Cash flows

In 2006-07, the underlying cash balance is expected to be a surplus of $11.8 billion compared to an estimate of $10.8 billion at the 2006-07 Budget.

Detailed Australian Government general government sector receipt estimates for 2006-07, compared with the estimates published in the 2006-07 Budget, are provided in Table 12.

Table 10: Summary of Australian Government general government sector
cash flows ($b)^(a)

1. Cash flows are derived from the accrual GFS framework excluding GST.
2. Equivalent to cash receipts from the sale of non-financial assets in the GFS cash flow statement.
3. Equivalent to cash payments for purchases of new and second-hand non-financial assets in the GFS cash flow statement.
4. The acquisition of assets under finance leases decreases the underlying cash balance. The disposal of assets previously held under finance leases increases the underlying cash balance.
5. Excludes expected Future Fund earnings.
6. Under the cash budgeting framework, these cash flows were referred to as net advances.
7. The earnings include the gross proceeds from the sale of Telstra to be transferred to the Future Fund. The Future Fund (excluding Telstra shares) is assumed to earn a rate of return initially equal to the yield on other term deposits held by the Australian Government then increasing to a rate consistent with the benchmark return specified in the Australian Government's investment mandate.

Major new policy decisions and parameter and other variations since the 2006-07 Budget have largely had the same impact on the 2006-07 underlying cash balance as the fiscal balance.

Table 11 provides a reconciliation of the variations in the underlying cash balance estimates.

Table 11: Reconciliation of Australian Government general government sector underlying cash balance estimates

1. Excludes the public debt net interest effect of policy measures.
2. Excludes expected Future Fund earnings.

Total receipts in 2006-07 are expected to be $763 million higher than forecast at the 2006-07 Budget, comprising $591 million in non-tax receipts and $172 million in tax receipts. Similarly to the revisions to the revenue estimates, the revisions to tax receipts are driven by the flow on effects of a lower than expected outcome in 2005-06, broadly offset by higher than expected tax receipts due to an upward revision to nominal economic growth forecasts.

Table 12: Australian Government general government sector receipts

1. The MYEFO estimate includes Medicare levy receipts of $7,090 million in 2006-07.