Financial Performance of Government Trading Enterprises, 2004-05 to 2006-07
Productivity Commission Research Paper, July 2008
362 Pages Posted: 3 Jun 2010
Date Written: July 31, 2008
Abstract
While the overall profitability of GTEs increased in 2006-07, a new Commission report finds that just over half the monitored GTEs still failed to achieve a commercial rate of return. Government Trading Enterprises (GTEs) are major providers of infrastructure services and contribute significantly to Australia’s international competitiveness and community well-being. It is important that they operate efficiently.
In cooperation with Australian, State and Territory Governments, the Productivity Commission has undertaken a series of reports on the financial performance of GTEs. The latest of these reports, covering the period 2004-05 to 2006-07, was released in July. The report also includes an examination of the impact on capital management of inadequate compensation for community service obligations and of the persistently poor profitability of some GTEs.
The report covers the financial performance of 86 GTEs providing services in key sectors of the economy – electricity, water, urban transport, rail, ports and forestry. In 2006-07, these GTEs controlled about 2.8 per cent of Australia’s non-household assets (valued at $192 billion) and accounted for around 1.7 per cent of GDP.
Keywords: Electricity, harbours, forestry, Public finance, government business enterprises, Transport, Water supply, rail transport
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