Supplementary estimates of appropriations

Vote Education Review Office - Supplementary Estimates 2011/12

Publication type:
Supplementary estimates of appropriations
Status:
Superseded
Document (signed) date:
Issue date:
Part of:
Corporate author:
Government of New Zealand
Viewpoint:
Government
Publication category:
Budgets of the government
Copyright:
© Crown Copyright, Attribution 4.0 International (CC BY 4.0)
Fiscal year:
2011/12
Budget year:
2012
Budget vote:
Education Review Office

Formats and related files

MINISTER(S) RESPONSIBLE FOR APPROPRIATIONS: Minister of Education (M26)

ADMINISTERING DEPARTMENT: Education Review Office

MINISTER RESPONSIBLE FOR EDUCATION REVIEW OFFICE: Minister of Education

Details of Appropriations#

Details of Annual and Permanent Appropriations

Details of Annual and Permanent Appropriations - Education Review Office
  2011/12
Titles and Scopes of Appropriations by Appropriation Type Estimates
Budget
$000		 Supplementary
Estimates
Budget
$000		 Total
Budget
$000

Departmental Output Expenses

      

Accountability Reviews MCOA (M26)

 25,780 (177) 25,603
Early Childhood Education Services
This output class is limited to evaluations of the performance of early childhood education services.		 10,182 (272) 9,910
Schools and Other Education Service Providers
This output class is limited to evaluations of the performance of schools and other education service providers.		 15,598 95 15,693

Quality of Education Reports and Services (M26)

This appropriation is limited to the provision of national education evaluation reports, policy services, ministerial and contractual services.		 2,822 553 3,375

Total Departmental Output Expenses

 28,602 376 28,978

Departmental Capital Expenditure

      

Education Review Office - Capital Expenditure PLA (M26)

This appropriation is limited to the purchase or development of assets by and for the use of the Education Review Office, as authorised by section 24(1) of the Public Finance Act 1989.		 1,000 770 1,770

Total Departmental Capital Expenditure

 1,000 770 1,770

Total Annual and Permanent Appropriations

 29,602 1,146 30,748

Details of Projected Movements in Departmental
Net Assets#

Education Review Office

Education Review Office - Details of Projected Movements in Departmental Net Assets - Education Review Office
Details of Net Asset Schedule 2011/12
Main Estimates Projections
$000		 2011/12
Supplementary Estimates Projections
$000		 Explanation of Projected Movements in 2011/12
Opening Balance 3,572 3,746 Supplementary Estimates opening balance reflects the audited results as at 30 June 2011.
Capital Injections - -  
Capital Withdrawals - -  
Surplus to be Retained (Deficit Incurred) - -  
Other Movements - -  

Closing Balance

 3,572 3,746  

Information Supporting the Supplementary Estimates Vote Education Review Office#

MINISTER(S) RESPONSIBLE FOR APPROPRIATIONS: Minister of Education (M26)

ADMINISTERING DEPARTMENT: Education Review Office

MINISTER RESPONSIBLE FOR EDUCATION REVIEW OFFICE: Minister of Education

Part 1 - Summary of the Vote#

Part 1.3 - Trends in the Vote

Summary of Financial Activity

Summary of Financial Activity - Education Review Office
  2011/12
    Supplementary Estimates  
  Estimates
$000		 Departmental
Transactions
$000		 Non-Departmental
Transactions
$000		 Total
Transactions
$000		 Total
$000

Appropriations

          
Output Expenses 28,602 376 - 376 28,978
Benefits and Other Unrequited Expenses - N/A - - -
Borrowing Expenses - - - - -
Other Expenses - - - - -
Capital Expenditure 1,000 770 - 770 1,770
Intelligence and Security Department Expenses and Capital Expenditure - - N/A - -

Total Appropriations

 29,602 1,146 - 1,146 30,748

Crown Revenue and Capital Receipts

          
Tax Revenue - N/A - - -
Non-Tax Revenue - N/A - - -
Capital Receipts - N/A - - -

Total Crown Revenue and Capital Receipts

 - N/A - - -

Part 2 - Details and Expected Performance for Output Expenses#

Part 2.1 - Departmental Output Expenses#

Accountability Reviews MCOA (M26)

Scope of Appropriation

Early Childhood Education Services
This output class is limited to evaluations of the performance of early childhood education services.
Schools and Other Education Service Providers
This output class is limited to evaluations of the performance of schools and other education service providers.

Explanation for Use of Multi-Class Output Expense Appropriation

From 2006/07 a multi-class output expense appropriation called Accountability Reviews was established. This multi-class output expense appropriation aggregates output classes Early Childhood Education Services and Schools and Other Education Service Providers that deliver the same service (education reviews) to two different parts of the education sector (early childhood education services and schools). Both of the output classes use similar resources in working toward the same outcome of ensuring delivery of the highest quality pre-tertiary education to all young New Zealanders. Grouping these will recognise this alignment and allow for more flexibility in resourcing levels across the two.

Expenses and Revenue

Expenses and Revenue - Accountability Reviews MCOA (M26) - Education Review Office
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000

Total Appropriation

 25,780 (177) 25,603
Early Childhood Education Services 10,182 (272) 9,910
Schools and Other Education Service Providers 15,598 95 15,693

Revenue from Crown

 25,368 (177) 25,191
Early Childhood Education Services 10,066 (272) 9,794
Schools and Other Education Service Providers 15,302 95 15,397

Revenue from Other

 412 - 412
Early Childhood Education Services 116 - 116
Schools and Other Education Service Providers 296 - 296

Reasons for Change in Appropriation

The change in appropriation levels between output classes reflect the latest forecasts in output activities.

Quality of Education Reports and Services (M26)#

Scope of Appropriation#

This appropriation is limited to the provision of national education evaluation reports, policy services, ministerial and contractual services.

Expenses and Revenue#

Expenses and Revenue - Quality of Education Reports and Services (M26) - Education Review Office
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 2,822 553 3,375
Revenue from Crown 2,341 301 2,642
Revenue from Other 481 252 733

Reasons for Change in Appropriation#

The change in appropriation level reflects the latest forecasts in output activities.

Part 6 - Details and Expected Results for Capital Expenditure#

Part 6.1 - Departmental Capital Expenditure#

Education Review Office - Capital Expenditure PLA (M26)

Scope of Appropriation

This appropriation is limited to the purchase or development of assets by and for the use of the Education Review Office, as authorised by section 24(1) of the Public Finance Act 1989.

Capital Expenditure

Capital Expenditure - Education Review Office Capital Expenditure PLA (M26) - Education Review Office
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Forests/Agricultural - - -
Land - - -
Property, Plant and Equipment 850 547 1,397
Intangibles 150 223 373
Other - - -

Total Appropriation

 1,000 770 1,770

Reasons for Change in Appropriation

The increase is mainly due to the bringing forward of capital funds from 2010/11 to 2011/12 to enable ERO re-establish itself in Christchurch after its office in the Pyne Gould Building was completely destroyed by the earthquake in February 2011 and timing of software expenditure.

Part 2 - Details and Expected Performance for Output Expenses#

Part 2.1 - Departmental Output Expenses#

Management of Debt and Outstanding Returns (M57)

Scope of Appropriation

Taking action where returns are outstanding and where payments are overdue, including providing people with assistance on the actions they need to take to meet their obligations. This includes collection on behalf of other agencies and external parties.

Expenses and Revenue

Expenses and Revenue - Management of Debt and Outstanding Returns (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 110,765 568 111,333
Revenue from Crown 106,610 568 107,178
Revenue from Other 4,155 - 4,155

Reasons for Change in Appropriation

This appropriation increased by $568,000 for 2011/12 as a result of:

  • an increase in appropriation of $2.730 million for scaling up of the student loan overseas-based borrower initiative
  • an increase in appropriation of $34,000 for the child support scheme reform
  • a return of savings to the Crown related to funding for child support reciprocal cases in Australia of ($2.996 million)
  • a transfer of ($800,000) from 2011/12 to 2012/13 for additional debt compliance activity
  • a transfer of ($400,000) from 2011/12 to 2012/13 for the scaling up of the student loan overseas based borrower initiative
  • a transfer of underspending generated from savings and efficiencies in 2011/12 to 2012/13 of ($2 million), and
  • a fiscally neutral adjustment between departmental output expenses of $4 million.

None of the above appropriation changes affect the output performance standards.

Policy Advice (M57)#

Scope of Appropriation#

Advising on all aspects of tax policy and social policy measures that interact with the tax system. Drafting tax legislation. Negotiating and maintaining New Zealand's network of double tax agreements with other countries. Forecasting tax revenues and providing ministerial services.

Expenses and Revenue#

Expenses and Revenue - Policy Advice (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 15,601 500 16,101
Revenue from Crown 15,434 500 15,934
Revenue from Other 167 - 167

Reasons for Change in Appropriation#

This appropriation increased by $500,000 for 2011/12 as a result of:

  • a fiscally neutral adjustment between departmental output expenses of $500,000.

The above appropriation change does not affect the output performance standards.

Services to Inform the Public About Entitlements and Meeting Obligations (M57)#

Scope of Appropriation#

Providing information and assistance to customers on the application of the law. Responding to customer enquiries about tax and social support programmes. Adjudication on behalf of the Commissioner on proposed taxpayer assessments. Providing binding rulings and other statements on the interpretation and application of the law administered by Inland Revenue.

Expenses and Revenue#

Expenses and Revenue - Services to Inform the Public About Entitlements and Meeting Obligations (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 249,944 1,855 251,799
Revenue from Crown 247,450 655 248,105
Revenue from Other 2,494 1,200 3,694

Reasons for Change in Appropriation#

This appropriation increased by $1.855 million for 2011/12 as a result of:

  • a transfer of $620,000 from 2010/11 to 2011/12 for simplifying filing requirements for individuals and record-keeping requirements for businesses
  • a transfer of $540,000 from 2010/11 to 2011/12 for the enterprise desktop project
  • a transfer of $210,000 from 2010/11 to 2011/12 for Inland Revenue's transformation programme
  • a transfer of $68,000 from 2010/11 to 2011/12 for the child support scheme reform
  • an increase in appropriation for secondments to other agencies of $1.200 million
  • a transfer of ($420,000) from 2011/12 to 2012/13 for the service transformation programme
  • a transfer of ($163,000) from 2011/12 to 2012/13 for simplifying filing requirements for individuals and record-keeping requirements for businesses
  • a transfer of underspending generated from savings and efficiencies in 2011/12 to 2012/13 of ($4.200 million), and
  • a fiscally neutral adjustment between departmental output expenses of $4 million.

None of the above appropriation changes affect the output performance standards.

Services to Process Obligations and Entitlements (M57)#

Scope of Appropriation#

Registering tax payers, making tax assessments, assessing child support liabilities including providing a readily accessible inexpensive process for reviewing assessments, receiving and making payments to customers, processing applications and payments for social support programmes, collection of ACC Earners' levies, supplying information to other government agencies and accounting and reporting the collection of Crown revenue.

Expenses and Revenue#

Expenses and Revenue - Services to Process Obligations and Entitlements (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 122,691 (738) 121,953
Revenue from Crown 98,919 (738) 98,181
Revenue from Other 23,772 - 23,772

Reasons for Change in Appropriation#

This appropriation decreased by ($738,000) for 2011/12 as a result of:

  • a transfer of $2.232 million from 2010/11 to 2011/12 for simplifying filing requirements for individuals and record-keeping requirements for businesses
  • a transfer of $1.260 million from 2010/11 to 2011/12 for the enterprise desktop project
  • a transfer of $490,000 from 2010/11 to 2011/12 for Inland Revenue's transformation programme
  • a transfer of $237,000 from 2010/11 to 2011/12 for the child support scheme reform
  • a transfer of ($577,000) from 2011/12 to 2012/13 for simplifying filing requirements for individuals and record-keeping requirements for businesses
  • a transfer of ($980,000) from 2011/12 to 2012/13 for the service transformation programme
  • a transfer of underspending generated from savings and efficiencies in 2011/12 to 2012/13 of ($1.400 million), and
  • a fiscally neutral adjustment between departmental output expenses of ($2 million).

None of the above appropriation changes affect the output performance standards.

Taxpayer Audit (M57)#

Scope of Appropriation#

Identifying risks to revenue and designing and undertaking audit activities accordingly. Managing litigation of disputed tax cases.

Expenses and Revenue#

Expenses and Revenue - Taxpayer Audit (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 179,785 (8,900) 170,885
Revenue from Crown 177,921 (8,900) 169,021
Revenue from Other 1,864 - 1,864

Reasons for Change in Appropriation#

This appropriation decreased by ($8.900 million) for 2011/12 as a result of:

  • a transfer of underspending generated from savings and efficiencies in 2011/12 to 2012/13 of ($2.400 million), and
  • a fiscally neutral adjustment between departmental output expenses of ($6.500 million).

None of the above appropriation changes affect the output performance standards.

Part 3 - Details for Benefits and Other Unrequited Expenses#

Part 3.2 - Non-Departmental Benefits and Other Unrequited Expenses#

Child Support Payments PLA (M57)

Scope of Appropriation

Child support payments to custodial persons who are not dependent on the state for financial support (expenses incurred pursuant to section 141 of the Child Support Act 1991).

Expenses

Expenses - Child Support Payments PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 226,000 (6,000) 220,000

Reasons for Change in Appropriation

The reduction in the 2011/12 Supplementary Estimates reflects lower than expected income growth. With reduced collections from non-custodial parents, payments to custodial parents have, in turn, been lower than forecast.

Child Tax Credit PLA (M57)#

Scope of Appropriation#

Extra assistance for low to middle income families who are not dependent on the state for financial support (expenses incurred pursuant to section 185 of the Tax Administration Act 1994).

Expenses#

Expenses - Child Tax Credit PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 2,200 (200) 2,000

Reasons for Change in Appropriation#

The child tax credit has not been available to new recipients since April 2006. Existing recipients may continue to receive the credit until they change to the in-work tax credit or otherwise lose eligibility. The appropriation is declining slightly faster than forecasted in Budget 2011.

Family Tax Credit PLA (M57)#

Scope of Appropriation#

Family Support payments made to beneficiaries and non-beneficiaries during the year (expenses incurred pursuant to section 185 of the Tax Administration Act 1994).

Expenses#

Expenses - Family Tax Credit PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 2,168,100 (57,100) 2,111,000

Reasons for Change in Appropriation#

The decline in the 2011/12 Supplementary Estimates reflects lower entitlements than forecasted in Budget 2011. Average payments per recipient decline over time through abatement as incomes grow.

In-Work Tax Credit PLA (M57)#

Scope of Appropriation#

Extra assistance for low to middle income families where the person works a minimum of 20 hours per week and does not have a partner, or a person and their partner work a minimum of 30 hours per week (expenses incurred pursuant to section 185 of the Tax Administration Act 1994).

Expenses#

Expenses - InWork Tax Credit PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 567,000 1,000 568,000

Reasons for Change in Appropriation#

The increase in the 2011/12 Supplementary Estimates reflects that aggregate entitlements will be slightly larger than forecasted in Budget 2011. However, the appropriation is expected to decline in subsequent years through abatement as incomes grow.

KiwiSaver: Interest (M57)#

Scope of Appropriation#

To enable the payment of interest on KiwiSaver contributions as set out in the KiwiSaver Act 2006.

Expenses#

Expenses - KiwiSaver: Interest (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 3,000 4,000 7,000

Reasons for Change in Appropriation#

KiwiSaver interest is payable on member contributions which have not yet been forwarded to scheme providers. Throughout 2011/12 a larger membership base and stronger nominal wage growth have led to an increase in total member contributions received, this has resulted in higher interest expenditure, in excess of that anticipated in Budget 2011.The increase in appropriation reflects this change, and has been carried forward into subsequent years.

KiwiSaver: Kickstart Payment (M57)#

Scope of Appropriation#

To enable the one-off payment made on opening a KiwiSaver account for members who meet the required eligibility criteria as set in the KiwiSaver Act 2006.

Expenses#

Expenses - KiwiSaver: Kickstart Payment (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 209,000 17,000 226,000

Reasons for Change in Appropriation#

The kickstart is a one-off payment to new members on first joining the KiwiSaver scheme. The payment is sensitive to growth in the labour market, promotional efforts from scheme providers, and the proportion of the labour force that has already joined the scheme. Growth in new membership is beginning to ease but with the labour market starting to pick up KiwiSaver kickstart payments have been higher than forecast in Budget 2011.

KiwiSaver: Tax Credit (M57)#

Scope of Appropriation#

To enable the payment of a tax credit to KiwiSaver members and the payment of residual tax credits to employers as set out in the Income Tax Act 2007.

Expenses#

Expenses - KiwiSaver: Tax Credit (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 444,000 31,000 475,000

Reasons for Change in Appropriation#

This appropriation is for member tax credit claims and residual employer tax credits which ceased in 2009. The member tax credit is linked to the level of member contributions made to the scheme and is paid annually. A larger membership base, and stronger nominal wage growth have led to an increase in member tax credit claims.

Minimum Family Tax Credit PLA (M57)#

Scope of Appropriation#

Extra payment made to families where at least one parent is working for salary or wages (expenses incurred pursuant to section 185 of the Tax Administration Act 1994).

Expenses#

Expenses - Minimum Family Tax Credit PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 10,100 900 11,000

Reasons for Change in Appropriation#

There has been an increase in the volume of claims for the minimum family tax credit, leading to an increase in appropriation for 2011/12. This increase has been carried forward into subsequent years.

Scope of Appropriation#

Paid Parental Leave Payments made to parents eligible under the Parental Leave and Employment Protection Act 1987.

Expenses#

Expenses - Paid Parental Leave Payments PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 164,100 (8,100) 156,000

Reasons for Change in Appropriation#

Paid parental leave entitlements reflect both the wages and employment tenure of the parents of newborns. The decrease in the 2011/12 Supplementary Estimates reflects a decline in the number of paid parental leave recipients, and also lower average payments per recipient compared to the prior year.

Parental Tax Credit PLA (M57)#

Scope of Appropriation#

To enable payment of additional financial support to be made to working families for the eight week period following the birth of a child (expenses incurred pursuant to section 185 of the Tax Administration Act 1994).

Expenses#

Expenses - Parental Tax Credit PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 17,600 400 18,000

Reasons for Change in Appropriation#

The change to the 2011/12 Supplementary Estimates reflects minor forecast changes.

Payroll Subsidy (M57)#

Scope of Appropriation#

To enable the payment of a subsidy to a payroll agent undertaking employers' payroll-related tax compliance activities on their behalf.

Expenses#

Expenses - Payroll Subsidy (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 2,000 - 2,000

Part 4 - Details for Borrowing Expenses#

Part 4.2 - Non-Departmental Borrowing Expenses#

Adverse Event Interest PLA (M57)

Scope of Appropriation

This appropriation is limited to interest on Adverse Event Income Equalisation Reserve accounts held by taxpayers in the farming and agriculture business (expenses incurred pursuant to section 185 of the Tax Administration Act 1994).

Expenses

Expenses - Adverse Event Interest PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 10 - 10

Environmental Restoration Account Interest PLA (M57)#

Scope of Appropriation#

This appropriation is limited to interest on Environmental Restoration accounts (expenses incurred pursuant to section 185 of the Tax Administration Act 1994).

Expenses#

Expenses - Environmental Restoration Account Interest PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 2,000 - 2,000

Income Equalisation Interest PLA (M57)#

Scope of Appropriation#

This appropriation is limited to interest on Income Equalisation Reserve Scheme accounts held by taxpayers in the farming, fishing or forestry industries (expenses incurred pursuant to section 185 of the Tax Administration Act 1994).

Expenses#

Expenses - Income Equalisation Interest PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 7,000 - 7,000

Part 5 - Details and Expected Results for Other Expenses#

Part 5.1 - Departmental Other Expenses#

Recovery from February 2011 Christchurch Earthquake (M57)

Scope of Appropriation

This appropriation is limited to writing off, or making good, damage to, departmental assets, maintaining output delivery and re-establishing departmental operations following the Canterbury earthquakes.

Expenses

Expenses - Recovery from February 2011 Christchurch Earthquake (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation - 6,500 6,500
Revenue from Crown - - -
Revenue from Other - 6,500 6,500

Reasons for Change in Appropriation

The increase in appropriation is for building related costs associated with Canterbury earthquakes.

Part 5.2 - Non-Departmental Other Expenses#

Bad Debt Write-Offs (M57)#

Scope of Appropriation

This appropriation is limited to bad debt write-offs for Crown debt administered by Inland Revenue.

Expenses

Expenses - Bad Debt WriteOffs (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 857,000 - 857,000

Impairment of Debt (M57)#

Scope of Appropriation#

This appropriation is limited to amounts relating to impairment arising from objective evidence of one or more loss events that occurred after the initial recognition of the debt, and the loss event (or events) has had a reliably measurable impact on the estimated future cash flows of the Crown debt book.

Expenses#

Expenses - Impairment of Debt (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 247,000 100,000 347,000

Reasons for Change in Appropriation#

This appropriation is for the impairment of tax, family support and KiwiSaver debt. Impairment is linked to the forecast for overdue debt balanced against business initiatives to limit debt growth. The increase in appropriation reflects an allowance for volatility in the debt growth assumptions.

Impairment of Debt Relating to Child Support (M57)#

Scope of Appropriation#

This appropriation is limited to amounts relating to impairment arising from objective evidence of one or more loss events that occurred after the initial recognition of the debt, and the loss event (or events) has had a reliably measurable impact on the estimated future cash flows of the collective book of child support debt.

Expenses#

Expenses - Impairment of Debt Relating to Child Support (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 446,000 (334,000) 112,000

Reasons for Change in Appropriation#

This appropriation is linked to changes in child support debt. System purifications have been substantially completed during 2011/12 to correct child support accounts with incorrect penalties. This has reduced child support penalty revenue and child support debt, which in turn decreases the impairment of child support debt.

Impairment of Debt Relating to Student Loans (M57)#

Scope of Appropriation#

This appropriation is limited to amounts relating to impairment arising from objective evidence of one or more loss events that occurred after the initial recognition of the loan, and the loss event (or events) has had a reliably measurable impact on the estimated future cash flows of the collective book of student loan debt.

Expenses#

Expenses - Impairment of Debt Relating to Student Loans (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 110,000 (244,404) (134,404)

Reasons for Change in Appropriation#

This appropriation has decreased as a result of several policy changes.  These include broadening the definition of income for student loan repayment purposes ($3.486) million, increasing the student loan repayment rate from 10% to 12% ($235.103) million, repealing the student loan voluntary repayment bonus ($1.097) million, and extending the pay period assessments to the salaries and wages of all student loan borrowers ($4.718) million.

Initial Fair Value Write-Down - Student Loans (M57)#

Scope of Appropriation#

This appropriation is limited to the initial fair value write-down of student loans.

Expenses#

Expenses - Initial Fair Value WriteDown Student Loans (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Total Appropriation 128,222 (1,711) 126,511

Reasons for Change in Appropriation#

This appropriation has remained relatively constant.  There have been increases resulting from Budget 2012 policy changes and increased forecast new borrowing. These increases have been largely offset by changes in forecast write-down ratios.

Part 6 - Details and Expected Results for Capital Expenditure#

Part 6.1 - Departmental Capital Expenditure#

Inland Revenue Department - Capital Expenditure PLA (M57)

Scope of Appropriation

This appropriation is limited to the purchase or development of assets by and for the use of the Inland Revenue Department, as authorised by section 24(1) of the Public Finance Act 1989.

Capital Expenditure

Capital Expenditure - Inland Revenue Department Capital Expenditure PLA (M57) - Revenue
  2011/12
  Estimates
$000		 Supplementary
Estimates
$000		 Total
$000
Forests/Agricultural - - -
Land - - -
Property, Plant and Equipment 22,000 2,085 24,085
Intangibles 57,500 16,415 73,915
Other - - -

Total Appropriation

 79,500 18,500 98,000

Reasons for Change in Appropriation

The departmental capital expenditure budget increased during 2011/12 due to timing delays for a number of multi-year projects which resulted in some expenditure being incurred in 2011/12 rather than 2010/11. These projects include enterprise desktop, student loans redesign, and infrastructure technology.