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Australian Government Coat of Arms

Budget | 2015-16

Budget 2015-16
Australian Government Coat of Arms, Budget 2015-16

Part 1: Australia's Federal Relations

Overview

The 2015‑16 Budget is focused on building jobs, growth and opportunity, while making progress in restoring Australia's budget position.

This Budget provides a sound basis from which longer‑term arrangements with the states can be considered in both the Reform of the Federation White Paper, and the White Paper on the Reform of Australia's Tax System.

The Commonwealth is ensuring certainty in service provision in the following key areas:

  • a new two year National Partnership on homelessness to maintain critical frontline homelessness services with a particular focus on women and children experiencing domestic violence, and homeless youth;
  • a two year extension to the National Partnership on universal access to early childhood education to provide affordable, quality early childhood education programmes for all children; and
  • a new five year National Partnership on legal assistance services which extends the current arrangements for Legal Aid Commissions and will provide Commonwealth funding for Community Legal Centres.

This Budget also details the Commonwealth's ongoing commitment to expedite investment in high quality economic infrastructure.

The Commonwealth is continuing its investment in the Northern Territory to address Indigenous disadvantage through an eight year National Partnership on Northern Territory remote Aboriginal investment.

Total payments to the states

The Commonwealth provides substantial levels of funding to the states, in key sectors such as health, education, community services and affordable housing, and continues to support important productivity‑enhancing projects and reforms in the skills and workforce development and infrastructure sectors.

In 2015‑16, the Commonwealth will provide the states with payments totalling $107.7 billion. This represents a $6.0 billion increase compared to 2014‑15. Total payments to the states from 2014‑15 to 2017‑18 have increased by $268 million since the Mid‑Year Economic and Fiscal Outlook 2014‑15. Total payments to the states as a proportion of Commonwealth expenditure are estimated to be 24.8 per cent in 2015‑16.

Payments for specific purposes

In 2015‑16, the Commonwealth will provide the states with $50.0 billion in payments for specific purposes, an increase of $3.4 billion compared with $46.5 billion in 2014‑15. Payments for specific purposes as a proportion of Commonwealth expenditure are estimated to be 11.5 per cent in 2015‑16.

National Specific Purpose Payments (National SPPs), along with National Health Reform and Students First funding are expected to total $36.4 billion in 2015‑16, a change of $2.1 billion from $34.3 billion in 2014‑15.

National Partnership payments are expected to be $13.6 billion in 2015‑16, a change of $1.3 billion from $12.3 billion in 2014‑15.

Part 2 of this Budget Paper provides further information on payments to the states for specific purposes.

General revenue assistance

General revenue assistance, which principally comprises GST entitlements, provides an untied funding base to support the delivery of state services.

In 2015‑16, the states are expected to receive $57.7 billion in general revenue assistance, comprising GST payments of $57.1 billion and other general revenue assistance of $698.9 million. This is an increase of $2.6 billion from $55.2 billion in 2014‑15. Payments for general revenue assistance are estimated to be 13.3 per cent of Commonwealth expenditure in 2015‑16.

Part 3 of this Budget Paper provides further information on general revenue assistance to the states, including GST.

Table 1.1: Commonwealth payments to the states
$million NSW VIC QLD WA SA TAS ACT NT Total
2014‑15                  
Payments for specific purposes(a) 14,324 10,928 9,482 5,817 3,122 1,028 782 1,029 46,530
General revenue assistance(b) 16,942 11,925 11,746 2,289 4,986 1,928 1,136 3,199 55,178
Total payments to the States 31,267 22,853 21,229 8,106 8,109 2,956 1,918 4,227 101,708
2015‑16                  
Payments for specific purposes(a) 14,973 11,659 10,064 5,479 3,516 1,159 786 1,261 49,962
General revenue assistance(b) 17,345 12,755 12,990 1,944 5,518 2,236 1,071 3,335 57,749
Total payments to the States 32,318 24,414 23,054 7,423 9,034 3,394 1,857 4,596 107,711
2016‑17                  
Payments for specific purposes(a) 16,792 11,399 11,399 5,591 3,726 1,188 837 1,073 53,520
General revenue assistance(b) 18,067 13,360 14,946 1,677 6,151 2,336 1,124 3,432 61,660
Total payments to the States 34,859 24,760 26,344 7,269 9,877 3,524 1,961 4,505 115,180
2017‑18                  
Payments for specific purposes(a) 16,219 11,475 11,290 5,761 3,539 1,072 825 962 52,549
General revenue assistance(b) 19,070 14,135 16,483 1,366 6,565 2,450 1,219 3,351 65,149
Total payments to the States 35,289 25,610 27,773 7,127 10,104 3,523 2,044 4,314 117,698
2018‑19                  
Payments for specific purposes(a) 16,602 11,744 10,609 5,786 3,744 1,080 810 748 52,220
General revenue assistance(b) 20,235 15,075 17,346 1,626 6,797 2,516 1,282 3,459 68,745
Total payments to the States 36,836 26,819 27,955 7,412 10,541 3,595 2,091 4,207 120,964

(a) As state allocations for a small number of programmes have yet to be determined, these payments are not reflected in state totals. As such, total payments for specific purposes may not equal the sum of state totals.

(b) As state allocations for royalties are not published due to commercial sensitivities, these payments are not reflected in state totals. As such, total general revenue assistance will not equal the sum of the state totals.

For 2015‑16, total payments to the states as a proportion of GDP are estimated to be 6.5 per cent, with payments for specific purposes estimated to be 3.0 per cent and general revenue assistance estimated to be 3.5 per cent.

Table 1.2: Total Commonwealth payments to the states as a proportion of GDP
$million National
SPPs
National Health
Reform funding (a)
Students First
funding (b)
National Partnership
payments (c)
GST
entitlement
Other general
revenue assistance
Total Per cent change
from prior year
Per cent
of GDP
2014‑15 4,135 15,459 14,664 12,272 54,000 1,178 101,708 - 6.3
2015‑16 4,222 16,441 15,743 13,557 57,050 699 107,711 5.9 6.5
2016‑17 4,318 17,382 17,012 14,807 60,950 710 115,180 6.9 6.6
2017‑18 4,423 18,103 18,031 11,992 64,500 649 117,698 2.2 6.4
2018-19 4,534 18,873 18,760 10,052 68,200 545 120,964 2.8 6.2

(a) New indexation arrangements for public hospital funding will apply from July 2017.

(b) New indexation arrangements for schools funding will apply from January 2018.

(c) Includes financial assistance grants for local government and payments direct to local government.