Latest release

Part F - Level of government

Australian System of Government Finance Statistics: Concepts, Sources and Methods
Reference period
2015
Released
23/12/2015
Next release Unknown
First release

2.75.

In the AGFS15, there are three levels of government known as the national, state and territory, and local levels of government. The Level of Government (LOG) classification used in Australia's GFS system is a standard ABS classification that is included in the SESCA. This classification divides the total public sector into the subsectors of government on the basis of role and function and underpins the production of GFS. The LOG classification separates the total public sector to reflect the administrative and legal arrangements of government in Australia for output purposes. Although conceptually 'control not further defined' is not a level of government by convention, this has been allocated as a level of government in the Australian GFS classification system. The corresponding levels of the total public sector in Australia are described in Table 2.3 as:

Table 2.3 - Level of government classification (LOG)
LOGDescriptor
1Commonwealth
2State/Territory¹
3Local
4Control not further defined²
  1. Includes Norfolk Island
  2. Includes public universities

National (LOG 1 and LOG 4)

2.76.

The National subsector is compiled for GFS output purposes and consists of the institutional units of the Commonwealth (LOG 1) (including the non-market NPIs that are controlled by the Commonwealth Government), and control not further defined units (LOG 4). The Commonwealth Government is Australia's central government which has the authority to impose certain taxes on all resident institutional units and non-resident units that are engaged in economic activity within Australia. The political responsibilities of the Commonwealth Government include national defence, the maintenance of law and order, making transfers to other levels of government, and providing collective goods and services for the benefit of the community as a whole.

2.77.

All public sector units that have a national role or function are classified to the National LOG. Units are generally considered to have a national role or function if the political authority underlying their functions extends over the entire territory of Australia or the functions involve policies that are primarily of concern at a national level. Currently, all Commonwealth Government controlled public sector units are classified to the National LOG. Such units include government units controlled by the Commonwealth Government, non-market NPIs that are controlled by the Commonwealth Government, and public non-financial and financial corporations (including the Reserve Bank of Australia) controlled by the Commonwealth Government.

Control not further defined (LOG 4)

2.78.

Units that are not controlled by the Commonwealth Government can also be classified to the National LOG. Currently, the only such cases are units that have a national role or function. These are called control not further defined units (LOG 4), formerly known as multi-jurisdictional units. These type of units are public sector units where jurisdiction is shared between two or more governments, or where the classification of a unit to a jurisdiction is otherwise unclear. The main control not further defined units currently classified to the National LOG are Australian public universities which, as described above, are mainly financed and partly controlled by the Commonwealth Government but are subject to a degree of control by the establishing state or territory government. On balance, Australian public universities are considered to be implementing policy (i.e. tertiary education) that is primarily of concern at a national level.

State / Territory (LOG 2)

2.79.

The State / Territory (LOG 2) subsector consists of institutional units which exercise the functions of government directly below that of the Commonwealth Government. State or territory governments have fiscal, legislative and executive authority over areas of Australia that have been geographically divided for political and administrative purposes. State or territory governments have the authority to levy taxes on resident institutional units and non-resident units that are engaged in economic activity within their area of jurisdiction. State / territory governments also have the authority to distribute revenue from taxes or the funding from Commonwealth Government transfers, although some of the transfers received from the Commonwealth Government may be tied to specific purposes.

2.80.

All public sector units that have a state or territory role or function are classified to the State / Territory LOG. Units are generally considered to have a state or territory role or function if the political authority underlying their functions is limited to a state or territory, or the functions involve policies that are primarily of concern at a state or territory level. The fact that a unit is controlled by a state or territory government serves as evidence (but is not necessarily conclusive) that the unit has a state or territory role or function.

2.81.

Currently, all state or territory controlled public sector units are classified to the State / Territory LOG. Such units include government units controlled by a state or territory government, non-market NPIs that are controlled by a state or territory government, and all public non-financial and financial corporations that are controlled by a state or territory government. Norfolk Island is included within the scope of the State / Territory LOG, but is currently not included within the coverage of the GFS system

Local (LOG 3)

2.82.

The Local (LOG 3) subsector consists of institutional units which exercise the functions of government directly below that of the state or territory governments. Local governments have fiscal, legislative and executive authority over areas of Australian states and territories that have been geographically divided for political and administrative purposes. The function of local government is limited in nature and heavily reliant on transfers from higher levels of government to fund the range of services they provide to institutional units and local residents within their locality.

2.83.

All public sector units that have a local role or function are classified to the Local LOG. Units are generally considered to have a local role or function if the political authority underlying their functions is limited to a local government area or the functions involve policies that are primarily of concern at a local level. The fact that a unit is established as, or directly controlled by, a local government authority serves as evidence (but is not necessarily conclusive) that the unit has a local role or function.

2.84.

Currently, all local government authorities and the units they control are classified to the Local LOG. Such units include each local government authority constituted under one of the various local government acts (or the equivalent) in each state and the Northern Territory (for example municipal councils, land councils, counties, municipalities, towns, townships, boroughs, and districts), all non-market NPIs that are controlled by a local government unit, and all public non-financial and financial corporations that are controlled by a local government unit. The Australian Capital Territory has no separate local government.