Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
 Download Full Day's HansardDownload Full Day's Hansard    View Or Save XMLView/Save XML

Previous Fragment    Next Fragment
Tuesday, 19 August 1980
Page: 320

As is evident from Table 1, financing transactions involve the issue, repurchase, redemption or acquisition of Commonwealth Government securities, or involve changes in other assets or liabilities of the Commonwealth Government. A reconciliation of the deficit with the net movement in securities on issue can therefore be made. (Details of securities on issue are published in Budget Paper No. 6.)

For this purpose, total financing can be disaggregated as:

Net sales of Commonwealth Government securities (new issues, less redemptions, less net purchases from balances'1' in the Trust Fund), less net purchases of other investments from Commonwealth Government balances in Trust Fund, plus other items of indebtedness (such as transactions of superannuation funds, and transactions associated with the issue of coin), less net additions to cash balances and borrowings from the Reserve Bank.

Table 3 - Reconciliation of 1979-80 Deficit with Net Movement in Securities on Issue ($ million)

Net movement in securities on issue......... 1 697

Lessnet increase in securities on issue held by Trust Fund(a)..... 452


Plusadjustment from face value to cash basis(A)....... - 174


Lessincreases in net assets of Commonwealth Government -

Cash balances............ -635

Other(a)............. -328

Deficit............. 2 034

(a)   Excludes investment of other than Commonwealth Government balances in the Trust Fund. (2>) Includes adjustment of Australian currency equivalent of overseas debt following variations in rates of exchange; see page 24 of Government Securities on Issue at 30 June 1980.

(1)   A distinction is drawn in this connection between Commonwealth Government and other balances in the Trust Fund. Commonwealth Government balances are those which record the receipt, expenditure and investment of Commonwealth Government money, while other balances are those which record moneys held in trust and invested on behalf of other sectors. The latter include the insurance deposits fund and a number of smaller funds; their transactions do not affect the size of the deficit, as any increase in liability for moneys received is matched by purchases of investments or additions to cash balances.

Suggest corrections