Financial management

During 2007-08, the department's statutory financial management obligations were met including preparation of a comprehensive set of financial statements which reflect the financial performance of the department. A full set of these financial statements is provided in this report.

Supporting the department's goals and initiatives by broadening existing, and identifying new, funding opportunities; further maximising financial returns and ensuring value for Government investment; and continuing to minimise operating costs

The department's funding base was broadened through a $500 million five-year funding injection from the Queensland Future Growth Fund for social housing, together with $60 million over four years for improved housing provision for rural and remote Aboriginal and Torres Strait Islander communities.

Ensuring value for Government investment was enhanced through the ongoing application of sound asset management strategies, including the use of property condition data to inform maintenance and upgrade programs so as to extend the useful life of the social housing portfolio.

The Finance and Risk Management Steering Committee has overseen the management of departmental resources through an effective financial management framework which includes a rigorous annual resource allocation process and monthly examination of the department's financial performance.

Renegotiating funding agreements with the Australian Government

The 2003-2008 Commonwealth State Housing Agreement provided a significant portion of the department's funding and was due to expire on the 30 June 2008. However, following the change of Federal Government in November 2007, it was extended to 31 December 2008 to enable finalisation of a new funding agreement between the states and the Australian Government. The new agreement, the National Affordable Housing Agreement, will commence on 1 January 2009.

Overview

The department delivered its six outputs within the overall limits of available revenue sources including record housing assistance expenditure through the provision of capital works, grants and maintenance. At the same time, the department has continued to maintain its strong net asset position, as detailed below.

Balance sheet	2005–06	2006–07	2007–08
Total assets ($'000)	10,839,861	11,824,813	13,951,157
Total liabilities ($'000)	501,400	496,368	495,999
Net assets ($'000)	10,338,362	11,328,445	13,455,158
Capital expenditure ($'000)	351,103	373,415	368,505
Percentage of liabilities to assets	5%	4%	4%
Growth in net assets ($'000)	1,030,246	990,083	2,126,713

Income

The department's main income sources comprise:

• rental revenue from the department's property portfolio,
• funding from the Queensland Government (including the State's funding under the Commonwealth State Housing Agreement), and
• funding from the Australian Government (under the Commonwealth State Housing Agreement).

Expenses

The major costs to deliver each output include supplies and services (such as maintenance on housing stock and rates paid to local governments), providing grants for housing assistance and employee expenses.

Income statement	2005–06	2006–07	2007–08
Income ($'000)	649,172	670,140	676,282
Expenses ($'000)	560,600	588,401	626,309

Sources and applications of funds

The extent of the department's sources of funds and application of funds are detailed on the following charts:

How each dollar was raised in 2007-08

* Includes proceeds from the sale of land inventories and proceeds from the sale of the department's share in Rental Purchase Plan properties.

How each dollar was spent in 2007-08

2008-2013

The department will:

• maintain a financial management framework that supports the department's strategic direction, maximises financial returns, and ensures value for Government investment,
• optimise funding availability through identifying new funding opportunities and broadening existing arrangements, and
• provide and promote a strong focus on financial performance.