This part provides an overview of the NBA's financial management and outcome in 2011-12.
The functions of the NBA are outlined in the National Blood Authority Act 2003 and the National Blood Agreement. As a material statutory agency, the NBA has a range of corporate and compliance responsibilities under the National Blood Authority Act 2003, the Financial Management and Accountability Act 1997, and the Public Service Act 1999, along with a responsibility to meet ministerial, parliamentary and financial reporting requirements.
Under the National Blood Agreement between the Australian Government and the states and territories, 63 per cent of NBA funding is provided by the Australian Government and the remaining 37 per cent is provided by the state and territory governments. The funding covers both the national blood supply and the operations of the NBA.
The NBA operates through two special accounts, the National Blood Account and the National Managed Fund (Blood and Blood Products) Special Account.
Special accounts are held in the Consolidated Revenue Fund and are used for setting aside and recording amounts to be used for specified purposes. Funding received from the Australian Government and the states and territories is held within the special accounts and expended as required.
Funding for the supply of blood and blood products and the operation of the NBA is included in the National Blood Account, established under section 40 of the National Blood Authority Act 2003.
The NMF (Blood and Blood Products) Special Account was established under section 20 of the Financial Management and Accountability Act 1997 to accumulate funds required to meet potential product liability claims against the Blood Service. Contributions to the account are made by all governments and the Blood Service. In addition, interest is received on special account balances.
For budgeting and accounting purposes, the NBA's financial transactions are classified as either departmental or administered revenues or expenses:
Transactions in the National Blood Account are separated into departmental and administered components. All balances in the NMF (Blood and Blood Products) Special Account are administered funds.
The NBA's agency resource statement and total resources for outcome tables are given in Appendix 3. Table 7.1 summarises the NBA's revenue and expenditure for 2011-12.
| Funding Incl. Appropriations ($M) |
Expenditure ($M) |
|
|---|---|---|
| Departmental-NBA Operations | 9.716 | 10.380 |
| Administered-national blood and blood product supply | 1,034.910 | 955.884 |
This section provides a summary of the NBA's financial performance for 2011-12. Details of departmental and administered results are shown in the audited financial statements (see pages 122-173), and this summary should be read in conjunction with those statements.
The NBA received an unqualified audit report for 2011-12.
The NBA's departmental finances cover the NBA's operations.
Funding for the NBA since 2005-06 has been provided to build capacity, particularly for risk management, appropriate PBM and the safe use of blood and blood products.
Although all planned initiatives in these areas were well under way, several factors caused delays in implementation. As a result, funds provided for these initiatives were not fully spent in earlier years.
As foreshadowed in last year's annual report, in 2011-12 the unspent funds were drawn on to meet the staffing and other costs of completing these initiatives, and thus an operating deficit was incurred. The deficit was approved by the Minister for Finance and Deregulation.
Staffing and other costs will be managed to match the level of funding provided for 2012-13.
The NBA's income statement reports a 2011-12 operating deficit of $0.664 million, compared with an operating surplus of $0.238 million in 2010-11. Table 7.2 shows the key results for the period 2008-09 to 2011-12.
| REVENUE AND EXPENSES | 2011-12 ($M) |
2010-11 ($M) |
2009-10 ($M) |
2008-09 ($M) |
|---|---|---|---|---|
| Contributions from the Australian Government | 5.686 | 5.948 | 5.712 | 5.865 |
| Contributions from States and Territories and other revenue | 4.030 | 4.074 | 3.812 | 3.989 |
| Total revenue | 9.716 | 10.022 | 9.524 | 9.854 |
| Employee expenses | 6.776 | 5.869 | 5.636 | 6.162 |
| Supplier expenses | 2.840 | 3.114 | 2.677 | 2.709 |
| Other expenses | 0.764 | 0.801 | 1.162 | 0.878 |
| TOTAL EXPENSES | 10.380 | 9.784 | 9.475 | 9.749 |
| Operating result | (0.664) | 0.238 | 0.049 | 0.105 |
Total departmental revenue received in 2011-12 amounted to $9.716 million: $5.686 million in funding from the Australian Government; $3.936 million in contributions received from the states and territories and other revenue; and $0.094 million for resources received free of charge. This represents a decrease of $0.306 million (-3.1 per cent) on revenue received in 2010-11. Other revenue refers to contributions arising from officers transferring from other agencies and the use of funds provided in earlier years for specific projects.
The NBA's expenses for 2011-12 amounted to $10.380 million, six per cent higher than in 2010-11.
Details of the NBA's assets and liabilities are presented in the audited financial statements in this report.
The NBA held cash of $0.030 million at 30 June 2012. Funds received from all jurisdictions are transferred to the Official Public Account held by the Department of Finance and Deregulation until required for expenditure. In the NBA's financial statements these funds are classified as a receivable.
The reduction in the carrying amount of non-financial assets largely results from the depreciation of infrastructure and plant and equipment, particularly information technology equipment and furniture and fittings.
Payables to suppliers and other payables decreased by $1.129 million, down from $1.9 million in 2011.
Employee provisions, which cover annual and long service leave entitlements, remained constant at $1.2 million.
On behalf of the Australian Government, the NBA manages and coordinates the Australian blood supply in accordance with the National Blood Agreement between the Australian Government and state and territory governments. This includes negotiating and managing national contracts with suppliers of blood and blood products on behalf of all governments.
On behalf of the Australian Government, the NBA manages and coordinates the Australian blood supply in accordance with the National Blood Agreement between the Australian Government and state and territory governments. This includes negotiating and managing national contracts with suppliers of blood and blood products on behalf of all governments.
A key contributor to the surplus generated on administered schedule of comprehensive income was the continued improvements in value for money through its purchasing activities for blood and blood products: new contracts for imported plasma-derived and recombinant clotting factor products commenced in July 2011, generated net savings of $35.05 million. The Blood Service also delivered savings across its operations during 2011-12.
Total revenue for 2011-12 is presented in Table 7.3. Because funding is provided to meet the cost of supplying blood and blood products, the increase of $76.4 million in funding (eight per cent, the same as last year) for the current financial year reflects the increasing demand for products and contractually agreed increases in prices.
| ADMINISTERED REVENUE | 2011-12 ($M) |
2010-11 ($M) |
2009-10 ($M) |
2008-09 ($M) |
|---|---|---|---|---|
| Funding for supply of blood and blood products | 1,015.586 | 939.212 | 871.195 | 827.640 |
| Total administered revenues | 1,034.910 | 941.016 | 872.549 | 829.190 |
Table 7.4 shows the NBA's administered expenses for 2008-09 to 2011-12.
| ADMINISTERED EXPENSE | 2011-12 ($M) |
2010-11 ($M) |
2009-10 ($M) |
2008-09 ($M) |
|---|---|---|---|---|
| Grants to the private sector- non-profit organisation | 7.773 | - | 456.881 | 433.385 |
| Rendering of goods and services-external entities | 947.820 | 937.954 | 402.143 | 356.568 |
| Other | 0.291 | 0.310 | 0.128 | 3.103 |
| Total administered expenses | 955.884 | 938.264 | 859.152 | 793.056 |
Administered expenses for 2011-12 increased by 1.9 per cent over those for 2010-11. Total payments to commercial suppliers decreased by 0.1 per cent while payments to the Blood Service increased by six per cent.
Administered assets comprise the following:
Administered liabilities comprise payables to suppliers.
As a result of the surplus described above, net administered assets increased by $86.7 million during 2011-12.