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Australian Government Coat of Arms

Budget | 2015-16

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

Part 2: Payments for Specific Purposes

Overview of payments

The Commonwealth provides payments to the states for specific purposes in areas administered by the states. These payments cover most functional areas of state and local government activity, including health, education, skills and workforce development, community services, housing, Indigenous affairs, infrastructure and the environment.

The Commonwealth currently supports the states in certain service delivery sectors through three National Specific Purpose Payments (National SPPs) — Skills and Workforce Development, Disability Services and Affordable Housing. The states are required to spend each National SPP in the relevant sector.

The National SPPs are ongoing and are indexed each year by growth factors specified in the Intergovernmental Agreement on Federal Financial Relations (the Intergovernmental Agreement). They are distributed amongst the states in accordance with population shares based on the Australian Statistician's determination as at 31 December of that year.

The Commonwealth also supports the states through the provision of public hospitals funding. This funding is currently calculated by reference to the level of estimated efficient growth in hospital activity in each state. From 1 July 2017, public hospitals funding will be indexed by Consumer Price Index (CPI) and population growth. Further details are included in the Health section of this Part.

The Commonwealth further supports the states through the provision of recurrent funding for all government and non‑government schools. From 1 January 2018, recurrent schools funding will be indexed by CPI, with an allowance for changes in enrolments. Further details are included in the Education section of this Part.

Under the Intergovernmental Agreement, National Partnership payments to the states are the key vehicle to facilitate reforms or support the delivery of specified projects. National Partnerships are typically entered into for a fixed period of time, reflecting the nature of the project or reform involved.

To the fullest extent possible, payments are aligned with the achievement of project milestones and are made after the states have achieved the outcomes or outputs specified in the relevant National Partnership.

National Partnership agreements are publicly available at: www.federalfinancialrelations.gov.au.

Total payments for specific purposes

Total payments for specific purposes by category are shown in Table 2.1.

Table 2.1: Total payments for specific purposes by category, 2014‑15 to 2018‑19
$million NSW VIC QLD WA SA TAS ACT NT Total(a)
2014‑15                  
National Specific Purpose Payments 1,323 1,029 831 455 296 90 68 43 4,135
National Health Reform funding 4,878 3,848 3,057 1,756 1,125 334 305 158 15,459
Students First funding 4,539 3,670 3,040 1,474 1,075 350 253 260 14,664
National Partnership payments(b) 3,585 2,381 2,554 2,132 627 255 156 567 12,272
Total payments for specific purposes 14,324 10,928 9,482 5,817 3,122 1,028 782 1,029 46,530
2015‑16                  
National Specific Purpose Payments 1,346 1,052 850 471 299 91 69 44 4,222
National Health Reform funding 5,243 4,104 3,229 1,823 1,198 349 321 175 16,441
Students First funding 4,826 3,932 3,329 1,591 1,141 370 268 284 15,743
National Partnership payments(b) 3,557 2,572 2,657 1,594 878 349 127 758 13,557
Total payments for specific purposes 14,973 11,659 10,064 5,479 3,516 1,159 786 1,261 49,962
2016‑17                  
National Specific Purpose Payments 1,372 1,077 870 488 304 91 71 45 4,318
National Health Reform funding 5,553 4,316 3,408 1,955 1,253 359 344 194 17,382
Students First funding 5,250 4,226 3,628 1,702 1,212 397 286 310 17,012
National Partnership payments(b) 4,617 1,780 3,493 1,446 957 340 137 524 14,807
Total payments for specific purposes 16,792 11,399 11,399 5,591 3,726 1,188 837 1,073 53,520
2017‑18                  
National Specific Purpose Payments 1,401 1,104 892 506 309 92 72 47 4,423
Public hospitals funding 5,735 4,518 3,649 2,072 1,265 378 296 190 18,103
Students First funding 5,552 4,472 3,808 1,900 1,287 407 299 304 18,031
National Partnership payments(b) 3,530 1,381 2,941 1,283 679 196 158 421 11,992
Total payments for specific purposes 16,219 11,475 11,290 5,761 3,539 1,072 825 962 52,549
2018‑19                  
National Specific Purpose Payments 1,432 1,133 915 526 314 93 74 48 4,534
Public hospitals funding 5,960 4,714 3,808 2,187 1,308 388 308 199 18,873
Students First funding 5,705 4,675 3,916 2,093 1,356 409 313 292 18,760
National Partnership payments(b) 3,505 1,222 1,971 980 765 190 114 209 10,052
Total payments for specific purposes 16,602 11,744 10,609 5,786 3,744 1,080 810 748 52,220

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

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

Total payments for specific purposes by sector are shown in Table 2.2.

Table 2.2: Total payments for specific purposes by sector, 2014‑15 to 2018‑19
$million 2014‑15 2015‑16 2016‑17 2017‑18 2018‑19
Health 16,804 17,184 17,690 18,308 19,045
Education 15,450 16,365 17,585 18,458 18,800
Skills and workforce development 1,835 1,833 1,996 1,504 1,529
Community services 2,344 2,511 1,907 2,131 3,722
Affordable housing 1,973 1,858 1,916 1,780 1,392
Infrastructure 4,901 6,823 9,245 7,436 4,860
Environment 599 775 590 267 111
Contingent 37 33 5 ‑1 ‑1
Other(a) 2,585 2,580 2,586 2,666 2,762
Total payments for specific purposes 46,530 49,962 53,520 52,549 52,220

(a) Includes financial assistance grants for local government.

Total payments for specific purposes by sector and category are shown in Table 2.3.

Table 2.3: Total payments for specific purposes by sector and category, 2014‑15 to 2018‑19
$million 2014‑15 2015‑16 2016‑17 2017‑18 2018‑19
Health        
National Health Reform funding 15,459 16,441 17,382
Public hospitals funding - - 18,103 18,873
National Partnerships 1,345 743 308 205 172
Total health payments 16,804 17,184 17,690 18,308 19,045
Education        
Students First funding 14,664 15,743 17,012 18,031 18,760
National Partnerships 786 623 573 427 40
Total education payments 15,450 16,365 17,585 18,458 18,800
Skills and workforce development        
National Skills and Workforce Development SPP 1,435 1,455 1,480 1,504 1,529
National Partnerships 400 377 516
Total skills and workforce development payments 1,835 1,833 1,996 1,504 1,529
Community services        
National Disability SPP(a) 1,394 1,442 1,493 1,552 1,617
National Partnerships 951 1,069 413 579 2,105
Total community services payments 2,344 2,511 1,907 2,131 3,722
Affordable housing        
National Affordable Housing SPP 1,306 1,324 1,345 1,367 1,389
National Partnerships 668 534 571 413 4
Total affordable housing payments 1,973 1,858 1,916 1,780 1,392
Infrastructure        
National Partnerships 4,901 6,823 9,245 7,436 4,860
Environment        
National Partnerships 599 775 590 267 111
Contingent payments        
National Partnerships 37 33 5 ‑1 ‑1
Other        
National Partnerships(b) 2,585 2,580 2,586 2,666 2,762
Total payments for specific purposes 46,530 49,962 53,520 52,549 52,220

(a) Does not include National Disability SPP adjustments to achieve budget neutrality as this is still subject to negotiation (see footnotes to Table 2.7 in this Part for further details).

(b) Includes financial assistance grants for local government.

Further information on each of these payments is contained in this Part. New measures associated with payments to the states are included in Budget Paper No. 2, Budget Measures 2015‑16.

Total payments to the states for specific purposes, as categorised by Government Finance Statistics function, are set out in Appendix B, which is available online.