Governing the City State - Chief Minister and Treasury Directorate ...

Table 6 - General Government Sector Expenses – 2010-11 Budget 322009-10 2009-10 2010-11 2011-12 2012-13 2013-14BudgetExpensesEst. OutcomeBudgetVarEstimateEstimateEstimate$'000$'000$'000%$'000$'000$'0001,231,024 Employee Expenses 1,275,895 1,343,413 5 1,386,307 1,440,145 1,497,489227,876 Superannuation Interest Cost 217,167 233,200 7 264,700 279,600 294,200207,188Other SuperannuationExpenses 236,618 222,919 -6 230,200 236,348 244,606230,740 Depreciation and Amortisation 261,168 283,132 8 309,671 327,631 331,63965,264 Interest Expenses 59,062 81,009 37 110,915 124,945 123,947Other Operating Expenses808,971 Supplies and Services 754,184 809,802 7 848,676 919,654 976,135145,868 Other 169,071 158,299 -6 166,357 173,142 181,437705,871 Grants Expenses 724,886 708,933 -2 705,812 723,093 745,2903,622,802 Total Expenses 3,698,051 3,840,707 4 4,022,638 4,224,558 4,394,743Health ExpenditureThe ACT’s role as the regional hub places financial and other burdens on the ACT Budget,some of which are compensated for under CGC processes, but which are in some casesexacerbated by intergovernmental funding agreements. In health, for example, cross borderpatients account for 25% of inpatient hospital activity in the ACT and 30% of the ACTelective surgery waiting list. NSW patients comprise 12% of ACT emergency departmentactivity. NSW patients are also typically older and sicker than ACT patients with a 30%higher average acuity.While cost recovery arrangements are in place with NSW, it is important to recognise thatintergovernmental funding agreements usually divide Commonwealth funding betweenjurisdictions on an “equal per capita” formula which means the ACT is funded on the basis ofits resident population, but delivers services (and therefore incurs costs and has itsperformance measured) based on the larger regional service population.The ACT is not alone in facing a future fiscal position where the health system will consumea growing proportion of the Budget. This will force difficult issues to be engaged with, andthe Government will require the highest standards of coordinated and comprehensivestrategic and operational advice to manage this issue. Indeed, the Treasurer and Minister forHealth, Ms Katy Gallagher MLA, had warned “there may be no room for tax levels to bereduced in the future if governments are to deliver health services which meet community32 ACT Government (2010b).Context for the Review: 47