14, 29-31 pricing, 36 rollout, ix, 4, 25, 54 take-up, 42-43 National Collecting Institutions Touring and
Outreach Program, vi, 83 National Cultural Heritage Account, 87 national cultural institutions, vi, 14-16, 55-58, 70 national elite performing arts training
organisations, vi, 34, 66-67 National Film and Sound Archive of Australia (NFSA), 16, 56, 79 National Gallery of Australia (NGA), 16, 56, 79 National Institute of Circus Arts, 67 National Institute of Dramatic Arts, 67 National Library of Australia (NLA), 16, 56, 79, 86 National Museum of Australia (NMA), 16, 56, 79 National Online Safety Awareness campaign
(‘Start the Chat’), 40, 191-192 National Portrait Gallery of Australia (NPGA), 16, 56, 79 National Relay Service (NRS), ix, 4, 36-37, 54 NBN Co, see National Broadband Network (NBN) Netflix, 73, 76 notifiable incidents, 193
O
Office of the eSafety Commissioner, viii, 14, 39-40 Old Parliament House, 2, 15, 56, 79 online safety, viii, 3, 39-41 Online Safety Grants Program, 40 Online Safety Research Program, 9, 40 Optus, 3, 28, 31, 47 organisational structure (chart), 11-12 outcomes and programs, 11
P
pay executive remuneration, 110, 209-212 salary ranges, 208 performance, see annual performance statements performing arts training organisations, vi, 34,
66-67 philanthropic funding to the creative and cultural sectors, 61, 64-65 Pivotel, 31 planning and reporting framework, 101-102 portfolio entities, 13-16 Post, Digital and Visual Effects (PDV) Offset, 63
PA R T 6 R e f e r e n c e I n f o r m a t i o n 231
Postal Industry Ombudsman (PIO), 32-33 postal services, 25, 31-33 Prime Minister’s Literary Awards, vi, 84 procurement, 113 program and outcome structure, 11 Protection of Cultural Objects on Loan Scheme, 59 Protection of Movable Cultural Heritage Act 1986,
vii, 70, 196 Public and Educational Lending Right Scheme, vii, 85 Public Governance, Performance and
Accountability Act 2013 (PGPA Act), 18-19, 88, 102, 113, 117 Public Interest Telecommunications Services Special Account, 36, 54 Public Service Act 1999, 199, 207
individual determinations under subsection 24(1), 111, 207 purchasing, 113 purposes of the department, 10
R
recruitment, 105, 108 regional, rural and remote Australia access to arts and cultural experiences, vi, 5, 55, 59, 81-86
Mobile Black Spot Program, ix, 4, 6, 9, 28-29, 51 NBN, 29, 43 Regional and Small Publishers Cadetship Program, 6, 53, 75
Regional Arts Fund, 5, 85 Regional Backbone Blackspots Program, 52 Regional Broadcasting, 52 Regional Connectivity Program, viii, 9, 28-29 Regional Journalism Scholarship Program, viii,
6, 52, 75 Regional Telecommunications Review, ix, 4, 28 Stronger Regional Digital Connectivity
Package, 28 see also Universal Service Guarantee (USG) and Universal Service Obligation (USO) Register of Cultural Organisations, vii, 61, 65 remuneration
executive remuneration, 110, 209-212 salary ranges, 208 repatriation of ancestral remains, 70-71, 87 reporting and planning framework, 101-102 Resale Royalty Scheme, vi, 5, 64 risk management, 103 roles and functions of the department, 10 RSM Australia, 103
S
safety Office of the eSafety Commissioner, viii, 14, 39-40 online safety, viii, 3, 39-41 workplace health and safety, 193
salaries executive remuneration, 110, 209-212 salary ranges, 208
Screen Australia, 16, 56, 79, 85 Screenrights, 75 scrutiny, 104 Secretary, 11
outlook, 8-9 review, 2-8 Senior Executive Service (SES), 111 small business participation in procurement, 115 Special Broadcasting Service Corporation (SBS), viii, 6, 14, 52, 76, 78 Spectrum Pricing — Transitional Support, 53 spectrum reforms (including for 5G), ix, 4, 9, 42-43, 47 sports broadcasting, vii, 6, 53, 75 staff diversity, 101, 108, 110, 112 employment terms and conditions, 110-112 flexible work arrangements, 111-112 non-salary benefits, 111 recruitment, 105, 108 remuneration, 110, 208-212 retention and turnover, 106 training and development, 8-9, 105-107 workforce planning, 105 see also Secretary; Senior Executive Service Start the Chat (National Online Safety Awareness campaign), 40, 191-192 StarTrack, 32 state and territory government funding to the arts, 91 Stronger Regional Digital Connectivity Package, 28 structure (organisational), 11-12 Supporting Under-represented Sports program, vii, 6, 53, 75 Sustainable Development Goals, 26, 66
232 C O M M S & A R TS A n n u a l R e p o r t 2 0 1 8 - 1 9
T
telecommunications Regional Telecommunications Review, ix, 4, 28 see also Universal Service Guarantee (USG) and Universal Service Obligation (USO) Telecommunications Act 1997, 29 Telecommunications Industry Ombudsman (TIO),
30-31 television audio description, 37 television captioning, 37 Telstra, 3, 25-28, 31, 36, 47, 54 tendering, 113 TPG, 3 training and development, 8-9, 105-107 triple zero emergency calls, ix
U
United Nations, 26, 66, 68, 71, 109 Universal Postal Union (UPU), 4, 43-44 Universal Service Guarantee (USG) and Universal Service Obligation (USO), 4, 9, 25-27
V
Visions of Australia regional exhibitions touring program, 86 Vocus, 52 Vodafone, 3, 28, 31, 47
W
WestWood Spice, 54 WiFi and Mobile Coverage on New South Wales Central Coast Trains, 51 workforce planning, 105 workplace diversity, 101, 108, 110, 112 workplace health and safety, 193 World Intellectual Property Organization (WIPO), 50 World Radiocommunication Conference (WRC),
45, 47
