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5220.0 - Australian National Accounts: State Accounts, 2005-06 Reissue  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 13/11/2006  Reissue
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RE-ISSUE

This publication has been re-issued to correct errors detected in the release of this publication on Friday 10 November. The re-issue contains corrected data in Tables 1, 2, 5, 7, 9, 11, 13, 15, 17 and 19. The corrections apply to the series Gross State Product (volume terms only), Real Gross State Income, Total final consumption expenditure (volume terms only), State Final Demand (volume terms only) and Balancing item (volume terms only). Associated time series data files have also been re-issued.




NOTES


ABOUT THIS PUBLICATION

This publication contains state and territory estimates of gross domestic product (referred to as gross state product (GSP)) and its components, in current price and volume terms, for the years 1997-98 to 2005-06.



REVISIONS IN THIS ISSUE

The estimates in this issue incorporate new and revised estimates from the annual supply and use tables for 2002-03 to 2004-05 and updated data from other sources which normally become available by this time each year. All states are affected by these revisions, although the extent to which each state is affected varies.



CHANGES IN THIS ISSUE

Changes have been made to the Agriculture Income table to include a component for the Australian Capital Territory. Previously Australian Capital Territory agriculture income estimates were combined with New South Wales.


With the release of this publication, the Lotus 1-2-3 .wks spreadsheets have been discontinued and replaced with Excel .xls spreadsheets. The Information Paper: Changes to spreadsheets for the Annual State Accounts, 2004-05 (cat. no. 5220.0.55.001) outlined the proposed changes.


Following feedback on the Information Paper, a number of minor changes have been made to the Excel spreadsheets. Total Gross operating surplus for each state has been included in spreadsheets 2 - 8 and for Australia in spreadsheet 9. In spreadsheet 2 Total household final consumption expenditure for NSW had been omitted and was included. No other state was affected. Spreadsheet 9 has had its title altered from Gross state product to Gross domestic product.



DATA VALUES AND ROUNDING

All values, unless otherwise indicated, are shown in Australian dollars rounded to the nearest million.


Where figures have been rounded, discrepancies may occur between the sums of the component items and totals.



NEXT ISSUE

The 2006-07 issue of this publication is expected to be released in November 2007.



INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or Robert Reilly on Canberra (02) 6252 5892.



ANALYSIS OF RESULTS


GROWTH IN EXPERIMENTAL GSP VOLUME MEASURES

The volume measure of gross state product (GSP) in 2005-06 increased in all states. Northern Territory experienced the strongest growth (up 7.5%) followed by Western Australia and Queensland (each up 4.9%). Growth in New South Wales, South Australia and Victoria were below the Australian GDP growth rate of 2.8%.

GSP, Chain volume measures - 2005-06

Annual growth
Average annual compound growth rates (1995-96 to 2005-06)
%
%

New South Wales
1.4
2.9
Victoria
2.7
3.6
Queensland
4.9
5.0
South Australia
2.2
2.7
Western Australia
4.9
4.3
Tasmania
3.1
2.1
Northern Territory
7.5
3.3
Australian Capital Territory
3.4
2.8
Australia(a)
2.8
3.6

(a) Gross domestic product.


All states were positive contributors to Australia's GDP growth in 2005-06. The highest contributions to GDP growth were from Queensland (0.9 percentage points), Victoria (0.7 percentage points) and Western Australia (0.6 percentage points).


The volume estimates of GSP included in this publication are derived indirectly. The method involves deriving a price deflator from the best possible current price and chain volume estimates of expenditure that encompass as much as possible of GSP. This deflator is then applied to current price income estimates of GSP. The volume estimates are labelled as 'experimental' for reasons set out in the Explanatory Notes (paragraphs 30 to 34). Users should therefore exercise caution when using these estimates for economic analysis.


Given these measurement issues, the ABS is currently developing estimates of GSP using the production approach. The ABS believes that better quality volume estimates of GSP can be produced using this approach. Experimental estimates using the new approach are expected to be released during 2007.



GSP PER CAPITA

For some analytical purposes it is important to allow for the impact of population growth on movements in GSP. The annual growth in GSP per capita was lower than GSP growth for all states.


Five states showed growth rates in GSP per capita that were stronger than the Australian growth rate of 1.5%. Northern Territory (up 5.4%) showed the showed the strongest growth in GSP per capita, with Western Australia (up 3.0%) the next highest. New South Wales had the weakest growth in GSP per capita of 0.5%.

GSP per capita, Chain volume measures - 2004-05 to 2005-06
Graph: GSP per capita, Chain volume measures—2004–05 to 2005–06




REAL GROSS STATE INCOME

Volume estimates of GSP measure the volume of goods and services produced in each state. If the terms of trade for a state change significantly (i.e. the prices for a state's exports and imports change at different rates) then GSP will not accurately reflect the change in real purchasing power of the income generated within a state. For this reason, estimates of real gross state income (RGSI) are calculated which include an adjustment for the terms of trade. (For details on the calculation method see the Explanatory Notes, paragraphs 35 to 37).


The following graph shows annual percentage changes in RGSI per capita in 2005-06. All states, except the Australian Capital Territory, experienced a growth in RGSI per capita stronger than GSP per capita in 2005-06. This follows the recent national trend of favourable movements in the terms of trade. In the past year the continued improvement in the terms of trade has been led by strong rises in prices for mineral resources. Consequently, the impact of the terms of trade adjustment can be seen to have more significantly affected Western Australia, Northern Territory and Queensland. These are all states in which mining is an important contributor to economic activity.

RGSI per capita, Chain volume measures - 2004-05 to 2005-06
Graph: RGSI per capita, Chain volume measures—2004–05 to 2005–06




STATE FINAL DEMAND (SFD)

Volume growth in state final demand was positive in all states in 2005-06 with the strongest growth in Western Australia (up 10.9%), Northern Territory (up 6.5%) and Queensland (up 6.1%). Growth in these states was driven by strong growth in private gross fixed capital formation.


South Australia (up 1.4%), New South Wales (up 2.2%) and Victoria (up 3.1%) experienced growth in state final demand below the 4.2% growth in national domestic final demand.

State final demand, Chain volume measures(a) - 2005-06

LEVELS
2004-05
2005-06
SFD growth
Contribution to DFD
$m
$m
%
% pts

New South Wales
300 032
306 648
2.2
0.7
Victoria
225 811
232 785
3.1
0.8
Queensland
171 368
181 791
6.1
1.1
South Australia
64 326
65 242
1.4
0.1
Western Australia
91 916
101 904
10.9
1.1
Tasmania
18 962
19 860
4.7
0.1
Northern Territory
12 739
13 564
6.5
0.1
Australian Capital Territory
29 539
31 001
4.9
0.2
Australia(b)
914 692
952 796
4.2
. .

. . not applicable
(a) Reference year for chain volume measures is 2004-05.
(b) Domestic final demand.


All states were positive contributors to Australia's domestic final demand growth in 2005-06. Western Australia and Queensland each contributed 1.1 percentage points. These two states combined accounted for over 50% of the growth in total domestic final demand in 2005-06.



GOVERNMENT FINAL CONSUMPTION EXPENDITURE

Government final consumption expenditure rose in all states in 2005-06. Queensland showed the strongest growth in chain volume terms of 4.2%, driven by strong state and local expenditure. The lowest growth was recorded in Western Australia (up 2.0%), followed by Northern Territory (up 2.2%). The major contributors to Australia's growth in government final consumption expenditure of 3.1% were New South Wales (0.9 percentage points), and Victoria and Queensland (each 0.7 percentage points).



HOUSEHOLD FINAL CONSUMPTION EXPENDITURE

Household final consumption expenditure volume growth was strongest in Northern Territory (up 5.7%), Western Australia (up 3.9%) and the Australian Capital Territory (up 3.8%). Weaker growth was experienced in South Australia (up 1.8%), New South Wales (up 1.9%) and Victoria (up 2.1%). The major contributors to Australia's growth in household final consumption expenditure of 2.6% were Queensland and New South Wales (each 0.7 percentage points) and Victoria (0.5 percentage points).



PRIVATE GROSS FIXED CAPITAL FORMATION

In 2005-06, Western Australia had the strongest growth in private gross fixed capital formation (up 27.6%) due mainly to strong non-dwelling construction. The Australian Capital Territory (up 15.4%), the Northern Territory (up 14.8%), Queensland (up 11.8%) and Tasmania (up 10.8%) also experienced strong growth. The remaining states all had weaker growth than the Australian growth of 8.7%: Victoria (up 6.1%), New South Wales (up 2.0%) and South Australia (up 0.2%). The major contributors to Australia's growth were Western Australia (3.5 percentage points), Queensland (2.4 percentage points) and Victoria (1.5 percentage points).



PUBLIC GROSS FIXED CAPITAL FORMATION

The pattern of volume growth for public gross fixed capital formation varied considerably across the states in 2005-06. Growth in Western Australia (up 23.5%) and Queensland (up 12.1%) was particularly strong, with growth in all other states below the Australian growth rate of 7.4%. The major contributors to Australia's growth in public gross fixed capital formation were Queensland (2.9 percentage points), Western Australia (2.6 percentage points) and New South Wales (1.5 percentage points).



INDUSTRY COMPOSITION OF TOTAL FACTOR INCOME

Factor incomes grew in all states with Western Australia showing the strongest growth (up 16.9%), followed by Northern Territory (up 14.0%) and Queensland (up 13.9%). The other states showed growth rates of between 4.5% and 7.1%, all below the Australian factor income growth of 8.1%.


There was strong overall growth in compensation of employees, which grew by 7.4% in Australia between 2004-05 and 2005-06. Queensland (up 11.7%), Western Australia (up 9.8%), and Tasmania and the Northern Territory (each up 8.7%) showed the strongest growth while New South Wales (up 5.1%) and the Australian Capital Territory (up 5.5%) showed weakest growth.


There was also strong overall growth in gross operating surplus (GOS) and gross mixed income (GMI), growing in Australia by 8.8%. All states experienced growth with GOS and GMI growth strongest in Western Australia (up 22.6%), the Northern Territory (up 17.9%) and Queensland (up 16.2%). All other states were below the national growth rate, the weakest being Victoria (up 2.6%), the Australian Capital Territory (up 3.4%) and New South Wales (up 3.6%).


The table below shows industry contributions to total factor income for 2005-06. In line with long term trends, there has been a shift from goods to service industries over the period 1990-91 to 2005-06 although in the last two years this shift has been easing due to the growth in the mining industry.

Industry Contribution to Total Factor Income(a) - 2005-06

NSW
Vic
Qld
SA
WA
Tas
NT
ACT
Aust
%
%
%
%
%
%
%
%
%

Agriculture, forestry and fishing
2
3
4
5
3
7
2
-
3
Mining
3
2
12
3
27
2
26
-
8
Manufacturing
11
14
9
15
8
14
6
2
11
Electricity, gas & water supply
2
3
2
3
3
5
1
2
2
Construction
7
7
8
6
8
5
7
8
7
Wholesale trade
5
6
5
4
4
4
2
2
5
Retail trade
6
6
7
6
5
8
4
5
6
Accommodation, cafes and restaurants
3
2
3
2
1
3
3
2
2
Transport and storage
4
4
5
4
4
4
4
2
4
Communication services
3
3
2
2
2
2
2
3
3
Finance & insurance
11
9
5
6
4
6
2
4
8
Property & business services
15
14
10
10
10
6
8
13
13
Government administration and defence
4
2
4
3
2
5
7
27
4
Education
4
5
4
5
3
5
4
6
5
Health and community services
6
7
6
8
5
10
6
6
7
Cultural and recreational services
2
2
1
1
1
1
2
3
1
Personal and other services
2
2
2
2
2
2
2
3
2
Ownership of dwellings
9
8
8
9
6
7
10
9
8
General government(b)
2
2
2
2
1
3
3
5
2
Total
100
100
100
100
100
100
100
100
100

- nil or rounded to zero (including null cells)
(a) Industries may not add to total due to rounding differences.
(b) State details for general government gross operating surplus by industry are not available.


At the Australian level, the main industries contributing to 2005-06 total factor income growth were Mining, Finance and insurance, Health and community services, and Property and business services.


From a state perspective, there are differing industry impacts in total factor income growth. In 2005-06, the major contributors to growth in each state were:

  • New South Wales - Finance and insurance and Mining
  • Victoria - Property and business services and Education
  • Queensland - Mining and Construction
  • South Australia - Mining and Health and community services
  • Western Australia - Mining and Construction
  • Tasmania - Health and community services and Education
  • Northern Territory - Mining and Ownership of dwellings
  • Australian Capital Territory - Government administration and defence and Construction.


GROSS HOUSEHOLD DISPOSABLE INCOME PER CAPITA

The previous analysis of GSP per capita concentrates on the level of economic production and its growth. It does not provide a measure of incomes received by residents of a particular state, because a proportion of income generated in the production process may be transferred to other states or overseas (and conversely income may be received from other states or overseas). A measure that takes these flows into account is gross household disposable income per capita which is shown below.

Gross household disposable income per capita - 2005-06

$

New South Wales
30 229
Victoria
30 008
Queensland
26 704
South Australia
27 237
Western Australia
29 017
Tasmania
25 003
Northern Territory
30 458
Australian Capital Territory
45 382
Australia
29 257


Gross household disposable income per capita in 2005-06 was highest in the Australian Capital Territory and lowest in Tasmania. Differences between the states reflect differences in the impact of a range of factors including the average level of compensation of employees received per employee, the proportion of the population in employment, the age distribution of the population and differences in the level of dwelling rent (including that imputed to owner occupiers). For example, a significant reason for the high level of gross household disposable income per capita in the Australian Capital Territory compared with other states is that the labour force participation rate is much higher there than in the rest of Australia.


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