Insights into Government Finance Statistics, June 2023

Key stories and economic narratives of the June quarter 2023 Government Finance Statistics data



The Commonwealth Net Operating Balance (NOB) has increased from June to June each year since the low point of -$67.8 billion in June 2020 when the economy was heavily impacted by COVID.

The increases in the Commonwealth Net Operating Balance from June 2023 compared to June 2022 were a combination of both increases in revenue and a relatively lower increase in expenses. This was observed across most jurisdictions for the same time.

Increases in Commonwealth revenue from June 2022 to June 2023 were due primarily to strength in company income tax and personal income tax.

A relatively lower increase in Commonwealth expenses from June 2022 to June 2023 followed two years of significant government stimulus and health expenditure (in response to the COVID-19 pandemic) and material spending in disaster relief packages for affected jurisdictions.

This Insights article compares June quarter (a) net operating balance of Commonwealth and total state (b) general governments to show the recovery during this time. Due to the nature of reporting June quarter data are often more complete and can be a useful comparison point across years.

For information on the classification of new government policies impacting the June quarter 2023 click here.

  1. June quarters are used for statistical relevance and coherence. June quarters are highly impacted by large taxation revenue from Commonwealth. Government Finance Statistics figures presented are current prices, original series.
  2. "States’ refers to the state sector in macroeconomic statistics, which covers all eight state and territory jurisdictions in Australia.

Net operating balance (NOB)

  • is a summary measure that reflects the on-going sustainability of government operations
  • is derived by transactions in revenues less transactions in expenses
  • is equal to the change in net worth due to transactions

Commonwealth NOB

  • was $34.3b for the June quarter 2023
  • increased $102.1b from June quarter 2020

The main contributors to the rise in Commonwealth NOB were:

  • rises in company income tax and personal income tax
  • relatively lower rises in expenses following the cessation of significant COVID-19 and natural disaster programs in prior quarters.

Total State NOB

  • was -$4.7b for the June quarter 2023
  • increased $12.5b from June quarter 2020

The main contributors to the rise in total state NOB were:

  • rise in payroll and stamp duties on conveyances taxation revenues
  • rise in royalty income
  • rise in grant receipts from Commonwealth
  • rise in sales of goods and services revenues
  • fall in subsidy expenses to businesses impacted by COVID-19 and natural disasters have also contributed.



Company income tax

The main contributors to the 32.1% through the year rise in June quarter 2023 were:

  • higher company profitability, particularly in the mining and resources sectors with elevated prices for energy commodities
  • generally strong economic conditions, combined with rising consumer inflation.

Other likely contributors to the rise were:

  • the exhaustion of prior losses claimed by companies
  • increased regulation and compliance activities conducted by the ATO.
Personal income tax

The main contributors to the 15.5% through the year rise in June quarter 2023 were:

  • strong labour force employment and hours worked
  • rises in wages (c).

Other likely contributors to the rise were capital gains, net rent, and interest earnings from individuals (d).

  1. Wage Price Index, Australia, June 2023
  2. Commonwealth Budget Paper No. 1, Budget 2023–24
Payroll taxes

The main contributor to the rise in June quarter 2023 was strong payroll wages growth, due to a rise in employment numbers and hours worked.

Changes to government policy have also contributed to the elevated level of payroll tax in the 2022‑23 financial year:

  • All jurisdictions implemented payroll tax waivers and relief to businesses impacted by the COVID-19 pandemic in 2020, which ceased in 2022.
  • NSW payroll tax rates returned to pre-COVID-19 pandemic levels from 1 July 2022, following two years of discounted rates.
  • Victoria implemented the Mental Health and Wellbeing Surcharge on 1 January 2022.
  • Queensland implemented Mental Health Levy 1 January 2023.
Stamp duties on conveyances

Stamp duty on conveyances has increased from June quarter 2020. Likely contributors to the recovery were:

  • increased clearance rates, residential sale volumes, and dwellings prices
  • rises in housing market sentiment and consumer expectations for house prices
  • rise in immigration following border closures during the COVID-19 pandemic
  • the return of international students to Australia increased demand for housing.

Royalty income

All Australia royalty income increased to record levels through 2022-23. This was the second largest contributor to the recovery in total state NOB.

The 101.2% rise from June quarter 2020 was due to increased export volumes of commodities:

  • 154.3% rise in coal
  • 131.0% rise in natural gas
  • 16.3% rise in iron ore (e).
  1. International Trade in Goods and Services, Australia, Australia, June 2023

The jurisdictions contributing to the rise in royalty income from June 2020 were:

  • Queensland (up $2.8b; up 289.1%)
  • WA (up $0.6b; up 25.7%)
  • NSW (up $0.5b; up 114.8%).

In addition to increased exports driven by increased commodity prices, changes to government policy have also contributed to elevated levels of royalty income. Queensland implemented a 3-tier coal royalty structure from 1 July 2022.


  • all decreases in net worth resulting from transactions
  • increase in expenses decreases NOB

Subsidies on products and production

All Australia subsidies on products and production returned to pre-COVID-19 pandemic levels in June quarter 2023.

The main contributors to the fall in subsidy expenses were:

  • the conclusion of Commonwealth programs JobKeeper and Boosting Cash Flow for Employers
  • the conclusion of the joint Commonwealth-State Business Support Programs.

Pandemic and disaster assistance payments

Assistance to households impacted by pandemic related lockdowns, COVID-19 cases, and natural disasters returned to pre-COVID-19 pandemic levels in June quarter 2023 (f).

Pandemic response payments fell significantly as restrictions and lockdowns ended. Government disaster recovery payments and other support from the Commonwealth and states decreased as impacts from natural disasters eased.

  1. Includes current transfers to households for social exclusion n.e.c., natural disaster relief, and social protection n.e.c.

Compensation of employees expenses (CoE)

All Australia general government CoE (g) increased $8.1b (up 17.5%) from June quarter 2020.

State government CoE (up $6.2b; up 20.2%) was the largest contributor to the rise in total CoE from June quarter 2020. Almost 80% of total public sector employees work in state government (h). Other contributing jurisdictions were:

  • Commonwealth (up $1.0b; up 13.1%)
  • local (up $0.4b; up 10.6%)
  • universities (up $0.5b; up 11.5%).

The main contributors to the rise in total CoE were:

  • wage bonuses, pay rises, and backpay across several states
  • newly negotiated enterprise bargaining agreements and changes to public sector wage caps
  • increase in frontline employee numbers, primarily in health, education, and public order and safety.
  1. Includes superannuation expenses, wages and salaries, and other employee expenses
  2. Employment and Earnings, Public Sector, Australia, 2021-22

Classifying new government policies in macroeconomic statistics

The ABS continues to determine the appropriate classification for new government policies. These classifications are based on well-established conceptual frameworks (i), which ensure consistent recording of these policies across macroeconomic statistics, particularly in relation to Government Finance Statistics (GFS) and the National Accounts (NA).

These policies are grouped into five broad categories (j):

  • Frontline services
  • Provision of assistance to households
  • Provision of assistance to corporations, unincorporated enterprises, and non-profit institutions
  • Capital injections, establishment of new, or extended, lending facilities and provision of guarantees
  • Changes in tax and non-tax revenue

The following presents a summary of the ABS classification of major new government policies that began during March quarter 2023 and June quarter 2023 (k).

Classification of selected new June quarter 2023 policies across Commonwealth and state levels of government
Types of policiesExamples of policiesClassification in Government Finance Statistics (GFS) and National Accounts (NA) (l)
Frontline services
Public sector teacher aides, school cleaners and support staff - cost of living supplementState: (k) New pay agreements include cost of living supplements each year of the agreement (capped at 3%) if Consumer Price Index in the relevant year is higher than the base wage increase (QLD)

GFS: Wages, Salaries and Supplements

NA: GDP (E) - Government final consumption expenditure
Nurses and Midwifery Graduate Sign-on BonusState: (k) A sign-on bonus of $5,000 to nursing and midwifery graduates. 2022, 2023 or 2024 graduates that start a career in a Victorian public health service are eligible for a $2,500 sign-on payment, and an additional $2,500 after working for two years. (VIC)

GFS: Wages, salaries, and supplements

NA: GDP (E) - Government final consumption expenditure

Provision of assistance to households

Student Wellbeing BoostCommonwealth: Additional one-off funding to every school to support their students’ mental health and wellbeing, with schools receiving on average $20,000 for use in the 2023 school year

GFS: Social benefits to households in goods and services

NA: GDP (E) – Government final consumption expenditure

Provision of assistance to corporations, unincorporated enterprises, and non-profit institutions

Business Energy Efficiency Scheme

State: (k) Funds to cover, or subsidise, interest costs of eligible loans under the loan used to invest in energy efficient equipment (TAS)

GFS: Other subsidies on production

NA: GDP (I) – Other subsidies on production

Capital injections, establishment of new, or extended, lending facilities and provision of guarantees

Social Housing Accelerator

Commonwealth: A total of $2b delivered to state and territory governments to build or refurbish social housing

GFS: Capital transfers n.e.c.

NA: Capital Accounts - Capital transfers

  1. These frameworks are supported by international standards such as the International Monetary Fund (IMF) Government Finance Statistics Manual 2014 (GFSM 2014) and the System of National Accounts 2008 (2008 SNA)

  2. The categories are broadly based on the recommendations in “COVID-19: How to Record Government Policy Interventions in Fiscal Statistics” (IMF, 2020)

  3. This table summarises key policies with an impact on the macroeconomic accounts and does not cover every specific government policy in Australia

  4. NA includes the gross domestic product (GDP) accounts, which are measured using the expenditure approach (GDP (E)), the income approach (GDP (I)) or the production approach (GDP (P)).  NA also includes income accounts, capital accounts, financial accounts, and balance sheet

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