The recent Victorian State Budget offers many business opportunities for industry. To assist with identifying these, Mia has developed the Mia State Budget Survey 2016 – available as a free download.
On 27 April 2016 Victoria’s Treasurer, the honourable Mr Tim Pallas, announced the Victorian Government’s State Budget for 2016 to 2017.
By now we are familiar with the focus of the budget, which is on hospitals, schools, jobs and transport. The budget also has a strong social focus, with $500M set aside to implement the most urgent recommendations of the Family Violence Royal Commission, mental health services and the continued focus on combating drugs. In total, more than $12 billion has been allocated to new capital investment in this budget.
However, far from being a budget for larger businesses there are many, many opportunities for businesses of all sizes.
The budget significantly extends funds for a number of government grants that we have previously discussed in our blogs — including the public sector innovation fund, market sector growth fund, and $111M for the government’s eight priority sector strategies. All of these investments target businesses of all sizes, particularly small to medium sized enterprises (SMEs).
Finally, there are large allocations for building a ‘creative’ Victoria, focusing on the Victorian screen industry (film and gaming), regional and metropolitan cultural events, and the development of regional arts precincts. Funding for Victoria’s creative state strategy comprises 42 new actions that support the sustainability and growth of creative industries, including Aboriginal arts and culture, establishment of a Creators Fund, landmark artworks, talent development and screen professional development.
In fact, it’s hard to think of industry sectors that aren’t represented under this state budget.
The Mia State Budget Survey
So how do you discover all the business opportunities buried within this State Budget? Budget Paper no. 3, which describes each individual budget initiative, is around 370 pages, including 29 tables with a total of 387 line items.
To make it easier for our clients, we have collated each budget initiative from Budget Paper no. 3 into a series of easy-to-read tables and graphs in Microsoft Excel. This inaugural Mia State Budget Survey 2016 is available now as a free download.
The Mia State Budget Survey 2016 re-presents the output and asset initiatives tables from Budget Paper no. 3 under a series of sheet tabs. Following the tables is a series of graphs that show in bar charts the size of the spend for each initiative, to aid in assessing the relative importance of the initiatives. (See below for definitions of output and asset initiatives.)
To understand the government opportunities for your business in the budget, it’s very important that you first target the department or agency, or portfolio you want to work in. Once you have targeted this you can read the initiatives in the relevant table.
For example, if you are a civil construction business, you may be interested how you can support the many roads and rails projects. An environmental consultancy may also be interested in rail projects, as well a number of initiatives listed under the Department of Environment, Land, Water and Planning. Medical equipment suppliers would look at Department of Health opportunities and new hospital builds, etc.
We have also prepared an expanded version of the Mia State Budget Survey 2016, which includes additional sheets providing deeper analysis of how the budget initiatives will generate procurements for specific industries and their sub-segments and businesses. For more information about how you can obtain a copy of this expanded version of the Mia State Budget Survey 2016, contact firstname.lastname@example.org or call 1300 123 MIA.
Notes on reading the State Budget
The State Budget is documented in a series of statements referred to as The Budget Papers. Here is the list of papers that can be downloaded from www.budget.vic.gov.au.
- Budget Paper no. 1 – Treasurer’s Speech
- Budget Paper no. 2 – Strategy and Outlook
- Budget Paper no. 3 – Service Delivery
- Budget Paper no. 4 – State Capital Program
- Budget Paper no. 5 – Statement of Finances
Budget Paper no. 3 is the most important document, in that it describes each individual budget initiative. This paper describes the funding in terms of the output and asset initiatives each Department and Whole of Government team will deliver over the next five years.
An output initiative describes the service, project or scope of work that will be undertaken by the government to deliver a result (or output). An output may be a single or a group of services to the public. In commercial terms it equates roughly to the ‘operational expense’ for establishing the result.
Some of the outputs government wishes to achieve will require the establishment of an asset. Assets tend to be items that are constructed or purchased to provide a government service output. The asset initiatives include a dollar value on the investments government will make over the coming years to create these assets. In commercial terms it equates roughly to what would be seen as the ‘capital expense’ for establishing the asset, which in turn may contribute to an output.
Another term that appears in the asset initiative tables is the Total Estimated Investment (TEI). The TEI represents an estimate of the funds required to complete the acquisition or construction of a government asset. The TEI represents the full amount of funding required to complete construction over the full period of that construction. The TEI may include funding from different sources such as State and Commonwealth funding contributions.