Hawker Britton Occasional Papers and Media

Productivity Commission Research Paper

Financial Performance of Government Trading Enterprises (GTEs), 2000-01 to 2004-05

August 2006

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The Research Paper is the first in a new program of GTE monitoring to provide information on the performance of Australian industries and the progress of microeconomic reform. It is suitable for making a general assessment of financial performance within and across sectors and for providing a baseline for measuring further improvements as reforms are implemented. The existence of the Paper also increases transparency and strengthens accountability.

Scope of the Paper:

The report covers 86 GTEs over the period 2000-01 to 2004-05. This represents the majority of the GTEs currently operating. In 2004-05 these GTEs controlled assets valued at more than $186 billon and generated $63 billion in revenue. The monitored GTEs represent the electricity, water (sewerage, drainage and irrigation), urban transport (railways and ports) and forestry sectors. Australia Post, Airservices Australia and Telstra are also analysed.

Contents of the Paper:

Key Findings:

Profitability
2000-01 to 2004-05
2003-04 to 2004-05
Debt Levels
Government Transactions
Equity Withdrawals
Community Service Obligations (CSOs)
Factors Affecting Financial Performance Specific to GTEs:
Government ownership and borrowing arrangements reduce the incentives to maximise shareholder return and operational efficiency which flow from appropriate capital structures and market engagement.
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