Annual Report 2016
The Department of Environment, Land, Water and Planning acknowledges Victoria’s Aboriginal communities and pays respect to their Elders both past and present. DELWP acknowledges the richness of Aboriginal cultures in Victoria and their connection to country. 

Accountable Officer’s Declaration
In accordance with the Financial Management Act 1994, I am pleased to present the Department  of Environment, Land, Water and Planning annual report for the year ending 30 June 2016. 

Adam Fennessy 
Secretary  Department of Environment, Land, Water and Planning 22 September 2016

Cover photo: Aireys Inlet Lighthouse © Michael Lawson
Contents
Accountable Officer’s Declaration	
Secretary’s message 	2
Key initiatives and projects 2015-16	3
Delivering on our promise for all Victorians	4
About DELWP	7
Financial review	17
Our people 	21
Office-based environmental performance 	36
Departmental objectives, indicators and outputs 	46
Healthy, resilient and biodiverse environment 	47
Productive and effective land management 	52
Safe and sustainable water resources	57
A quality built environment	61
Sustainable and effective local governments	64
Reduced impact of major bushfires and other emergencies on people,  property and the environment 	67
Legislative and other information 	71
Financial Statements 30 June 2016	96
Appendices	229
Appendix 1: Disclosure Index  	229
Appendix 2: Budget portfolio outcomes	232
Appendix 3: Capital projects 	238
Appendix 4: Disclosure of grants and transfer payments	239
Appendix 5: Environmental contributions 	258
Appendix 6: Ministerial Statements of Expectations	261
Appendix 7: Municipal and Industrial Landfill Levy Trust Account	268
Appendix 8: Sustainability Fund Account and Sustainability Fund Grants 2015-16	269
Appendix 9: Acronyms	284

Secretary’s message 
The purpose of the Department of Environment, Land, Water and Planning (DELWP) is to support liveable, inclusive and sustainable communities and thriving natural environments throughout Victoria. The department’s creation on 1 January 2015 provided a foundation on which to make a positive and lasting impact for Victorian communities. Since then, we have made progress in developing a unique identity, improving organisational culture and embedding our values of Teamwork, Service Excellence, Ownership, and Wellbeing and Safety. 
A key focus for DELWP is putting the community at the centre of our work. The expectations of Victorian communities are clear: you are looking for a partner in DELWP that is responsive to your needs, can bring stakeholders together, is integrated and easy to navigate and that can support and empower people to achieve shared outcomes. In response, our community charter makes a promise to Victorians that we will be available and easy to contact, we will speak clearly and honestly, actively listen and seek to understand, and that we will be timely and consistent in taking action. 
The community charter is consistent with the recommendations of the November 2015 independent investigation into the Lancefield-Cobaw Fire, which followed a DELWP planned burn that breached containment lines. DELWP deeply regrets what occurred at Lancefield, Cobaw, Benloch and surrounds, and is committed to working together with the community and our partners to reduce the risk of bushfire to protect people, property and the environment. We will ensure our land and fire management actions are community focused and driven by local decision making.

The Lorne-Jamieson Track (Wye River – Jamieson Track) fires, which occurred during the Christmas period, and were started by lightning strikes, reinforced how devastating bushfire can be and how vital our role is in helping to protect communities. 
Reflecting our approach to creating a high-performing organisation aligned to the needs and expectations of communities, we have launched our digital online hub, HaveYourSay at DELWP to enable us to collaborate with the community on shared solutions. These have included: Protecting Victoria’s Environment - Biodiversity 2036; the draft Water for Victoria discussion paper; Our Catchments, Our Communities; and the reform of the Local Government Act 1989.
The DELWP Annual Report records the achievements and initiatives across the Environment and Climate Change, Water, Planning, Suburban Development and Local Government portfolios in 2015-16. From 2016-17, following a Machinery of Government change, DELWP will also include the Energy portfolio. We welcome this change and the opportunities and benefits this brings to DELWP’s approach to climate change action, and our work across the environment, planning, water and local government portfolios. 
We are committed to reflecting the communities we serve through a diverse, inclusive and gender equitable workforce, where our people are empowered to work flexibly and encouraged to think innovatively. We established our DELWP Diversity and Inclusion Council, and support people to work flexibly through our ‘All Roles Flex’ approach. Our target for 50 per cent of our DELWP executive leadership positions to be filled by women was achieved in July 2016.
We are proud to contribute to these initiatives and we are committed to measuring our performance and holding ourselves accountable to achieving change for communities across Victoria.

Adam Fennessy 
Secretary  
Department of Environment,  Land, Water and Planning
Key initiatives and projects 2015-16
During 2015-16, we delivered a number of key initiatives and projects for Victorian communities. In particular, we: 
Responded to the independent Lancefield-Cobaw fire investigation by making significant changes to how the department operates across the state to improve delivery of the planned burning program
Attended 1,148 fires, including fires on both public and private land. More than 90 per cent of these fires were kept to less than five hectares (compared to a target of 80 per cent), an indication of the effectiveness of first attack
Treated 197,940 hectares of fuel reduction activities (this includes 13,247 hectares of mechanical works, such as slashing or mowing)
Issued the first approvals for rebuilding after the Wye River–Jamieson Track fire within six months of the fires
Launched our Aboriginal Inclusion Plan Munganin-Gadhaba, meaning ‘Achieve Together’ in Taungurung language, to set out our approach to achieve our outcomes of Recognition and Respect, Opportunity and Prosperity, and Participation and Collaboration over the period of 2016-20
Launched the Water for Victoria discussion paper, proposing potential solutions for Victoria’s water future in the short, medium and long term. Twenty eight stakeholder and community workshops were held with over 700 participants
Conducted two drought tours in November 2015 and April 2016, when the Premier, Minister for Water, and Minister for Agriculture visited drought affected areas across the north west of Victoria to hear first-hand from farmers and communities about the impact of the on-going lack of rainfall.  Over $54 million of water infrastructure projects and programs was announced and fast tracked 
Invested in a number of irrigation upgrades in southern Victoria including $20 million for the Macalister Irrigation District and $14.7 million for the Werribee and Bacchus Marsh Irrigation Districts. These projects will be delivered by Southern Rural Water to improve water efficiency throughout the districts.
Supported the Crown Land Legislation Amendment (Canadian Regional Park and Other Matters) Bill 2015 through Parliament,  to implement the election commitment for a new 640 hectare Canadian Regional Park near Ballarat
Know Your Council helped 65,000 users access information about their council services, on topics ranging from animal management to food safety and financial performance
Established the Fair Go Rates System for the 2016-17 financial year, that places a rate cap of 2.5 per cent.
Approved the master plan for a $200 million, three tower development, to transform the former Melbourne Convention Centre site on Spencer Street
Approved 34 community infrastructure projects for funding, through the Growing Suburbs Fund totalling $47.9 million and leveraging more than $118 million in infrastructure investment in the interface councils, doubling the Government’s investment
Announced a long-term state climate change goal of net zero greenhouse gas emissions by 2050, and launched Take 2 – Victoria’s Climate Change Pledge
Tabled the Review of the Climate Change Act, which seeks to provide Victoria with a world-leading legislative foundation for its climate change agenda. 
These initiatives highlight how DELWP has delivered for Victorians and how we are laying the foundations for a high performing organisation that places Victorian communities, together with the natural and built environments, at the centre of everything we do.

Delivering on our promise for all Victorians
DELWP’s purpose is to shape and support liveable, inclusive and sustainable communities and thriving natural environments throughout Victoria. To make a real and lasting economic, social and environmental impact, we must truly understand and meet the needs of the communities we serve. 
The needs and expectations of our communities are not static. Accordingly, we must anticipate what our communities need and be capable of adapting our approaches. To deliver on our promise we need to build a modern and agile organisation that delivers integrated and innovative policy and place-based programs and services that respond to communities’ needs.
Our community charter
The DELWP community charter (see page 6) guides all of our formal and informal interactions with communities. The way in which we will do this includes utilising local networks, building capacity, and improving the way in which we communicate. These changes will ultimately help DELWP to achieve its objectives for our shared environment and improve outcomes for local communities. 
We work closely with a wide range of stakeholders, including:
Community groups – we will build better relationships, involve the community to reach decisions by participating via HaveYourSay at DELWP, improve the capacity of community members and DELWP staff to actively engage, enhance liveability and decrease risk. We will continue to support participation in environmental works by a diverse range of local community groups by supporting Landcare and other not-for-profit and volunteer organisations across the state.
Victorian local governments – underpinned by the Victorian State-Local Government Agreement, DELWP works with Victoria’s 79 local governments to support effective local governance, plan for growth and provide infrastructure. DELWP administers the Local Government Act 1989 and supports councils and their peak bodies to build the sector’s capacity to plan and deliver services and infrastructure.
Victorian government departments and agencies – we work with all departments in joint strategic planning and infrastructure development. The DELWP Secretary has signed a memorandum of understanding with the Secretary of the Department of Economic Development, Jobs, Transport and Resources (DEDJTR) to implement the Government’s Plan for Jobs and Growth as well as developing the Government’s climate change and energy strategies. DELWP also works with Emergency Management Victoria, Victoria Police, the Country Fire Authority (CFA) and other emergency management agencies to prepare for, respond to and recover from natural disasters and other emergency events.
Commonwealth Government – we work with the Commonwealth to deliver major infrastructure projects and support national agreements and initiatives developed by the Council of Australian Governments and portfolio-based national ministerial councils.
Industry and business – we work with industry and business to identify and facilitate opportunities to improve the state’s productivity, attract new investment and generate jobs and growth. This includes engaging the private sector on infrastructure planning and delivery, attracting investment in innovative renewable energy generation technologies, supporting energy efficiency for small and medium businesses, delivering sustainable industrial and housing development, improving regulatory processes and streamlining the state’s planning, building and heritage systems.
Ministerial advisory bodies – DELWP works with ministerial advisory bodies across its portfolio areas of responsibility. These include the Victorian Coastal Council, Victorian Environment Assessment Council, a range of advisory committees established by Planning Panels, a Four Wheel Drive Advisory Committee and a Local Government Mayoral Advisory Panel.
Peak bodies – we work with statewide organisations, industry bodies, policy institutes, and universities. These relationships include research, policy development, program implementation and funding support. Our key partners include VicWater, Cooperative Research Centre for Water Sensitive Cities, Victorian Mineral Water Committee, the Municipal Association of Victoria, Victorian Local Governance Association, Law Institute of Victoria, Planning Institute of Australia, Victorian Planning and Environmental Law, Urban Development Institute of Australia, Property Council, Australian Property Institute and land surveying, conveyancing, planning and environmental organisations.
Aboriginal Victorians – we work inclusively with Aboriginal Victorians to manage the public estate and its natural values. Through the Traditional Owner Land Management Boards and other forms of joint management, Victoria’s Traditional Owners are partners in managing public land and in creating a shared vision for managing natural and cultural values. Aboriginal communities have many interests and roles within the environment, land, water, planning, heritage, and local government and communities. 
	As Native Title Holders, Traditional Owners are recognised, through Recognition and Settlement Agreements, and land management agreements.  Government also partners and works closely with registered Aboriginal parties. These partnerships ensure that both Traditional Owners and registered Aboriginal parties maintain a strong connection to Country and work collaboratively with government on policy, planning and approvals for activities run by DELWP and its portfolio partners.
Portfolio partners – DELWP collaborates with a wide range of portfolio partners to create liveable, inclusive and sustainable communities. Our activities to protect our natural environment and ensure reliable ecosystem services are delivered through a range of public sector entities, including the Environment Protection Authority, Parks Victoria, Sustainability Victoria, Royal Botanic Gardens, Zoological Gardens, Trust for Nature, water corporations, the Victorian Environmental Water Holder, catchment management authorities, local governments and waste and resource recovery groups. We collaborate with a wide range of public entities to protect and enhance the built environment. These include Development Victoria, Victorian Building Authority, Victorian Planning Authority, Heritage Council of Victoria, Office of the Victorian Government Architect and Surveyors Registration Board of Victoria.
About DELWP
DELWP manages Victoria’s natural and built environments to create and maintain liveable, inclusive and sustainable communities. We do this in a way that protects our natural assets and supports a growing economy while meeting the challenges of climate change and population growth.
DELWP employs more than 3,000 staff, who work across 101 locations throughout the state. DELWP is a key manager of Victoria’s public estate. The department directly manages $9.8 billion of assets - 69 per cent of the asset portfolio comprises various categories of public land. The department owns and manages about $1.6 billion of other assets including 40,000 kilometres of roads and tracks, office buildings, depots, public toilets, picnic shelters, recreational facilities, firefighting and road maintenance equipment, crossings, water  bores and mobile plant. A further $48.7 billion  of assets is managed by portfolio agencies. 
Our vision
DELWP contributes to the Victorian Government’s commitment to a stronger, fairer, better Victoria by promoting development and jobs while protecting our built and natural environments.
Our mandate
Our mandate is to support Victoria’s natural and built environment to ensure economic growth and liveable, sustainable and inclusive communities that are resilient to the impacts of climate change.
Our mission
Our mission is to:
create liveable, inclusive and sustainable communities by connecting metropolitan and regional community priorities and services to state planning for Victoria’s growth and development 
care for and protect the environment and help to respond to climate change through risk mitigation and adaptation strategies 
protect, enhance and strengthen the resilience of our quality built and natural environments, assets and resources.
Our outcomes
The department is guided by six strategic outcomes:
Healthy, resilient and biodiverse environment
Productive and effective land management
Safe and sustainable water resources
A quality built environment
Sustainable and effective local governments
Reduced impact of major bushfires and other emergencies on people, property and the environment.
Our values
At DELWP, we believe the way we work and behave with each other, our stakeholders, ministers and the community is as important as the outcomes we achieve for the Victorian community. Together, we have developed and agreed to a set of behaviours to bring to life our values of: Teamwork; Service Excellence; Ownership; and Wellbeing and Safety (page 8). By living the values, we create a high performing, positive culture that makes DELWP a great place to work. As members of the Victorian Public Service, we also agree to work by the Victorian Public Service Values and Code of Conduct, which sets the expectations for how we behave as public servants. 
Our Ministers 
Special note on Machinery of Government changes
On 23 May 2016, the Victorian Government announced changes to some ministerial portfolios. Minister Neville retained the Water portfolio, while also assuming responsibility as Minister for Police. Minister D’Ambrosio took on the new portfolio of Energy, Environment and Climate Change, with a focus on renewable energy, energy efficiency and combatting the effects of climate change. Minister D’Ambrosio also became Minister for Suburban Development. These changes resulted in the transfer of the Energy portfolio from DEDJTR  to DELWP commencing from 1 July 2016.
Minister for Water
The Hon. Lisa Neville MP was elected as the Member for Bellarine in 2002.
Ms Neville was appointed as the Minister for Environment, Climate Change and Water in 2014. In 2016, Ms Neville became Victoria’s first female Minister for Police, while also retaining the Water portfolio.
Minister for Energy, Environment and Climate Change and Minister for Suburban Development 
The Hon. Liliana (Lily) D’Ambrosio was first elected to the Lower House seat of Mill Park  in 2002.
In 2014, Ms D’Ambrosio was named Minister for Industry and Minister for Energy and Resources. In 2016, she became Minister for Energy, Environment and Climate Change and Minister for Suburban Development.

Minister for Planning
The Hon. Richard Wynne MP was appointed Minister for Planning in 2014. 
Mr Wynne has been the Member for Richmond since 1999. 

Minister for Local Government 
The Hon. Natalie Hutchins MP was appointed Minister for Local Government in 2014, and is also Minister for Aboriginal Affairs and Minister for Industrial Relations and was elected  Member for Sydenham  in 2014. 
Parliamentary Secretary for Environment 
The Hon. Anthony Carbines MP was appointed Parliamentary Secretary for the Environment in 2014.

Our executive 
Adam Fennessy
Secretary
Adam is the department’s Secretary and has held this role since 1 January 2015. Prior to this, Adam was Secretary of the Department of Environment and Primary Industries (DEPI), and Acting Secretary of the former Department of Sustainability and Environment (DSE). 
Adam is passionate about leading a high-performing, positive culture based on DELWP’s values that delivers for Victorians and puts the community at the centre of everything we do.  
Adam’s vision is for DELWP to reflect the communities it serves, through a diverse, inclusive and gender equitable workforce, where everyone at DELWP is empowered to work flexibly and encouraged to think innovatively.  
In his role as a Victorian Male Champion of Change, Adam believes that gender equity is everyone’s business and is driving gender equity across DELWP and areas of state government.  Adam is serving as Deputy President of the Institute of Public Administration Victoria and sits on the board of Infrastructure Victoria.   
Living in Bendigo with his partner and young family gives Adam a unique perspective of the work DELWP does across regional and metropolitan areas of Victoria.
Adam holds a Bachelor of Economics (Hons), a Bachelor of Laws and a Graduate Diploma in Legal Practice.
Lee Miezis 
Deputy Secretary, Forest, Fire and Regions
Lee is the Deputy Secretary, Forest, Fire and Regions Group. Lee became the Acting Deputy Secretary on 4 March 2016 when the Forest, Fire and Regions Group was created, and then appointed as the Deputy Secretary on 31 March 2016.
Lee has broad experience working across the public sector in policy, operations and strategy development and has developed a deep knowledge of forestry, fire and emergency management and regional Victoria. Lee has built strong relationships across DELWP, in the community and across the state.
As Deputy Secretary, Forest, Fire and Regions he leads a workforce of more than 1,300 staff delivering effective, forest, fire and emergency management, including managing Victoria’s 3.8 million hectares of State forest. Prior to his current role, Lee was the Executive Director, Fire and Emergency Management, and has held a number of senior leadership roles in the former DEPI and former DSE.
Lee led DELWP’s response to the independent investigation into the Lancefield-Cobaw fire and the subsequent organisational redesign. He also played a critical role in the development of Safer Together, the Government’s risk-based approach to bushfire management.
Lee holds a Bachelor of Forest Science and a Master of Business Administration.

Christine Wyatt
Deputy Secretary, Planning
Christine commenced her role as Deputy Secretary, Planning on 1 January 2015. Christine’s role in DELWP continued on from her role in the former Department of Transport, Planning and Local Infrastructure (DTPLI), where she was appointed Deputy Secretary, Planning in February 2014.
As Deputy Secretary, Christine is responsible for leading the state’s planning, building and heritage systems.  The Planning portfolio develops long-term integrated land use strategies and policies for Melbourne and regional Victoria, administers statutory planning, building and heritage responsibilities, and manages and regulates the planning system to support growth and enhance liveability.
Christine is the Deputy Chair of Places Victoria, the state’s urban renewal authority which focuses on development of underutilised government land. She is also a Board member of the Victorian Planning and Environmental Law Association and a graduate member, Australian Institute of Company Directors.
Christine brings to the Department over 30 years of experience in urban and environmental planning throughout Australia and internationally, encompassing government liaison, statutory and strategic planning, policy development and formulation, environmental impact assessment, environmental management, and implementation of stakeholder communication strategies.
Prior to joining the public sector in 2014, Christine held senior positions in global consulting firms AECOM and GHD.  Most recently she was GHD’s Global Environment Market Leader, overseeing the strategic development of the environment business worldwide.
Christine holds a Bachelor of Town and Regional Planning and a Masters in Environmental Studies.
Kate Houghton
Deputy Secretary, Water and Catchments
Kate is the Deputy Secretary, Water and Catchments. Kate became the Acting Deputy Secretary on 1 July 2015, and was then appointed on 30 November 2015. Prior to this, she held senior roles across DELWP, DPC and the NSW Environment Protection Authority. 

Kate has 20 years of experience in public policy development, governance reform and implementation strategies with a key focus on reform across the environment and natural resource sectors (water, climate change, biodiversity, waste, contaminated land, air  and noise).
As Deputy Secretary, Kate has responsibility for providing policy advice to government on sustainable water resource management, including issues such as water supply and security, catchment management, implementing the Murray Darling Basin Agreement, national water reform and oversight of major state projects and programs. The Government’s new water plan is a key focus.
Kate holds a Bachelor of Economics (Hons) and Masters of Environment.
Kathryn Anderson
Deputy Secretary, Corporate Services
Kathryn was appointed Deputy Secretary, Corporate Services, in April 2015.
Kathryn leads Corporate Services, which aims to be a core enabler of a high performing DELWP. Kathryn is responsible for the delivery of people and culture, finance and planning, business, executive and ministerial services, legal services, information services and communications support and advice.
Kathryn chairs key governance committees focused on diversity and inclusion, Aboriginal inclusion, finance and performance and implementation of Digital First.
Kathryn has more than 25 years of experience as a public servant, across Commonwealth, Queensland and Victorian jurisdictions, including six years with the Queensland Department of Premier and Cabinet. Kathryn has spent several years focused on work to address Aboriginal disadvantage including working with the Cape York Institute for Policy and Leadership.
Kathryn holds a Bachelor of Arts and a Graduate Certificate in Business.
Paul Smith
Deputy Secretary, Environment and Climate Change
Paul is the Deputy Secretary, Environment and Climate Change. Paul commenced in this role in March 2016, following on from his role as the Deputy Secretary of Land, Fire and Environment. 
Paul has broad executive experience in utilising partnerships to deliver results and in driving major reform in the areas of land, fire and environment.
Paul has built successful relationships with DELWP’s many environment and land portfolio partners and with Victoria’s Networked Emergency Organisations. He also led the former DSE’s response to the Victorian Bushfires Royal Commission.
Paul holds a Bachelor of Social Science and a PhD in Environmental Policy.
Terry Garwood
Deputy Secretary, Local Infrastructure
Terry is the Deputy Secretary, Local Infrastructure. He has been a Deputy Secretary for nearly three years in both DELWP and the former DTPLI and has responsibility for the operation of Local Government Victoria, Land Victoria and the Suburban Development Division.
Terry has been a career public servant for  36 years and served in a number of Commonwealth and Victorian public service departments in Canberra, Melbourne and regional Victoria. They include the Department of Aboriginal Affairs, the Department of Employment, Education and Training, the Aboriginal Development Commission, Aboriginal Hostels Limited, Aboriginal Affairs Victoria, the Department of Human Services and the Department of Transport, where he served as the Executive Director, Freight, Logistics and Marine for seven years.
Terry’s particular interests include policy development, community capacity building, regional development and strong collaborative partnerships.
Terry holds a Diploma of Arts, a Graduate Diploma of Education (Secondary) and is on the Board of the Institute of Public Administration Australia (Victoria).
Bernie O’Sullivan
Deputy Secretary, Regional Services
Bernie was appointed to the role of Deputy Secretary in the former DEPI on 6 May 2013 and held this until 7 March 2016. Following on from this role, Bernie commenced his role as Chief General Manager Regional Leadership in March 2016, leading important regional and place-based policy priorities for the Victorian Secretaries Board (see page 12).
Structural changes to the department
In November 2015, the Victorian Government launched Safer Together - a new approach to reducing the risk of bushfire in Victoria. This new approach, together with Victoria’s Regional Statement and the results of the independent investigation into the Lancefield-Cobaw fire and a desire to engage differently with our communities, led DELWP to establish a new Forest, Fire and Regions Group in March 2016. 
The Forest, Fire and Regions Group provides end-to-end management of forests, fire and other emergencies including policy and on-ground operational delivery, under a single Deputy Secretary. The new structure provides a single line of responsibility for bushfire management, including planned burning, from local to state levels under the Chief Fire Officer, who reports directly to the Secretary. The new structure aligns with the recommendations of the independent investigation into the Lancefield-Cobaw fire and recognises that bushfire is DELWP’s most significant risk to manage. 
The new structure also ensures that community is reflected at state, regional and local levels, demonstrating our commitment to engagement and collaboration with the community, as well as our commitment to developing effective partnerships at place to deliver better outcomes. The structure also facilitates increased consistency at the district level, with scope to refine as required to meet local requirements. 
The Forest, Fire and Regions Group includes more than 1,300 staff, as well as around 400 seasonal project firefighters and casual staff. The teams work at around 80 locations across the six geographic regions shown in the map on page 14: Barwon South West, Gippsland, Grampians, Hume, Loddon Mallee and Port Phillip. Our statewide resources and local connections enable us to effectively deliver on the Government’s priorities across Victoria’s regions.
Our functions and services 
DELWP is structured around six business groups that work together to support our ministers and their portfolio partners to deliver the Government’s priorities:
Environment and Climate Change – provides high quality policy advice to government on directions, principles, strategies and actions to protect the environment, mitigate harmful impacts and identify ways the environment, economy and society can achieve mutually beneficial outcomes. The Group also leads the whole of government response to climate change. From 1 July 2016, the Energy portfolio will also be included in DELWP and will bring additional opportunities and benefits to the department’s approach to climate change action and our work across the environment portfolio.
Forest, Fire and Regions – delivers integrated, accessible and high-quality departmental programs and services in partnership with local communities. The group helps communities to prepare for, respond to and recover from natural disasters and other emergencies and provides valuable intelligence to decision makers on how policy and program design can be shaped to better meet the needs of the Victorian community. 
Local Infrastructure – works with local government to support the delivery of services and infrastructure and build stronger communities across the state. The group also provides administration and information services for the Victorian property industry and the wider community. Following the announcement of the new machinery of government arrangements on 23 May 2016, the Suburban Development portfolio has been established in DELWP to provide Melbourne with the necessary governance and coordination frameworks to strengthen economic planning, better align Government investment in infrastructure and services and engage Melbourne’s communities and business in helping shape the city’s future liveability.
Planning – manages the state’s planning, building and heritage systems including; developing long-term, integrated land use strategies and policies, administering statutory responsibilities and facilitating urban development.
Water and Catchments – in partnership with water corporations and catchment management authorities, manages Victoria’s water resources to meet urban, rural and environmental needs. The group helps to deliver secure water supplies for productive farms, liveable cities and towns, and healthy waterways and aquifers.
Corporate Services – provides business support services to enable ministers, DELWP business groups and the wider DELWP portfolios to deliver on our shared outcomes.
Our governance structure 
The Secretary, as head of the department, is accountable to the Minister for Water, Minister for Energy, Environment and Climate Change and Suburban Development, Minister for Local Government and Minister for Planning for the overall governance of the department.
Risk and Audit Committee  
The Risk and Audit Committee is an independent body established in accordance with the Standing Directions of the Minister for Finance under the Financial Management Act 1994. It provides assurance to the Secretary that the department’s risk and control environment is operating effectively and efficiently. The Risk and Audit Committee meets bi-monthly or as determined by the Chair.
In 2015-16, Risk and Audit Committee members were:
John Rundell (Chair)	Independent member	
Suzanne Evans	Independent member	
Helen Thornton	Independent member	
Mark Peters	Independent member	
Fiona Delahunt	Executive Director,  Forward Policy and Business Strategy	
Graham Phelps	Regional Director, Loddon Mallee	
Kathryn Anderson	Deputy Secretary, Corporate Services	
Kate Houghton	Deputy Secretary, Water and Catchments (from February 2016)	

Senior Executive Team
The DELWP Senior Executive Team (SET) is the primary executive management body in DELWP. Its role is to lead DELWP and its people in the development of a positive, collaborative high performing organisation that excels in delivery for the government through successful partnerships and a commitment to service excellence. SET comprises the Secretary (Chair) and Deputy Secretaries.
SET establishes sub-committees as required, including the Finance and Performance committee, the Procurement Governance committee (see below) and the Executive Remuneration and Staffing committee.
Procurement Governance Committee
The Procurement Governance Committee (PGC) is the internal body established within DELWP tasked with provision of the strategic direction of the department’s procurement function (including goods, services and construction related procurement). It is established in adherence to the Victorian Government Purchasing Board (VGBP) Governance Policy under the directions of the Financial Management Act 1994. The PGC membership is appointed by the Secretary and meets monthly.  
In 2015-16 the committee’s membership comprised: 
Kathryn Anderson (Chair)	Deputy Secretary, Corporate Services	
Anthony Connelly (Chief Procurement Officer)	Executive Director, Business Executive and Ministerial Services	
Carolyn Jackson  (Chief Finance Officer)	Executive Director Finance and Planning	
Fiona Delahunt	Executive Director,  Forward Policy and Business Strategy	
Andrew Fennessy	Executive Director, Rural Water Programs	
Lee Miezis	Deputy Secretary, Forest Fire and Regions (from March 2016)	
Ben Wearne	Acting Director, Operations and Business Performance, Environment and Climate Change	
Mark Curry	Executive Director, Local Infrastructure Policy and Partnerships	
Claire Foo	Executive Director, Information Services	
Bernie O’Sullivan	Deputy Secretary, Regional Services (until February 2016)	

Attestation for compliance with Ministerial Standing Direction 4.5.5 
Teamwork

We respect and welcome different perspectives
We listen to others, give and actively seek constructive feedback
We lead, empower and trust others
We support and constructively challenge our colleagues
We are flexible when dealing with change and ambiguity
Ownership

We create a safe environment that  encourages people to show initiative,  learn from mistakes and grow
We support, trust, equip and empower  people to make decisions
We value the experience and ideas  of our people
We take pride in our work and the  organisation, leading by example
We own our actions and decisions  that are made

Wellbeing and Safety

We create an environment where it is  OK to speak up and where issues can be raised and resolved constructively
We each take personal responsibility  for our own wellbeing and safety, and that of our colleagues
We lead by example and are active role models in how we treat ourselves and others
We think before acting, are caring, supportive and show empathy towards others
Service Excellence

We set clear objectives, are honest,  transparent and timely
We take pride in our professional service delivery and engender excellence into everything we do
We look for opportunities to connect  and work together to provide better  service outcomes
We encourage innovation and different ways of working to improve service delivery
We understand the customer’s and community’s needs by stepping into  their shoes
Anthony Carbines MP
Parliamentary Secretary  for the Environment

The Hon Lily D’Ambrosio MP
Minister for Energy, Environment and Climate Change
Minister for Suburban Development

Darrin McKenzie
Chief Fire Officer (acting)
Michael Hodder
Chief Operating
Officer, Community
& Services
Vivienne Clare
Executive Director
Strategy, Capability &
Innovation
Organisational structure 
The organisational chart shows the department’s structure and senior executives for delivery of functions as at 30 June 2016. 

Reporting line under chain of command for fire response and planned burning operations
Lee Miezis
Deputy Secretary
Forest, Fire and Regions
Helen Vaughan
Regional Director
Barwon South West
Mike Timpano
Regional Director
Gippsland (acting)
Allyson Lardner
Regional Director
Grampians (acting)
Darien Wahlquist
Regional Director
Hume (acting)
Adam Melis
Regional Director
Loddon Mallee (acting)
Kelly Crosthwaite
Regional Director
Port Phillip
The Hon Richard Wynne MP
Minister for Planning

Paul Smith
Deputy Secretary
Environment and
Climate Change
Kath Rowley
Executive Director
Climate Change
Peter Beaumont
Executive Director
Land Management Policy
Nina Cullen
Executive Director
Biodiversity
Adam Fennessy
Secretary
Department of Environment, Land, Water and Planning
Christine Wyatt
Deputy Secretary
Planning
Jane Homewood
Executive Director
Statutory Planning
Services
Fiona Delahunt
Executive Director
Forward Policy & Business
Strategy
Nick Wimbush
Executive Director
Planning, Building &
Heritage (acting)
Julian Lyngcoln
Executive Director
Planning Implementation
Kathy Mitchell
Chief Panel Member
Planning Panels Victoria
The Hon Natalie Hutchins MP
Minister for Local Government

Terry Garwood
Deputy Secretary
Local Infrastructure
Mark Curry
Executive Director
Suburban Development
Chris McRae
Executive Director
Land Victoria
Graeme Emonson
Executive Director
Local Government Victoria
Bernie O’Sullivan
Chief General Manager
Regional Leadership
Kathryn Anderson
Deputy Secretary
Corporate Services
Gary Atherton
Executive Director
People and Culture
Carolyn Jackson (CFO)
Executive Director
Finance and Planning
Anthony Connelly (CPO)
Executive Director
Business, Executive and
Ministerial Services
Claire Foe (CIO)
Executive Director
Information Services
Kirsty Douglas
General Counsel
Legal Services
Catherine Payne
Executive Director
Communications
The Hon Lisa Neville MP
Minister for Water

Lead Minister for the Department
Peter Sammut
Chief Executive
Capital Projects
Kate Houghton
Deputy Secretary
Water and Catchments
Dr Sharon Davis
Executive Director
Water Resources
Andrew Fennessy
Executive Director
Rural Water Programs
Michael Wheelahan
Executive Director
Policy, Governance &
Legislation (acting)
Paul Bennett
Executive Director
Integrated Water &
Catchments
	2016 Annual Report 
Financial review
Five-year financial summary 
	2016
$’000
(DELWP)	2015
$’000
(DELWP)	2014
$’000
(DEPI)	2013
$’000
(DEPI)	2012
$’000
(DSE)	
Income from government1	1,223,155	1,340,615	1,398,269	1,045,240	1,083,674	
Total income from transactions	1,688,819	1,802,945	1,665,813	1,278,847	1,375,567	
Total expenses from transactions	1,667,768	1,479,411	1,580,771	1,264,680	1,315,285	
Net result from transactions2	21,051	323,534	85,042	14,167	60,282	
Net result for the period	(33,732)	326,533	69,342	243,820	12,621	
Net cash flow from operating activities	140,057	311,435	88,996	46,255	127,780	
Total assets	9,817,526	8,581,597	8,703,808	7,749,716	7,579,853	
Total liabilities	283,616	295,858	672,102	295,157	283,242	

Note:
1.	Income from government includes both output and special appropriations.
2.	The ‘net result from transactions’ is identical to the ‘net operating balance’ for the general government sector.
3.	The comparative amounts in the five year financial summary are not restated for the Machinery of Government changes, which are outlined in the section below.
Current year financial review
Overview 
The Victorian Government considers the net result from transactions to be the appropriate measure of financial management that can be directly attributed to government policy. This measure excludes the effects of revaluations (holding gains or losses) arising from changes in market prices and other changes in the volume of assets shown under ‘other economic flows’ on the comprehensive operating statement, which are outside the control of the department.
In 2015-16, DELWP recorded a net result  from transactions of $21.1 million, which was  $302.5 million lower than in 2014-15. 
Notes on Machinery of Government changes 
For comparison, 2015-16 marks the first full year results for the department that reflect the Machinery of Government (MoG) administrative arrangements announced on 4 December 2014 and implemented on 1 January 2015. The 2013-14 results for the former Department of Environment and Primary Industries (DEPI) reflect the MoG Administrative Arrangements implemented on 1 July 2013. 
The MoG Administrative Arrangements announced in 2014-15 resulted in the former DEPI relinquishing its Agriculture, Biosecurity  and Sustainably Manage Fish and Forest Resources outputs to DEDJTR. In addition, DELWP assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect, and Planning, Building and Heritage outputs from the former Department of Transport, Planning and Local Infrastructure (DTPLI), and part of the Regional Development (Planning) output from the former Department of State Development, Business and Innovation (DSDBI).

As part of MoG Administrative Arrangements implemented on 15 May 2015, DELWP relinquished the Office of Victorian Government Architect output to the Department of Premier and Cabinet (DPC).
The prior MoG Administrative Arrangements in 2013-14 resulted in the former Department of Sustainability and Environment (DSE) relinquishing its Land Administration and Property Information output to the former DTPLI and the former DSE assuming responsibility for the Development of Primary Industries output from the former Department of Primary Industries and becoming the former DEPI. 
On 23 May 2016, further MoG changes were announced which transferred the Energy Output to the department from DEDJTR.  For accounting purposes, this transfer was effective from 1 July 2016 and as such, the 2015-16 financial results are not impacted by this decision.
Financial performance and business review
In 2015-16, DELWP recorded a lower net result from transactions, due to a decrease in total income from transactions of $114.1 million and an increase in expenditure from transactions  of $188.4 million.  
The decline in income is largely due to the 1 January 2015 MoG change which resulted in a higher value of output appropriations being transferred to DEDJTR on 1 January 2015, than that transferred from the former DTPLI.  There was also a significant decrease in Special Appropriation as the one-off transfer to establish the accounting arrangements for the Goulburn-Murray Water (GMW) Connections Project reported in last year’s summary was not required in 2015-16.  Similarly, the Grant revenue received from the Commonwealth government for the same project was not received this financial year as the project phasing was reset.  These decreases were partially offset by the recognition of the Landfill Levy of $201.2 million for the first time, because of the transfer of the Municipal and Industrial Landfill Levy Trust Account and the Sustainability Trust Fund Account from the Environment Protection Authority (EPA) to DELWP in July 2015.
The expenditure from transactions increase of $188.4 million is primarily represented by an increase in grants and other transfers of $172.2 million due to a full year of grants being paid to local councils. The Local Government output transferred to the department as a result of MoG changes effective 1 January 2015. Major local government programs/projects included the public libraries funding program and the interface councils infrastructure fund.  Other items contributing to this result include an increase in expenditure on Supplies and Services predominantly represented by funds transferred from DELWP’s controlled entity to the administered entity to allow contributed capital payment to GMW for the Connections Stage 2 project.  These increases were partially offset by decreases in the Capital Asset Charge ($11.0 million) and depreciation expenditure ($15.3 million) representing six months of charges on assets transferred to DEDJTR as part of the 1 January 2015 MoG, specifically assets associated with the Biosciences Research Centre and Showgrounds Private Public Partnerships.
Other economic flows included in net result decreased by $57.8 million largely due to the derecognition of land parcels arising from the department’s ongoing whole of Victorian Government Crown Land Reconciliation project.
Financial position – balance sheet
Total assets increased by $1,235.9 million to $9,817.5 million primarily due to the increase in asset values resulting from the independent valuation of Public Safety and Environment asset purpose group of $946.9 million, managerial valuation of Public Administration asset purpose group of $22.1 million, $8.5 million for the states share of its investment in  Property Exchange Australia Limited (PEXA Ltd)  and contributions from owners of  $304.3 million which included the transfer of the Sustainability Fund to the department from EPA and other capital funding from the State.  This was partially offset by the decrease in prepayments of $71.1 million associated with the GMW Connections Project as they continued to deliver their obligations. 
Total liabilities reduced by $12.2 million primarily due to a general reduction in trade creditors and accruals due to better historical analysis of accrued expenses and earlier payment of creditors.  Consequently DELWP’s net assets increased by $1,248.2 million or 15.1 per cent from last year to $8,285.7 million.
Cash flows
DELWP’s net cash inflow from operating activities decreased by $171.4 million to  $140.1 million. This decrease in cash reflects the DELWP net result from transactions for the year, adjusted for the impact of non-cash items such as depreciation.
Subsequent events
Machinery of Government Changes
On 23 May 2016, the Premier Daniel Andrews announced changes to the Ministry. The department assumed responsibility for the Energy output from 1 July 2016. This output transferred from DEDJTR and will result in an increase in net assets and contributed capital (equity). The net asset transfer is estimated to be $1.2 million.
Investment in Property Exchange Australia Limited
On 1 July 2016, the department’s investment in PEXA Ltd transferred to the Department of Treasury and Finance.
The transfer has resulted in a $11.3 million decrease in investments accounted for using the equity method (asset) and in contributed capital (equity).
Departmental controlled expenses from transactions by output
DELWP payments for outputs (controlled)	$’000	%	
Environmental Policy	38,361	2.3	
Environmental Programs	74,076	4.4	
Statutory Activities and Environment Protection	93,435	5.6	
Effective Water Management and Supply	454,851	27.3	
Local Government	120,063	7.2	
Planning, Building and Heritage	72,445	4.3	
Fire and Emergency Management	396,499	23.8	
Management of Forests, Parks, and Public Land	328,231	19.7	
Land Victoria	89,807	5.4	
	1,667,768 	100.00	

Note:
As per controlled expenses from transactions in Note 2 of the DELWP 2015-16 financial statements.

Financial governance
The department diligently exercises its various financial management obligations. The Minister for Finance has implemented various financial governance frameworks to ensure effective, efficient and responsible financial management of public resources, including the Financial Management Compliance Framework (FMCF). The FMCF governs compliance with the provisions of the Financial Management Act 1994, Taxation Compliance Rules, Purchasing Card Rules for Use and Administration and Thefts and Losses Rules. 
The FMCF provides assurance that all public entities:
have implemented appropriate systems for the effective, efficient and responsible financial management of public resources and provides a mechanism for government to monitor and review compliance with legislation
are complying with legislation in relation to the major federal taxes including GST, FBT and PAYG
have implemented efficient and effective use of purchasing cards
report all instances of thefts and losses to the Minister for Finance on an annual basis.
The department’s compliance with the Direction Requirements of the FMCF is formally assessed at 30 June each year and the tax compliance component is subject to an independent review.
During 2016, the Minister for Finance issued new Standing Directions that will take effect from 1 July 2016. Existing requirements have been streamlined, clarified and tailored to a range of different agencies. The 2016 Directions will drive a significant modernisation of the state’s financial management regime and operations.
The department also maintains a number of financial policies, procedures and guidelines to ensure consistency in financial transactions and financial reporting. These are reviewed and updated on an annual basis to ensure ongoing relevance and conformance to external reporting requirements.

Financial transactions are subject to regular compliance reviews by the compliance team within the Finance and Planning division. Compliance reviews include Financial Data Quality Assurance Reviews and Purchasing Card transaction reviews. Exceptions identified during the compliance reviews are reported to the Executive Director, Finance and Planning (who is also the department’s Chief Finance and Accounting Officer for the purposes of section 43(1) (a) of the Financial Management Act 1994). In 2016-17, this activity will be further strengthened with the purchase of data interrogation software that will allow detailed analysis of all of the department’s financial transactions. The system will be rolled out over the next 12-18 months commencing with Accounts Payable data in September 2016. 
Governance of Financial Management training is provided online to all staff applying for the right to exercise financial delegations within the department. All financial delegates are required to repeat the training every four years.
There is active participation in financial management amongst leadership teams throughout the department and financial compliance continues to be embedded into revised work practices. Regular communication of the requirements will continue through financial forums and daily work practices. 
These activities form part of the department’s commitment to championing a culture of integrity within the public sector.
Budget portfolio outcome statements 
A comparison of the budget portfolio outcome statements for the department, as published in the 2015-16 Budget Paper No. 5, and the actual results for the year can be found at Appendix 2.

Our people 
Our aspiration is to have a workforce that represents the communities in which we operate and our employees live.  
The department employs 3,092 full time equivalent staff, who work from more than 100 locations across Victoria.
We are committed to fostering a culture where our employees are provided with opportunities to develop, are valued for their contribution and can work flexibly and safely to deliver great value and services to Victorian communities and stakeholders.
For instance, in 2015, the department participated in the Victorian Public Sector Commission’s People Matter Survey. Following on from the survey, DELWP staff were trained as internal facilitators to manage staff focus groups aimed at identifying and exploring areas for improvement.
Wellbeing and safety
At DELWP we protect the wellbeing and safety of our people and ensure that safety is integral to how we do our work. 
The department actively supports the physical and psychological wellbeing of our people and promotes a healthy workplace by maintaining safe systems of work. 
The wellbeing and safety of our people is fundamental to the successful delivery of our work programs and a critical factor in supporting our lead-agency role in on-ground activities, especially public land and fire management.
Our commitment to wellbeing and safety is based on four key pillars: Lead, Understand, Act and Improve, which are reflected in the Safety and Wellbeing Strategic Framework.
Wellbeing programs
Approximately 100 staff have volunteered their time to become trained DELWP Peer Supporters.  
There were 245 new referrals to the DELWP Employee Assistance Program in 2015-16.

The wellbeing of our staff is further supported through the delivery of:
annual Flu Vaccination Program
annual Walk Through Winter Challenge
workplace support plans for work and non-work related injuries or illnesses
wellbeing check-in’s following critical incidents
access to a wide range of health services. 
Safety programs
DELWP’s Safety and Wellbeing team undertook more than 430 site and field audits across the state during 2015-16, resulting in major improvements in operational areas of DELWP businesses. 
They were engaged in more than 420 other activities, including providing support and advice, emergency response and process review, preliminary investigations, chemical risk assessments, manual handling, and slips trips and falls assessments.
In 2015-16, a number of safety programs were rolled out including:
manual handling
slips, trips and falls
provision of first aid to staff who work in remote locations
asbestos awareness
volunteer safety management
driver safety project
chemical management and handling.
The driver safety project was established specifically to respond to an emerging risk, which has resulted in a technical training project. The project included a review and update of driver training programs, the implementation of a revised training and internal accreditation program and a strategic investigation process around vehicle incidents.
A review of DELWP’s procedures to manage asbestos was completed. Building on the learnings from the Wye River fire response, an updated Asbestos Awareness training program was launched in May 2016. 

Key achievements for the year
Implemented a major upgrade to the Infosafe chemical inventory management system, which resulted in improved functionality across all DELWP sites.
Implemented a ‘Leading Safety and Wellbeing in DELWP’ program for managers and executives with 922 staff attending (approximately 63 per cent of managers and 60 per cent of executives).
Conducted training for more than 3,200 participants across various safety awareness courses. 
Updated our approach to dealing with WorkCover claims and return to work issues using manager education and with early intervention methodologies, which has contributed to a significant reduction in DELWP’s WorkCover premiums for the second year in succession.
Transitioned the medical standards function to the People and Culture division to enable a broadening of the program to encompass the ‘All Hazards, All Communities’ approach. A project team was established to undertake both task and risk analysis of approximately 200 fire roles along with administering more than 1,700 Fit for Fire assessments.
Investigated more than 200 potential breaches of relevant appropriate behaviour policies, safety investigations and notifiable incidents.
Implemented a safety duty phone service operating 24 hours a day, enabling staff access to expertise at short notice. This has resulted in approximately 120 calls for assistance across the department. 
Diversity and inclusion
The department is committed to building an inclusive workplace that utilises the full potential of employees, embraces difference and uses diversity of thought as a catalyst for innovation and improved service delivery for Victorian communities.
Working flexibly has been a strong driver for improving work-life balance and recognising the changing needs of employees at different points in their career cycle. 
DELWP reported on actions taken to deliver on our responsibilities under the Charter of Human Rights and Responsibilities, the Victorian State Disability Plan and for Multicultural Affairs. DELWP is also a member of the Diversity Council of Australia.
Programs and activities
DELWP is a proud contributor and participates in a broad range of activities that raise awareness, celebrate diversity and lead to behaviour change through events including: R U OK Day; National Aboriginal and Islanders Observance Committee Week (NAIDOC); Carers week; International Day for People with a Disability; International Women’s Day; Human Rights Day; Midsumma Festival; Cultural Diversity Week; Reconciliation Week; International Day Against Homophobia, Transphobia and Biphobia; and Go home on time day.
Key achievements for the year
Diversity and Inclusion Council
In 2015-16, DELWP established a Diversity and Inclusion Council to focus on the diversity and inclusion agenda, connect it to DELWP’s strategic business direction and support DELWP becoming an employer of choice.
Munganin-Gadhaba
In December 2015, the Minister for Aboriginal Affairs, Natalie Hutchins, launched the DELWP Aboriginal inclusion plan Munganin – Gadhaba, meaning ‘Achieve Together’, which sets out DELWP’s approach to inclusion for 2016 – 2020.
The name Munganin – Gadhaba is from the Taungurung language, and brings to life the department’s aim to work in partnership with Traditional Owners and Aboriginal communities across the state.
The plan outlines around 60 actions to achieve the outcomes of Recognition and Respect, Opportunity and Prosperity, and Participation and Collaboration.
Manganin-Gadhaba includes an Aboriginal Employment Plan that was launched in March 2016. The plan recognises the need to build and strengthen our relationships with Traditional Owners and to work with Aboriginal communities across the state to provide employment, training and business opportunities to Aboriginal people living in Victoria.
The DELWP Aboriginal Employees Network was also established as part of the Aboriginal Employment Plan initiative in Munganin-Gadhaba. 

Lesbian, Gay, Bisexual, Transsexual and Intersex (LGBTI)
During 2015-16, DELWP continued to offer an independent Lesbian, Gay, Bisexual, Transsexual and Intersex (LGBTI) Employee Assistance Program and maintained DELWP’s membership of Pride in Diversity (PiD) - a not-for-profit organisation to support LGBTI inclusion. Together with PiD, ‘LGBTI awareness in the workforce’ training has been offered to staff and a strategy has been commenced to develop the DELWP Pride network.
Gender equity
The department is a strong advocate for gender equity. The Gender Equity Action Plan guides the DELWP approach and in 2015-16 more than 80 employees participated in targeted development programs for women. The department established the Women’s Networking Program, which connects women with each other and key stakeholders in the organisation.
DELWP also continued to invest in a number of networking, training and leadership opportunities for women to help build their careers in the public sector. Also, research was commissioned to better understand the barriers impacting women moving into leadership positions in Fire and Emergency roles. This resulted in more than 700 women and men providing insight into what stops women taking on operational roles and, more specifically, leadership positions.  An action plan is being developed for release in 2016-17.
Developing our people
In 2015-16, significant and ongoing investment in leadership and management training continued as we built managerial skills in our highly technical, science-based and community centric workforce.
DELWP also continued to invest in recruitment programs for science, accounting and finance and generalist graduates to build ongoing capability in the department.
Key achievements for the year
Conducted a department-wide DELWP Community Service and Interaction training program for more than 2,600 DELWP staff to support the successful implementation of the DELWP Community Charter.
Established a Workforce Capability Committee to help focus and drive investment in our people.
In line with our commitment to building a constructive culture, nearly 200 of our senior managers participated in a 360 degree feedback process and an associated ‘Leading behavioural change’ program.
Employment and conduct principles
The department applies the public sector values and employment principles as set out in the Public Administration Act 2004, including the application of merit and equity principles when appointing staff. The selection processes ensure the applicants are assessed and evaluated fairly and equitably on the basis of the key selection criteria and other accountabilities without discrimination. Employees have been correctly classified in workforce data collection.
Workplace relations
Negotiations for the new Field Staff Agreement 2016, the Wild Dog Controller Agreement 2016 and the Victorian Public Service Agreement 2016 all concluded in the second half of 2015-16.  The Victorian Public Service Agreement 2016 came into operation on 18 May 2016. The Field Staff and Wild Dog Controller Agreements are expected to be approved in 2016-17. 
The department also provides advice and assistance to portfolio statutory authorities to process their enterprise agreements.  In 2015-16, 17 management logs and 20 final agreements progressed through the approval process.
Grievances
In 2015-16, the department received 15 new grievances with two existing grievances being carried over from 2014-15.
2015-16: Grievances by outcome 
Outcome	Number	
Withdrawn	3	
Not substantiated	1	
Partially substantiated	0	
Substantiated	2	
Rejected	2	
No further action required	7	
Open	2	
Total	17	

OHS performance indicators 1
Description	Performance indicator	2014–15	2015–16	
Incidents and hazards1				
	Incidents	752	746	
	Lost time incidents 	93	98	
	Hazards	114	215	
	Incident rate per 100 FTE	15.822	21.032	
WorkCover3				
Claims	Number of standard claims	60	49	
	Rate per 100 FTE	1.49	1.22	
	Standard claims with lost time	38	35	
	Rate per 100 FTE	0.95	0.87	
Fatalities	Number of fatalities	0	0	
Claim costs	Average cost per claim ($)	$57,312	$47,277	
Return to work (RTW)	Percentage of RTW arrangements initiated for claims exceeding 20 days per 100 FTE	70.6%	70.6%	
Management commitment	Evidence of safety and wellbeing policy, strategy, regular reporting to senior management, safety criteria in purchasing guidelines	Achieved	Achieved	
Consultation and participation	Designated work group structure, health and safety representatives (HSR) and issue resolution procedure in place	Achieved	Achieved	
Risk management	Internal audits/inspections conducted as planned
Reporting of incidents and injuries
Investigation of incidents and corrective actions initiated	Achieved	Achieved	
Training	Safety and Wellbeing Induction
Job Safety Planning
HSR training
Management training	Achieved	Achieved	

Note:
1.	Data sourced from DELWP Safety Incident Management System (POSSUM).
2.	The incident and hazard rates based on 2015–16 FTE count represent March 2016 figures of 3,546.8 FTE and capture the majority of Project Firefighters. 
3.	The data is sourced from the Victorian WorkCover Authority. The 2015-16 rate is based on FTE count at 30 June 2016. This excludes external contractors/consultants and temporary staff employed by employment agencies.

Comparative workforce data
Profile of the DELWP workforce: June 2016
As at 30 June 2016, DELWP employed 3,092 full time equivalent (FTE) staff across Victoria. 
Table 1: FTE staffing trends 2012 to 2016
	2016	2015	2014	2013	2012	
Department	DELWP	DELWP	DEPI	DEPI	DSE	
Total staff (FTE)	3,092	2,960	3,470	2,328	2,617	

Note:
1.	Table reflects the name of the Department over the preceding five years.
Table 2: Summary of employment levels in June 2015 and June 2016 
	Ongoing Employees	Fixed Term and Casual	Total Staff				
	Employees
(headcount)	Full time (headcount)	Part time (headcount)	Ongoing FTE total	FTE fixed term and casual	Total staff FTE	
June 2016	2,898	2,398	500	2,733	359	3,092	
June 2015	2,836	2,376	460	2,684	276	2,960	

Table 3: Details of employment levels in June of 2015 and June 2016 
	2016	2015					
	Ongoing (headcount)	Ongoing (FTE)	Fixed Term and Casual (FTE)	Ongoing (headcount)	Ongoing (FTE)	Fixed Term and Casual (FTE)	
Gender							
Male	1,594	1,574	155	1,583	1,566	119	
Female	1,304	1,159	204	1,253	1,118	157	
Total	2,898	2,733	359	2,836	2,684	276	
Age							
Under 25	42	41	19	41	41	16	
25-34	544	520	130	494	475	103	
35-44	825	745	113	806	732	83	
45-54	753	723	67	713	680	50	
55-64	637	618	26	607	590	20	
Over 64	97	86	4	175	166	4	
Total	2,898	2,733	359	2,836	2,684	276	
Classification							
Field Staff	277	276	16	304	303	22	
VPS 1	0	0	0	4	2	1	
VPS 2	157	134	22	160	144	24	
VPS 3	597	559	62	576	542	46	
VPS 4	614	574	85	585	547	67	
VPS 5	606	564	106	585	542	60	
VPS 6	464	449	46	440	427	35	
STS	22	22	2	22	22	2	
Science Adaptives	53	52	10	54	52	8	
Legal Adaptives	20	18	0	16	14	1	
Executives	62	61	0	63	62	0	
Other	26	24	10	27	27	10	
Total	2,898	2,733	359	2,836	2,684	276	

Note:
Ongoing employees includes people engaged on an open ended contract of employment and executives engaged on a standard executive contract who were active in the last full pay period of June.
FTE means full time staff equivalent and is rounded to the nearest whole number.
Employees reported with a classification of ‘other’ include the following categories: Principal Scientist, Trainee and Wild Dog Controllers.
All figures reflect employment levels during the last full pay period in June each year.
Excluded are those on leave without pay or absent on secondment, external contractors/consultants, and temporary staff employed by employment agencies, and people who are not employees but appointees to a statutory office, as defined in the Public Administration Act 2004.
Employees attached to the Commissioner for Environmental Sustainability are employees of the Department Secretary and are included in the above figures.
Employees attached to Sustainability Victoria are employees of the Department Secretary and their numbers are included in following tables. Employee numbers are also reported in their annual report.
The Office of Living Victoria operated as an Administrative Office from 22 May 2012 until 30 June 2014. Its numbers are included the tables above for the 2015 disclosure.
The Environment Protection Authority is a discrete agency within this portfolio that employees public servants independently of the Department Secretary. The EPA is required to produce its own annual report. Employee numbers are published in the EPA annual report.

Profile of Sustainability Victoria workforce 
As at June 2016, Sustainability Victoria (SV) employed 109 FTE staff across Victoria. 
Table 1: Sustainability Victoria FTE staffing trends 2012 to 2016
2016	2015	2014	2013	2012	
109	112	111	106	113	

Table 2: Sustainability Victoria summary of employment levels in June 2016 and June 2015
	Ongoing Employees	Fixed Term and Casual	Total Staff				
	Employees
(headcount)	Full time (headcount)	Part time (headcount)	FTE	FTE	FTE	
June 2016	87	75	12	83	26	109	
June 2015	89	73	16	84	28	112	

Table 3: Sustainability Victoria details of employment levels in June 2016 and June 2015 
	2016	2015					
	Ongoing (headcount)	Ongoing (FTE)	Fixed Term and Casual (FTE)	Ongoing (headcount)	Ongoing (FTE)	Fixed Term and Casual (FTE)	
Gender							
Male	35	35	11	31	31	13	
Female	52	48	15	58	53	15	
Total	87	83	26	89	84	28	
Age							
Under 25	0	0	0	0	0	2	
25-34	13	13	12	15	15	10	
35-44	41	38	9	41	38	11	
45-54	20	19	2	21	19	3	
55-64	12	12	3	11	11	2	
Over 64	1	1	0	1	1	0	
Total	87	83	26	89	84	28	
Classification							
VPS 1	0	0	0	0	0	0	
VPS 2	0	0	0	0	0	0	
VPS 3	3	3	1	3	3	1	
VPS 4	29	27	8	33	30	7	
VPS 5	34	32	14	38	35	14	
VPS 6	16	16	3	14	15	1	
STS	1	1	0	0	0	0	
Executive 	4	4	0	5	5	0	
Total	87	83	26	89	84	28	

Note:
Ongoing employees includes people engaged in an open ended contract of employment and executives engaged on a standard executive contract who were active in the last full pay period of June. 
FTE means full time staff equivalent and is rounded to the nearest whole number.
All figures reflect employment levels during the last full pay period in June of each year.
Excluded are those on leave without pay or absent on secondment, external contractors/consultants, and temporary staff employed by employment agencies, and people who are not employees but appointees to a statutory office, as defined in the Public Administration Act 2004.
Sustainability Victoria Workforce numbers are also included in the Sustainability Victoria Annual Report.
Executive officer data 
An executive officer is defined as a person employed as a public service body head or other executive under Part 3, Division 5 of the Public Administration Act 2004. All figures reflect employment levels at the last full pay period in June of the current and corresponding previous reporting year. The definition of an executive officer does not include Governor in Council appointments as statutory office holders.
The total group of executives is classified into two categories based on the following definitions:
‘ongoing’ executives are executives who are responsible for function or outputs that are expected to be ongoing at the end of the reporting period
‘Special projects’ executives are executives who are employed for a specific project.  These projects are generally for a fixed term period of time and relate to specific government priority.

The following tables disclose the executive officers of the department for 30 June 2016:	
Table 1 discloses the number of executive officers in the categories of ‘ongoing’ and ‘special projects’ and the total numbers of executive officers for the department; 
Table 2 provides a breakdown of executive officers according to gender for the categories of ‘Ongoing’ and ‘Special Projects’;
Table 3 provides a reconciliation of executive numbers presented between the report of operations and Note 31 ‘remuneration of executives’ in the financial statements.	
Tables 1 to 3 also disclose the variations (Var.) between the current and previous reporting periods. Current vacancies are shown in table 2.
Profile of DELWP Executive Officers: June 2016 
Table 1: Number of Executive Officers classified into ‘ongoing’ and ‘special projects’ (including vacancies). Variances refer to difference between June 2015 and June 2016.
Class	All	Ongoing	Special Projects				
	No.	Var.	No.	Var.	No.	Var.	
Secretary	1	0	1	0	0	0	
EO-1	2	0	2	0	0	0	
EO-2	36	2	36	2	0	0	
EO-3	23	-3	23	-3	0	0	
Total	62	-1	62	-1	0	0	

Table 2: Breakdown of Executive Officers into gender
Class	Male	Female	Vacancies				
	No.	Var.	No.	Var.	No.	Var.	
Secretary	1	0	0	0	0	0	
EO-1	1	0	1	0	0	0	
EO-2	18	-1	18	3	3	0	
EO-3	12	-1	11	-2	2	0	
Total	32	-2	30	1	5	0	

The number of executives in the report of operations is based on the number of executive positions that are occupied at the end of the financial year. Note 31(a) in the Financial Statements lists the actual number of and amount of remuneration paid to executive officers over the course of the reporting period. The notes to the Financial Statements do not distinguish between executive levels, or disclose separations, vacant positions, executives whose remuneration is below $100,000, or include the accountable officer. Separations are those executives who received more than $100,000 in the financial year and have left the department during this year. To assist readers, these two disclosures are reconciled below.
Table 3: Reconciliation of executive numbers
	2016	2015	
Executives with total remuneration over $100,000	61	69	
Executive employed with total remuneration below $100,000	15	17	
Add			
Vacancies (Table 2)	5	5	
Accountable Officers (Secretary)	1	1	
Less			
Separations from DELWP	9	7	
Separations - MoG to DEDJTR	0	14	
Executives who moved to non-executive roles	1	1	
Executive Officers commenced leave without pay	2	2	
Ceased Executive Officers who received backpay	3	0	
Total executive numbers	67	68	

Note:
1.	At 30 June 2016, the department employed 62 executive officers and had five vacancies.

Profile of Sustainability Victoria Executive Officers: June 2016 
Table 1: Number of Sustainability Victoria Executive Officers into ‘ongoing’ or ‘special projects’ (including vacancies)
Class	All	Ongoing	Special Projects				
	No.	Var.	No.	Var.	No.	Var.	
Secretary	0	0	0	0	0	0	
EO-1	0	0	0	0	0	0	
EO-2	0	0	0	0	0	0	
EO-3	4	0	4	0	0	0	
Total	4	0	4	0	0	0	

Table 2: Breakdown of executive officers into gender
Class	Male	Female	Vacancies				
	No.	Var.	No.	Var.	No.	Var.	
Secretary	0	0	0	0	0	0	
EO-1	0	0	0	0	0	0	
EO-2	0	0	0	0	0	0	
EO-3	3	0	1	0	0	0	
Total	3	0	1	0	0	0	

Table 3: Reconciliation of executive numbers
	2016	2015	
Executives with total remuneration over $100,000	4	4	
Executives employed with total remuneration below $100,000	0	0	
Add			
Vacancies (Table 2)	0	1	
Accountable Officers (Secretary)	0	0	
Less			
Separations from SV	0	1	
Executives who moved to non-executive roles	0	0	
Executive Officers commenced leave without pay	0	0	
Total executive numbers	4	4	

Table 4: Executive numbers for the department’s portfolio agencies  
Organisation Name	June 2016	June 2015	Annual change							
	Female	Male	Total	Female	Male	Total	Female	Male	Total	
Architects Registration Board of Victoria	0 	0	0	1	0	1	-1	0	-1	
Barwon Coast Committee of Management	0 	1	1	 0	1	1	 0	 0	0 	
Barwon Region Water Corporation (Barwon Water)	3	14	17	3	14	17	 0	 0	0 	
Barwon South West Waste and Resource Recovery Group	1	 0	1	1	 0	1	 0	 0	 0	
Bellarine Bayside Foreshore Committee of Management Inc	 0	1	1	 0	1	1	0 	0 	0 	
Capel Sound Foreshore Committee of Management	1	 0	1	1	0 	1	0 	 0	 0	
Central Gippsland Region Water Corporation  (Gippsland Water)	1	9	10	2	9	11	-1	0 	-1	
Central Highlands Region Water Corporation (Central Highlands Water)	1	5	6	1	4	5	0 	1	1	
City West Water Corporation	1	7	8	3	6	9	-2	1	-1	
Coliban Region Water Corporation (Coliban Water)	 0	6	6	1	6	7	-1	0 	-1	
Corangamite Catchment Management Authority	0 	1	1	0 	1	1	 0	 0	0 	
East Gippsland Catchment Management Authority	0 	1	1	0 	1	1	 0	 0	0 	
East Gippsland Region Water Corporation (East Gippsland Water)	 0	5	5	 0	5	5	 0	0 	0 	
Falls Creek Alpine Resort Management Board	 0	3	3	 0	3	3	 0	 0	 0	
Gippsland & Southern Rural Water Corporation (Southern Rural Water)	0 	4	4	 0	4	4	0 	0 	0 	
Gippsland Ports Committee of Management Inc	 0	1	1	0 	1	1	 0	0 	0 	
Gippsland Waste and Resource Recovery Group	0 	1	1	 0	1	1	0 	0 	0 	
Glenelg Hopkins Catchment Management Authority	0 	1	1	 0	1	1	 0	 0	 0	
Goulburn Broken Catchment Management Authority	1	1	2	1	1	2	 0	 0	 0	
Goulburn Valley Region Water Corporation (Goulburn Valley Water)	 0	3	3	 0	4	4	 0	-1	-1	
Goulburn Valley Waste and Resource Recovery Group	0 	1	1	 0	1	1	 0	0 	0 	
Goulburn-Murray Rural Water Corporation (Goulburn-Murray Water)	2	4	6	2	4	6	 0	0 	0 	
Grampians Central West Waste and Resource Recovery Group	0 	1	1	0 	1	1	0 	0 	0 	
Grampians Wimmera Mallee Water Corporation (GWM Water)	1	3	4	1	4	5	 0	-1	-1	
Great Ocean Road Coast Committee	0 	1	1	0 	1	1	0 	0 	0 	
Lake Mountain Alpine Resort Management Board	0 	1	1	0 	 0	0 	 0	1	1	
Loddon Mallee Waste and Resource Recovery Group	1	0 	1	1	 0	1	 0	0 	0 	
Lower Murray Urban and Rural Water Corporation (Lower Murray Water)	1	5	6	1	7	8	 0	-2	-2	
Mallee Catchment Management Authority	1	0 	1	1	0 	1	 0	 0	0 	
Melbourne Water Corporation	2	9	11	16	35	51	-14	-26	-40	
Metropolitan Planning Authority	2	6	8	1	6	7	1	 0	1	
Metropolitan Waste and Resource Recovery Group	 0	1	1	1	3	4	-1	-2	-3	
Mount Baw Baw Alpine Resort Management Board	 0	1	1	0 	 0	0 	 0	1	1	
Mount Buller and Mount Sterling Alpine Resort Management Board	0 	2	2	1	2	3	-1	0 	-1	
Mount Hotham Alpine Resort Management Board	0 	1	1	0 	1	1	0 	0 	 0	
North Central Catchment Management Authority	 0	1	1	0 	1	1	0 	 0	0 	
North East Catchment Management Authority	0 	2	2	 0	2	2	0 	0 	0 	
North East Region Water Corporation	1	4	5	1	4	5	 0	0 	0 	
North East Waste and Resource Recovery Group	1	 0	1	1	0 	1	 0	 0	0 	
Parks Victoria	7	12	19	9	9	18	-2	3	1	
Phillip Island Nature Park Board of Management	 0	1	1	0 	1	1	 0	 0	 0	
Port Phillip and Westernport Catchment Management Authority	 0	1	1	0 	1	1	 0	 0	 0	
Royal Botanic Gardens Board	1	5	6	1	5	6	0 	 0	0 	
South East Water Corporation	4	22	26	4	22	26	 0	0 	 0	
South Gippsland Region Water Corporation (South Gippsland Water)	 0	4	4	 0	4	4	 0	 0	0 	
Sustainability Victoria	1	4	5	1	4	5	0 	 0	0 	
The Mint Incorporated	0 	1	1	1	0 	1	-1	1	0 	
Trust for Nature (Victoria)	1	0 	1	1	0 	1	0 	0 	 0	
Urban Renewal Authority (Places Victoria)	3	18	21	3	15	18	 0	3	3	
Victorian Building Authority	3	4	7	3	6	9	0 	-2	-2	
Wannon Region Water Corporation (Wannon Water)	1	4	5	 0	5	5	1	-1	0 	
West Gippsland Catchment Management Authority	 0	2	2	0 	2	2	 0	 0	 0	
Western Region Water Corporation (Western Water)	3	3	6	3	3	6	0 	 0	0 	
Westernport Region Water Corporation (Westernport Water)	 0	1	1	1	2	3	-1	-1	-2	
Wimmera Catchment Management Authority	 0	1	1	0 	1	1	 0	 0	0 	
Winton Wetlands Committee of Management	0 	1	1	 0	1	1	 0	 0	0 	
Yarra Valley Water Corporation	1	7	8	6	28	34	-5	-21	-26	
Zoological Parks and Gardens Board	5	4	9	4	3	7	1	1	2	
	51	202	253	78	247	325	-27	-45	-72	

Note:
All figures reflect employment levels during the last pay full period in June of each year unless otherwise stated.
Excluded are those on leave without pay or absent on secondment, external contractors / consultants and temporary staff employed by employment agencies.
For the purpose of this table, Executive Officers are defined as employees who have significant management responsibility AND receive a TRP of $152,560 or more.
Architects Registration Board of Victoria has declared that they do not have executives that meet the criteria.
Melbourne Water Corporation and Yarra Valley Water Corporation have applied their own criteria to determine which staff have significant management responsibilities and this has reduced the number of staff included in the list as executives in 2015-16.

Office-based  environmental performance 
Office-based environmental impacts
DELWP’s Environment Management System (EMS) is set up to meet government requirements and to reduce the department’s impact on the environment. The initial focus has been on the department’s office based activities in the areas of energy and paper consumption, transportation, waste generation, water consumption, and green procurement. The program is independently audited biennially by an environmental auditor appointed under the Environment Protection Act 1970.
DELWP’s EMS objectives are to:
refine and maintain an EMS that drives continual improvement across the department
clearly communicate the Environmental Policy Statement and responsibilities to staff and contractors
set targets and objectives to minimise waste, environmental harm and pollution associated with departmental operations
ensure operational activities meet or better the requirements of environmental legislation and government policy, and adopt best practice environmental procedures and guidelines
minimise the consumption of water, energy, materials and other resources in all operational areas through discipline and innovation
ensure new capital works incorporate comprehensive environmental sustainability principles
incorporate environmental principles, and where possible, life cycle costing in decision making and procurement processes
ensure departmental staff have the ability to achieve the above policy objectives
share our achievements and learnings with other departments
monitor, measure and publicly report our environmental performance.
DELWP’s accommodation portfolio is spread across Victoria and includes:
offices 
depots 
incident control centres
a research centre (Arthur Rylah Institute)
residences 
air bases.
DELWP exceeds statutory reporting obligations under Financial Reporting Direction (FRD) 24C to report on the environmental impact of its office-based activities, by reporting on a wide range of its facilities and operations.  
DELWP reports on 69 sites covering 92 per cent of FTE (2,844 FTEs of total 3,092). The reportable site list excludes residences, sites where there are fewer than 10 FTE, and where DELWP staff are located within another department’s facility (for example Attwood and Horsham). Non-DELWP staff accommodated within a DELWP managed facility are counted towards the DELWP reported consumption figures as per FRD 24C guidance. 
Reportable sites are used for emergency response, which can have significant impacts on resource use across the department.
Key achievements
The key achievements for DELWP in 2015-16 include:
launch of the DELWP Green Team Strategy, Environmental Policy Statement and Environmental Action Plan 2015-18
development of sustainable construction guidelines for new builds and refurbishments
16 per cent reduction in LPG consumption and related greenhouse gas emissions
26 per cent reduction of waste per FTE to landfill
8 per cent reduction in waste-related greenhouse gas emissions
3.6 tonne of waste material diverted from landfill via Green Collect recycling 
reduction in paper purchase with 0-49 per cent recycled content
increase in paper purchase with 75-100 per cent recycled content
11 per cent increase in staff travelling by sustainable modes of transport to and from work.
Green Team program
The Green Team program aims to promote awareness of environmental objectives by encouraging positive environmental behaviours across the department. A group of approximately 100 Green Team champions help develop, implement and refine a range of site-based initiatives and activities aimed at encouraging staff to improve performance in reducing energy, water and paper use as well as waste to landfill.
Energy 
The data presented below was collected through energy retailer billing information and represents 96 per cent of FTE and 98 per cent of work area (m2) for DELWP’s reported sites. This covers 149,602 m2 for DELWP, in comparison to 134,848 m2 in 2014-15. 
Total energy usage (E1) increased by 10 per cent in 2015-16, mainly due to a small increase in natural gas consumption and an increase of 16 per cent in FTE at reported sites. Recent construction at Broadford saw the introduction of natural gas on-site, which contributed to a quarter of the natural gas increase. Natural gas is typically used for heating during the winter months which may explain small increases at the remaining five DELWP sites with natural gas, as the 2015 winter was slightly colder on average in comparison to 2014.
LPG consumption reduced by 16 per cent in 2015-16 compared to 2014-15, as sites such as Broadford switched to natural gas.
Mega joules (MJ) of office electricity per m2 (E5) is based upon offices where consumption is separately metered. In 2015-16 this metric covered 16 offices, 29 per cent of m2 (43,945 m2) and 81 per cent of FTE (2,294 FTE) of DELWP’s reported sites. A slight increase in mega joules per m2 is in line with the overall increase of energy across DELWP. 
Indicator	2015-16	2014-15								
	Electricity	Natural gas	LPG	Green power	Electricity	Natural gas	LPG	Green power		
E1	Total energy usage segmented by primary source (MJ)	30,940,817	9,358,660	629,000	0	28,819,100	7,566,447	751,878	0	
E2	Greenhouse gas emissions associated with energy use, segmented by primary source and offsets (t CO2-e)	9,712	482	1,525	0	9,217	388	1,747	0	

Indicator	2015-16	2014-15		
E3	Percentage of electricity purchased as green power	0	0	
E4	Units of energy used per FTE (MJ/FTE)	13,235	12,311	
E5	Units of energy used per unit of office area (MJ/m2)	371	354	

Note:
The 2014-15 LPG greenhouse gas emissions figure (E2) was incorrectly reported in the 2014-15 Annual Report. The correct figure has been included in the above table.
m2 covers all under cover areas that have power supplied including offices, staff amenities and sheds.
E1, E2, E3, E4 cover 149,602 m2 and 2,726 FTE.
E5 covers 43,945 m2 and 2,294 FTE.
Mean temperature data was taken from the Bureau of Meteorology website where trend data shows a small increase from 2014-15 to 2015-16.
Electricity data excludes 2 Lonsdale Street Melbourne due to data unavailability. This facility covers  4.1 per cent of FTE and 1.5 per cent of m2 at reportable sites.
4.3 per cent of electricity data has been estimated based on the previous year’s consumption due to a lag in receiving data.
DELWP reports from April 1 – March 31 to allow for a full reporting year.
Conversion factors are taken from the National Greenhouse Accounts Factors July 2015.

Actions undertaken		
Stage 1 Type 3 energy and water audits 	Audits were undertaken at 12 facilities across the Loddon Mallee, Grampians and Hume regions.  Audits identified a range of efficiency measures that are currently being implemented such as LED lighting upgrades, mechanical services upgrades, building envelope and HVAC opportunities.	
Solar photo voltaic (PV) roof installation	Feasibility studies were undertaken for solar installation at nine facilities with total capacity of 285 kilowatts (kW). Installation is expected to occur in early 2016-17.	
Solar PV guidelines	Developed guidelines to standardise solar installation and provide project managers with guidance on installing solar PV across DELWP facilities.	
Greener Government Buildings program ‘Quick Win’	DELWP is in the process of replacing all office incandescent and halogen globes with LED globes in line with this program.	
Upgrade of 8 Nicholson Street	An upgrade and refurbishment of 8 Nicholson Street is in process, which will see the building move to a 5 star NABERS rating. 	
Sustainable construction guidelines 	DELWP identified a suite of environmental sustainability considerations and initiatives that could be incorporated into existing building design and construction processes, including an assessment of how this is currently integrated into design and construction.  As a result, a design checklist was developed and is incorporated into all tenders.  An audit checklist was also developed for use during the construction phase of projects to assist in reviewing contractor construction environmental management plans.	
Earth Hour	DELWP participated in the annual Earth Hour, highlighting its commitment to reducing energy consumption.	

Targets
The following targets have been set for 2016-17:
Progressively reduce energy consumption across DELWP owned and managed facilities
Undertake Stage 2 of the energy efficiency program, including Type 3 audits across the  DELWP portfolio
Continue to install solar photo voltaic systems where feasible
Implement pledges as part of TAKE2 on Climate Change action. 

Waste
Waste generation is divided into three general classes – landfill, compost and recycling. 
The data presented below is derived from  waste audits conducted at nine sites covering non-hazardous solid waste material. It should be noted the list of sites audited varied from 2014-15 to 2015-16 due to refurbishments at  8 Nicholson Street (excluded in 2015-16).  Although still in line with 30 per cent FTE coverage requirement of FRD24C, the  2015-16 audits resulted in a lower number  of FTE covered in comparison to 2014-15.
Although total waste generated increased, the amount of material being composted or recycled increased, evident with an improved recycling rate, and associated emission reduction. Figure 1 compares the change of waste make-up between 2014-15 and 2015-16.  
Figure 1: Change in make-up of waste generated
Indicator	2015-16	2014-15						
		Landfill	Co-mingled recycling	Compost	Landfill	Co-mingled recycling	Compost	
Ws1	Total units of waste disposed of by destination (kg/yr)	46,015	117,233	25,233	30,135	73,890	4,290	
Ws2	Units of waste disposed of per FTE by destinations  (kg/FTE)	15	38	8	20	49	3	

Indicator	2015-16	2014-15		
Ws3	Recycling rate (percentage of total waste)	76	78	
Ws4	Greenhouse gas emissions associated with waste disposal (t CO2-e)	67	73	

Note:
The 2014-15 waste figures were incorrectly reported in the 2014-15 Annual Report. The correct figures are included in the above table.
The 2015-16 waste audits involved measuring general waste and recycling for contamination and composition, collected by the cleaners on a sample day. The audits were undertaken at the following locations:
570 Bourke Street, Melbourne
Alexandra Office/Depot
Arthur Rylah Institute (Heidelberg)
Bairnsdale Office
Benalla Office
Bendigo Office/ Depot
Geelong Office
Knoxfield Office
Traralgon Office.
The 2015-16 waste audits covered 1,111 FTE including 932 DELWP FTE (30 per cent of total DELWP FTE) and 179 other government staff located within the facilities. This meets the FRD 24C requirement of 30 per cent staff coverage.
Waste data recorded during the site audits is extrapolated to represent a reporting year’s waste at all reportable sites in kilograms.
Co-mingled recycling comprises a range of plastics, aluminium, glass, paper and cardboard, but excludes material collected as part of the Green Collect scheme.
Conversion factors are taken from the National Greenhouse Accounts Factors July 2015.
Actions undertaken		
Pre-loved Stationery redistribution for 8 Nicholson Street refurbishment	As part of Corporate Services relocating to 385 Bourke Street for the  8 Nicholson Street refurbishment, pre-loved stationery bins were set up for stationery items that were no longer needed, but in good condition. Over 400 folders, 200 markers and pens, 70 Post-it notepads, 50 page divider packets, 750 plastic pockets and sleeves, 15 boxes of labels and over 1,200 bulldog and paper clips, and a range of other miscellaneous items were collected and diverted from landfill.	
General Green Collect collection	In addition to the material collected as pre-loved stationery and the general co-mingled recycling, DELWP diverted  more than 3.6 tonne of metal, plastics, batteries, mobile phones and accessories, small e-waste and stationery through the Green Collect recycling scheme.	
Hard hat recycling	98 per cent of all hard hats used are recycled into building products (over 2,000 annually).	
Asset auction services	Assets such as chainsaws, brushcutters, mobile ladders, heavy plant, etc.  are sold through public auction instead of being disposed of into landfill.	

Targets
The following targets have been set for 2016-17:
Progressively reduce total waste to landfill across DELWP facilities.
Continue to implement current waste initiatives across all DELWP sites.
Paper
DELWP measures paper use by reams purchased across its offices. DELWP’s preferred paper stock has a recycled content of 80 percent. 
The category ‘50-75% recycled content copy paper’ (P3) comprises 50 per cent recycled content A4 paper sourced primarily to cover  ‘out of stock’ periods of the preferred paper.  The category ‘0-49% recycled content copy paper’ (P3) is almost entirely comprised of
A3 sized and coloured A4 papers, which are unavailable in higher recycled content.
DELWP’s total paper purchase increased by 17 per cent, however when comparing the breakdown of recycled content, it is clear DELWP has improved its purchasing habits.  In 2015-16, 84 per cent of all paper had a 75-100 per cent recycled content (78 per cent in 2014-15) while the 0-49 per cent category had a reduction of 32 per cent in comparison to 2014-15.
Figure 2: Recycled content of paper breakdown
Indicator	2015-16	2014-15		
P1	Total units of copy paper used (reams)	35,332	30,280	
P2	Units of copy paper used per FTE (reams/FTE)	11	10	
P3	Percentage of 75-100% recycled content copy paper purchased 	84%	78%	
	Percentage of 50-74% recycled content copy paper purchased 	4%	4%	
	Percentage of 0-49% recycled content copy paper purchased 	12%	18%	

Note:
P1, P2 and P3 cover 3,092 FTE.
DELWP reports from April 1 – March 31 to allow for a full reporting year.
Actions undertaken		
Printing practices	DELWP encourages practices such as defaulting computers to print duplex and in some locations, employs secure printing, which has been shown to reduce paper consumption through reducing unwanted printouts.	
Default paper	Default copy paper purchased through our stationary supplier is 80 per cent recycled content. If this is unavailable, supply defaults to 50 per cent recycled content. Some sites choose to use 100 per cent recycled content.	

Targets
The following target has been set for 2016-17:
Progressively reduce total units of A4 equivalent copy paper used (reams) per FTE.

Water 
Water data was collected through water retailer billing information and represents 89 per cent of FTEs and 96 per cent of m2 for DELWP’s reported sites.
Water is used in offices (drinking, washing, toilet flushing), building heating and cooling and for vehicle wash-down. DELWP also uses water from bores, local waterways and captures stormwater to subsidise its water use, which is not measured or reported.
DELWP reduced its total water consumption by 25 per cent in comparison to 2014-15, which can be contributed to projects such as harvesting rainwater for wash down bays and amenities.
Indicators W2 and W3 are based upon a subset of the portfolio where office consumption is separately metered.  In 2015-16 this metric covered 13 offices, 24 per cent of m2 (36,984 m2) and 85 per cent of FTE at DELWP’s reported sites. 
Indicator	2015-16	2014-15		
W1	Total units of metered water consumed by usage types (kilolitres)	36,157	48,008	
W2	Units of metered water consumed in offices per FTE (kilolitres/FTE)	7.2	8.1	
W3	Units of metered water consumed in offices per unit of office area (kilolitres/m2)	0.4	0.3	

Note:
W1 covers 145,543 m2 and 2,532 FTE
W2 and W3 cover 36,984 m2 and 2,082 FTE
Water data excludes 2 Lonsdale Street and 1 Spring Street Melbourne due to the unavailability of consumption data. These facilities cover 11 per cent of FTE and 4 per cent of m2 at reportable sites
2.8 per cent of water data has been estimated based on the previous year’s consumption due to a lag in receiving data
A meter issue identified in 2014-15 (where one of two meters was not working) at 8 Nicholson Street, East Melbourne, was rectified in 2015-16, resulting in an increase in water use recorded at this facility. This facility is DELWP’s largest water user. The increase has been accounted for in the water metrics above. 
DELWP reports from April 1 – March 31 to allow for a full reporting year. 
Actions undertaken		
Stage 1 Type 3 energy and water audits 	Type 3 audits undertaken at 12 facilities across the Loddon Mallee, Grampians and Hume regions.  Audits identified a range of efficiency measures that are currently being implemented such as installation of rainwater tanks, plumbing rainwater tanks into the amenities and wash down bays, and installation of flow aerators.	
Sustainable construction guidelines	DELWP identified a suite of environmental sustainability considerations and initiatives that could be incorporated into existing building design and construction processes, including an assessment of how this is currently integrated into design and construction.  As a result, a design checklist was developed and is incorporated into all tenders.  An audit checklist was also developed for use during the construction phase of projects to assist in reviewing contractor construction environmental management plans.	

Targets
The following targets have been set for 2016-17:
Progressively reduce water consumption per FTE
Continue implementing the water efficiency program across the DELWP portfolio.
Transport
Fleet
The department’s fleet comprises 848 vehicles, 95 per cent of which are operational vehicles, with the executive fleet accounting for the remainder. Of the operational fleet, one per cent are LPG, 17 per cent unleaded, 77 per cent diesel fuelled and three per cent are hybrid. The executive fleet comprised 67 per cent unleaded, 29 per cent diesel fuelled and five per cent hybrid vehicles. 
In 2015-16, changes to DELWP’s fleet resulted in a change to the fuel make-up of vehicles. Twenty per cent of the fleet consisted of unleaded vehicles (in 2014-15, 11 per cent),  77 per cent of diesel (in 2014-15, 81 per cent)  with LPG vehicles staying approximately  1 per cent (see figure 3).  In 2015-16, kilometres travelled increased by 4 per cent in comparison to 2014-15, which is reflected in the increase of associated greenhouse gas emissions.
Figure 3: Change in make-up of vehicles

Indicator	2015-16	2014-15						
	Unleaded 	LPG	Diesel	Unleaded 	LPG	Diesel		
T1	Total energy consumption by vehicles (MJ)	9,950,809	707,646	80,103,558	9,575,800	945,636	70,805,395	
T2	Total vehicle travel associated with entity operations (km)	4,061,952	223,232	14,191,626	4,198,336	429,138	13,058,929	
T3	Greenhouse gas emissions from vehicle fleet segmented by vehicle type (t CO2-e)	671	27	5,634	641	57	4,943	
T4	Greenhouse gas emissions from vehicle fleet per 1,000 km travelled (t CO2-e)	0.17	0.12	0.40	0.15	0.13	0.38	

Note:
T1 – T4 covers 3,092 FTE.
DELWP reports on all operational vehicles including those required to respond to emergencies. The data also includes usage from the Shared Services Provider.
DELWP reports from April 1 – March 31 to allow for a full reporting year. 
Air travel
Air travel includes intrastate, interstate and overseas trips. In 2015-16 short haul flights increased by 29 per cent, medium haul flights by 17 per cent, and long haul flights by 62 per cent. 
Indicator	2015-16	2014-15		
T5	Total distance travelled by air (km)	4,120,798	3,077,565	

Note:
T5 covers 3,092 FTE.
The increase in long haul flights is a result of Emergency Management team deployments to overseas destinations including Boise (United States of America), Vancouver and Edmonton (Canada). 
Staff commuting
DELWP measures how staff travel to and from the workplace through an annual travel survey. In 2015-16, 28 per cent of DELWP staff completed the survey (859 respondents). Sixty-six per cent of respondents were from the central business district (CBD), 9 per cent from the metro area and 25 per cent from regional areas. Eighty-nine per cent of staff who responded from the CBD travelled by sustainable modes of transport including public transport, cycling, walking and carpooling, while 22 per cent from regional areas travelled by sustainable modes, up from 20 per cent in 2014-15.
Indicator	2015-16	2014-15						
	CBD	Metro	Regional	CBD	Metro	Regional		
T6	Percentage of employees regularly (>75 per cent of work attendance days) using public transport, cycling, walking, or carpooling to and from work or working from home, by locality type	89	18	22	89	30	22	

Note:
T6 covers 859 FTE
Conversion factors are taken from the National Greenhouse Accounts Factors July 2015.
Targets
The following target has been set for 2016-17:
Progressively reduce greenhouse gas emissions associated with the department’s vehicle fleet.

Greenhouse gas emissions
The emissions disclosed in the section below are taken from the previous sections and brought together here to show the department’s greenhouse footprint.
Indicator	2015-16	2014-15		
G1	Total greenhouse gas emissions associated with energy use (t CO2-e)	11,719	11,352 *	
G2	Total greenhouse gas emissions associated with vehicle fleet (t CO2-e)	6,332	5,641	
G3	Total greenhouse gas emissions associated with air travel (t CO2-e)	1,134	814	
G4	Total greenhouse gas emissions associated with waste production  (t CO2-e)	67	73	

Note:
Conversion factors are taken from the National Greenhouse Accounts Factors 2015.
Targets
The following target has been set for 2016-17:
Progressively reduce the department’s carbon footprint.
* Corrects a calculation error published in the Annual Report

Procurement
The Procurement Governance Group provides internal procurement advice to support and strengthen environmental procurement practices. Departmental templates for tendering and contracting incorporate requirements for tenderers to demonstrate their environmental credentials, and allow tender evaluation teams to weight and score this as a separate assessment criterion, where relevant. Staff seeking approval from the Chief Procurement Officer for procurement greater than $150,000 are requested to advise how sustainability was considered  in the evaluation process and to provide reasons if this was not the case.
Actions undertaken		
Emergency Services Sector	Electrolyte replacement drink ‘Paramount Safety’ is an Australian made product used in the Emergency Services Sector that comes in recyclable plastic bottles. 	
	Bottled spring water ‘Cottonwood Springs’ is sourced locally in Victoria and also comes in recyclable plastic bottles. Sourcing locally reduces transport miles and greenhouse gas emissions.	

Departmental objectives,  indicators and outputs 
This section provides an overview of key activities associated with DELWP’s medium-term objectives. It also reports on the delivery of the department’s outputs, including performance results against the output measures consistent with what was published in the 2015-16 Budget Paper Number 3: Service Delivery (BP3).
Note: output costs reported under Departmental objectives, indicators and outputs vary to the output costs reported in Note 2 of the DELWP 2015-16 Financial Statements due to the different methodologies used to allocate department wide costs.  
The table below provides a summary of DELWP’s objectives, indicators and outputs  as set out in BP3.
Departmental objectives	Indicators	Outputs	
Healthy, resilient and biodiverse environment	Participation in community based environmental programs
Level of support from key stakeholders for environmental and adaptation policy development and implementation
Reduction in pollutants from priority hotspots	Environmental programs
Environmental policy 
Statutory activities and environmental protection	
Productive and effective land management
	Efficient provision of timely and authoritative land administration and property information services
Number of visits to the public land estate managed by the department’s portfolio agencies: Parks Victoria
Bay and park assets rated in average to excellent condition	Land Victoria
Management of forests, parks and public land
	
Safe and sustainable water resources	Proportion of new homes and businesses connected to an alternative water source
Proportion of properties completely connected to the modernised irrigation delivery system (in the Goulburn-Murray and Macalister Irrigation Districts)
Number of river reaches/wetlands with maintained or improved environmental condition	Effective water management and supply	
A quality built environment	Efficient provision of timely and authoritative information on population growth and change
Public participation in planning, building and heritage initiatives
Efficient administration of Victoria’s planning, building and heritage systems 	Planning, building and heritage	
Sustainable and effective local governments	Satisfaction with the performance of councils as measured through the Local Government Community Satisfaction Survey	Local government	
Reduced impact of major bushfires and other emergencies on people, property and the environment	Percentage of bushfires contained at first attack and/or under five hectares to suppress bushfires promptly, keep bushfires small and minimise loss 
Area of public land treated through planned burning and other treatments 
Adoption of consistent systems across the department to support efficient and effective emergency management
Percentage of agreed departmental emergency management obligations met on time and to standard 	Fire and emergency management 	

Healthy, resilient and biodiverse environment 
This objective aims to deliver effective environment and climate change policy, programs, investment and regulation. It provides support for local communities and landholders engaged in environmental works, improves the transparency and delivery of environmental regulation, provides effective governance and investment in environmental programs and provides effective policy for environmental outcomes and resource efficiency. 
The department leads the development and implementation of strategic regulation and investment in environmental and natural resource programs, working with partners and local communities to deliver outcomes across Victoria. 
Progress towards achieving this objective
Context and performance trends
Biodiversity in Victoria is continuing to decline. More than 2,000 species of plants are now considered to be at risk in Victoria and more than one quarter of Victoria’s mammals, birds, reptiles and amphibians are threatened to some degree. This is inconsistent with community values about the protection of biodiversity and undermines the long term prosperity of Victoria, through increased risk to ecosystem services and natural resources for economic and social benefit.
The 2015-16 Budget provided $6 million for the Threatened Species Protection initiative. To date, more than 400 groups (including about 40,000 volunteers), including many Landcare and Coastcare groups, have been funded to deliver 156 local priority projects across Victoria.
Introduced (pest) plants and animals are a key threat to Victoria’s terrestrial, coastal, marine and freshwater environments. These pests affect the diversity and function of ecosystems, reduce land productivity and water quality, reduce amenity values and tourism opportunities, and increase fire risk. Over-abundant native wildlife can also pose a threat to a resilient and biodiverse local environment.
In March 2016, the department released two major documents for consultation to inform the future of Victoria’s biodiversity management; Protecting Victoria’s Environment – Biodiversity 2036, a 20-year strategy for halting the decline of Victoria’s native biodiversity. DELWP also released the Native Vegetation Clearing Regulations consultation paper as part of a review of the native vegetation clearing regulations.
Climate change is already causing adverse impacts on our people, environment and industry. Victoria will experience more frequent and intense extreme weather related events including bushfires, heatwaves and coastal inundation. Global action to reduce greenhouse gas emissions is driving major changes in the global economy, including a shift away from fossil fuels towards new low emission technologies and industries. 
In February 2016, the Independent Review of the Climate Change Act 2010 was tabled in the Victorian Parliament. The review looked at the effectiveness of the Act in achieving its objectives, identified options and made recommendations to strengthen the Act. The government’s response to the review, released on 9 June 2016, supports or supports-in-principle nearly all of the review’s 33 recommendations. The Victorian Government will seek to amend the Climate Change Act 2010 to provide Victoria with a world-leading legislative foundation for its climate change agenda.
In June 2016, the Premier and the Minister for Energy, Environment and Climate Change announced a long-term state climate change goal of zero net greenhouse gas emissions by 2050, and launched TAKE2 - Victoria’s Climate Change Pledge which will allow state government, businesses, local councils, community groups, educational organisations and individuals to support Victoria’s transition to a zero emission economy. All government departments are now required to contribute to a whole of government pledge to reduce emissions of greenhouse gases.
DELWP is working with land managers and the community to deliver weed and pest control programs. These include: the Roadside Weeds and Pests program that supports rural councils; the Weeds and Pests on Public Land program that protects Victoria’s key biodiversity assets; the Peri-urban Weed Management Partnership program that funds collaborative projects in Melbourne’s urban fringe; and the Good Neighbour Program that protects the values of private land at the interface with public land. In addition, the new Sustainable Water Management – Riparian Land program will protect key waterways and catchments from invasive pests and weeds.
Objective indicators 
Participation in community based environmental programs
Volunteers working in community-based environmental programs have contributed about 31,500 full days to Landcare related community activities over 2015-16. This estimate is based on the reported 2014-15 actual total of 32,563 days, reported by 66 of Victoria’s 68 Landcare groups. The actual number of FTE days for 2015–16 will be provided in the 2016–17 DELWP Annual Report. 
The assistance provided by facilitators to support the volunteer activity of Landcare groups is resulting in a general trend of greater participation, with 2013-14 being a particularly high year in terms of recorded participation.
Level of support from key stakeholders for environmental and adaptation policy development and implementation
The objective indicator for level of support from key stakeholders for environmental and adaptation policy development and implementation achieved 100 per cent in  2015-16. It is projected to remain at or above  90 per cent in the next few years. 

Reduction in pollutants from priority hotspots
We have reduced pollutants from priority hotspots by 41 per cent compared to last financial year.
Focusing on the industrial area of Brooklyn, in Melbourne’s north-west, the EPA has continued working with local government, industry and the community and actively regulating industrial sources of dust. In 2015-16, sealing Jones and Bunting roads contributed to reducing the number of days where PM10 levels exceeded the goal in the Brooklyn Industrial Estate to 10 days, compared with 17 days in 2014-15 (PM10 particles are smaller than 10 microns in diameter; PM10 is a size measure rather than a volume).  This is the lowest number of days over the limit since targeted monitoring began in 2009. The result is particularly positive given the low amount of rainfall, which reduces dust, for the year. 
In May 2016, the then Minister for Environment, Climate Change and Water released the final report of an independent inquiry into the EPA. The inquiry focused on the need for a strong and independent environmental regulator able to protect the community from current and emerging environmental and health risks. The final report made 48 recommendations to clarify and strengthen the EPA’s role. DELWP is leading preparation of the Government’s response to the report, due in late 2016.
Output performance measures
Environmental policy 
This output leads the development and implementation of strategic, whole of government environmental and adaptation policy. It provides responsive policy advice and direction to government priorities on waste, resource recovery and efficiency, ecosystem sustainability, as well as climate change adaptation and mitigation.
Through this output, DELWP also leads the modernisation of legislative, regulatory and governance arrangements in the environment portfolio and uses economic, research and scientific expertise to develop policy responses to harness Victoria’s current and emerging sustainability opportunities.
Output performance measures	Unit of measure	2015-16 actual	2015-16 target 	Performance variation (%)	Result 1	
Quantity						
Number of Victorian  Adaptation Sustainability Partnership grant project evaluations and acquittals completed	number	7	9	-22.2	ν	
Final report/evaluation and acquittals have been completed for seven projects. The remaining two will be completed by the end of September 2016. This is due to some councils having to make variations on their project milestones.						
Percentage of Victorian schools accredited in the ResourceSmart Schools program	per cent	54	46	17.4	⎫	
Out of 2,226 schools in Victoria, 1,215 schools have participated in the ResourceSmart Schools program.						
Quality						
Completion of annual reporting and board appointment processes in accordance with legislation	per cent	95	100	-5.0	O	
Departmental stakeholder satisfaction with completed policy projects	per cent	100	100	0	⎫	
Departmental stakeholder satisfaction with technical economic analysis, advice and support	per cent	100	100	0	⎫	
Cost						
Total output cost	$ million	44.4	48.0	-7.5	ν	
The lower than budgeted output cost is primarily the result of further planning and works being required for the Remediation of Surplus Government Land initiative.						

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.

Environmental programs
This output delivers investment, regulatory and research functions that support diverse and resilient natural ecosystems for a liveable Victoria.
Through this output, DELWP leads the development and implementation of strategic regulation and investment in environmental and natural resource programs, working with partners and local communities to deliver outcomes across Victoria. DELWP also undertakes research and leads development of information systems and evidence-based decision-making tools that support the systematic identification and public reporting of environmental benefits.
Output performance measures	Unit of  measure	2015–16  actual	2015–16  target	Performance variation (%)	Result 1	
Quantity						
Area of revegetation protected or enhanced through DELWP supported Landcare activities	hectares	1,602	1,500	6.8	⎫	
The 2015-16 result is in line with the expected level of revegetation funded via Landcare.						
Landcare members and community  volunteers participating in Landcare activities	number	81,000	81,000	0 *	⎫	
Quality						
Presentations made and scientific publications in peer reviewed journals	number	63	60	5.0	⎫	
Timeliness						
Native Vegetation Credit Extracts processed within 10 days	per cent	100	90	11.1	⎫	
All credits have been processed within 10 days.						
Planning referrals relating to native vegetation processed within statutory timeframes	per cent	77	80	-3.8	O	
Wildlife Licence renewals  processed by target dates	per cent	96	96	0	⎫	
Cost						
Total output cost	$ million	82.1  	81.5	0.7	⎫	

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.
* 		Corrects a calculation error published in the Annual Report
Statutory activities and environment protection
This output effectively regulates pollution through statutory and non statutory tools and settings, conducts enforcement activities and undertakes environmental condition monitoring and research. These activities protect and improve the environment to support a liveable and prosperous state by delivering clean air, healthy waterways, safe land, less waste and minimal disturbances from noise and odour for Victorians. 
This output focuses on reducing local pollution problems, working with stakeholders to improve environmental outcomes and using knowledge and science to underpin decision making to shape Victoria’s environmental future. Through collaboration, communication and information programs, this output enables greater community involvement in, and ownership of, environmental issues.
Output performance measures	Unit of  measure	2015–16  actual	2015–16  target	Performance variation (%)	Result 1	
Quantity						
Environmental condition research reports issued, improvement tools, guidelines, policies, systems and plans completed and issued	number	45	54	-16.7	ν	
A number of publications were rescheduled to enable further consultation and advice and they are planned for release in 2016-17.						
EPA notices issued for illegal  dumping of waste	number	98	70	40.0	⎫	
EPA’s continuing focus on illegal dumping resulted in more notices issued than targeted. After continued positive results in this area, the target for this measure will be reviewed during the development of 2017-18 targets.						
Quality						
EPA prosecutions are successful, and conditions in enforceable undertakings are focused on improving environmental performance 	per cent	100	90	11.1	⎫	
EPA was successful in all prosecution outcomes in 2015-16.						
Land audits submitted by EPA appointed auditors are reviewed to ensure compliance with statutory requirements and guidelines	per cent	99	90	10.0	⎫	
The 2015-16 result reflects EPA’s streamlined administrative quality assurance processes to enable Environmental Audits received to be checked for compliance with guidelines.						
Notices complied with by due date or escalation in line with Compliance and Enforcement policy	per cent	88	90	-2.2	O	
Timeliness						
Pollution reporters requesting follow-up by EPA receive contact within three working days	per cent	83	80	3.8	⎫	
Works approvals and licences completed within required statutory timelines	per cent	99	96	3.1	⎫	
Cost						
Total output cost	$ million	151.8 	154.1	-1.5	O	

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.

Productive and effective land management 
 
This objective delivers effective management and governance of Victoria’s public land to protect its social, economic and environmental values and maximise its use by all Victorians. 
DELWP works with statutory agencies, committees and local government to ensure that land is productive and is used in a sustainable manner; infrastructure on public land and in coastal environments is appropriate and well managed; the condition of marine, coastal and estuarine environments is protected, maintained and improved and that key biodiversity assets, priority habitats and ecological processes are healthy and secure. 
DELWP also provides quality land information services, including comprehensive and accessible spatial information, to support integrated planning and decision making and ensure confidence in the integrity and efficiency of the property system.
Progress towards achieving this objective
Context and performance trends
Victoria’s public land - including its parks, forests, coasts and Crown land reserves - has significant economic, environmental, cultural and recreational value. DELWP manages 3.1 million hectares of state forest, 4.1 million hectares of parks and reserves, 29,000 parcels of Crown land and 45,000 kilometres of roads and bridges. 
In March 2016, the Crown Land Legislation Amendment (Canadian Regional Park and Other Matters) Bill 2015 passed through Parliament. The new 640 hectare Canadian Regional Park near Ballarat will support a variety of community recreational activities, while protecting a north-south wildlife corridor. DELWP is engaging with Traditional Owners to find an Aboriginal name for the new park.
In April 2016, Victorian construction company, Browns Wangaratta, was awarded the contract for restoration work on the Mount Buffalo Chalet. Work is due for completion by 30 June 2017, which will be guided by the Mount Buffalo Destination Advisory Group. 
In May 2016, the Minister for Energy, Environment and Climate Change announced a $9.8 million investment in Victoria’s iconic Shipwreck Coast to deliver Stage One of the Shipwreck Coast Master Plan. This will encourage longer visitor stays and increase spending in local communities along the Great Ocean Road by providing a greater range of tourism facilities.

Objective indicators 
Efficient provision of timely and authoritative land administration and property information services
DELWP supports economic development by providing land administration and information services to property buyers and sellers, developers, councils, conveyancers, surveyors and financial institutions. We provide a wide range of property information to the public including title, survey and property sales data on a cost-recovery basis. We also protect property rights by maintaining the land and water registers to ensure that ownership changes and subdivisions are accurately recorded and registered. DELWP’s land title systems, which minimise transaction costs, are a key aspect of Victoria’s attractiveness for new private investment in commercial and residential developments.
Performance against a range of key land administration and property information service deliverables continued at a high standard resulting in DELWP maintaining the efficient provision of timely and authoritative land administration and property information services at 100 per cent in 2015-16. In total, more than 855,000 property transactions were lodged during 2015-16, an increase of 7 per cent compared to the previous year.
Number of visits to the public land estate managed by the department’s portfolio agency: Parks Victoria 
Parks Victoria recorded around 98.5 million visitors in the most recent Visitor Number Monitor survey conducted in 2014-15, against a target of 93-97 million.  The next visitor survey is scheduled for 2016-17.
The number of visits to the public land estate managed by Parks Victoria is anticipated to remain within the target range over the next  few years. 
On 18 December 2015, the Victorian Government reduced fees for camping at 55 mid-level campsites around Victoria to ensure all Victorians can continue to have access to these parks. This included campgrounds, such as Borough Huts and Jimmy Creek in the Grampians National Park, and popular sites in the Great Otway National Park including Johanna Beach, Blanket Bay and Aire River West, and Bear Gully at Cape Liptrap Coastal Park.
Bay and park assets rated in average to excellent condition
Performance against the objective indicators for bay and park assets rated in average to excellent condition, improved over 2013-14 to 2015-16, with bay assets improving from 78 to  80 per cent and park assets improving from  84.9 to 87 per cent. This is a combined result of 85.1 in 2015-16.
On 22 October 2015, the Victorian Parliament passed the National Parks Amendment (No 99 Year Leases) Act 2015. This removes the ability to grant 99-year leases and protects Victoria’s national parks from new large-scale private development. It follows the release of the Valuing Victoria’s Parks report which found parks generated $1.4 billion a year in visitor spending, supported 14,000 jobs and, through their role as water catchments, provided filtration services worth $83 million a year.
 
Output performance measures
Management of forests, parks and public land
This output provides for the improved stewardship of Victoria’s public land estate including forests, parks, coasts and Crown land reserves. Through this output, DELWP manages the development and protection of natural, cultural and community assets for the enjoyment and sustainable use by all Victorians.
DELWP works to ensure natural, built and historic assets are managed responsibly, and incorporates management of public land in partnership with statutory agencies, committees and local government.
Output performance measures	Unit of  measure	2015–16  actual	2015–16  target	Performance variation (%)	Result 1	
Quantity						
Crown land leases directly managed by the Department 	number	696	684	1.8	⎫	
Crown land licenses directly managed by the Department 	Number (000)	44	43	2.3	⎫	
Maps generated on Land Channel	Number (million)	17.5	14	25.0	⎫	
The 2015-16 result is higher than the 2015-16 target due to increased demand for maps.						
Number of activities undertaken by Coastcare Victoria participants 	number	669	600	11.5	⎫	
Increased performance against this measure reflects the success of the Summer by the Sea 2016 program.						
Number of hectares treated to minimise the impact of pest plants, pest animals and overabundant native animals in parks managed by Parks Victoria	hectares (000)	1,100 (estimate)	1,100	0	⎫	
Number of visitors to the Royal Botanic Gardens in Melbourne and Cranbourne	number (million)	1.8	1.6-2.0	0	⎫	
Number of visits to Parks Victoria managed estate	number (million)	98.5	93-97	1.5	⎫	
Reports generated on Land Channel	number (million)	3.3	3.9	-15.4	ν	
The 2015-16 result is lower than the 2015-16 target due to a lower than expected demand for reports. A significant proportion of this lower than anticipated demand is attributed to the implementation of the Surveying and Planning through Electronic Applications and Referrals (SPEAR) portal which has reduced the number of reports that agencies and the public are requesting on Land Channel. Note for accurate historical comparison, the unit of measure has been corrected from ‘number’ to ‘number (million)’ as per the 2016-17 budget papers.						
Threatened native species and communities for which specifically targeted conservation measures are in place at Royal Botanic Gardens	number	6	6	0	⎫	
Total area of estate managed by Parks Victoria	hectares (000)	4,104	4,106	0	⎫	
Visitors to Zoos Victoria at Melbourne, Werribee and Healesville	number (million)	2.45	1.95	25.6	⎫	
The 2015-16 result is higher than the 2015-16 target due to an increase in Zoos Victoria memberships and repeat visits.						
Quality						
Audited Vicmap digital map base not requiring correction	per cent	97	97	0	⎫	
Foreshore protection assets around Port Phillip and Western Port bays rated as ‘good’ to ‘very good’ condition	per cent	55	55	0	⎫	
Level of compliance with environmental regulatory framework for commercial timber operations as required by the Forest Audit Program	per cent	82	90	-9.3	ν	
The 2015-16 result is lower than the 2015-16 target due to the introduction of a new risk-based approach that focuses on key compliance priorities, such as the protection of mandatory exclusion areas from the impacts of timber harvesting and the rehabilitation of waterway crossings.						
Publicly elected committees of management that have a current statutory appointment	per cent	93	90	3.3	⎫	
Recreational facilities in state forests with a life expectancy greater than five years	per cent	81	60	35.0	⎫	
The 2015-16 result is higher than the 2015-16 target due to maintenance works completed at key sites across the state. The 2016-17 target has been increased to reflect the works.						
Significant built bay assets managed by Parks Victoria rated in average to excellent condition	per cent	82	70	17.1	⎫	
The 2015-16 result is higher than the 2015-16 target due to improvement and maintenance works completed at key sites across the state. The 2016-17 target has been increased to reflect these works.						
Significant built park assets managed by Parks Victoria rated in average to excellent condition	per cent	88	83	6.5	⎫	
The 2015-16 result is higher than the 2015-16 target due to the addition of new assets across the state. The 2016-17 target has been increased to reflect these new assets.						
Timeliness						
Rent reviews of Department managed Crown land leases undertaken within specified time frames	per cent	94	95	-1.1	O	
Update transactions for the Vicmap digital map base processed within the required timeframes	per cent	99	98	0.9	⎫	
Cost						
Total output cost	$ million	321.7	304.2	5.8	ν	
The higher 2015-16 output cost is attributable to additional funding provided for the Werribee Mansion, Small Alpine Resorts - Mt Baw Baw and Lake Mountain, and Junction Oval Redevelopment not included in the published budget.						

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.

Land Victoria
This output delivers high quality and authoritative land administration and property information services, including the registration of land titles under the Torrens system, survey, valuation, property sales and planning and property certificates.
Output performance measures	Unit of  measure	2015–16  actual	2015–16  target	Performance variation (%)	Result 1	
Quantity						
Planning certificates issued	number (000)	57	55	3.6	⎫	
Property transfers, discharge of mortgages and registration of new mortgages	number (000)	855	750	14.0	⎫	
The 2015-16 result is higher than the 2015-16 target due to increased activity in the property market.						
Proportion of title searches supplied (remotely) online	per cent	99	98	1.0	⎫	
Title searches supplied	number (000)	2,232	2,220	0.5	⎫	
Quality						
Government owned properties sold, bought or leased within 10 per cent of valuation	per cent	80	80	0	⎫	
Timeliness						
Land dealings registered within five days	per cent	99	95	4.2	⎫	
New titles (subdivisions) created within three weeks	per cent	78	95	-17.9	ν	
The 2015-16 result is lower than the 2015-16 target due to higher than anticipated levels of demand for service and more complex plans being lodged.						
Cost						
Total output cost	$ million	95.6	65.8	45.3	ν	
The higher than budgeted 2015-16 output cost predominately relates to greater than expected Electronic Conveyancing and Landata services resulting from an improved property market.						

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.

Safe and sustainable water resources
This objective aims to increase the efficiency of supply and use of water in cities and towns and improves environmental conditions of waterways to ensure Victoria has safe and sustainable water resources to meet future urban, rural and environmental needs. 
DELWP works in partnership with water corporations, catchment management authorities, government agencies, industry and the community to balance the economic, environmental and social values of water. This helps to deliver secure water supplies, greener and liveable cities and towns, and healthy waterways and aquifers. 
Progress towards achieving this objective
Context and performance trends
Water is a public resource and is essential for the environment, community health and economic sustainability. Climate change, a growing population and a growing economy will continue to put pressure on water system services and our natural environments. Climate change means that the medium to long term outlook for Victoria is for a drier future with more variable weather patterns. The reduced rainfall means drier soils and catchments, and reduced streamflows in waterways. Typically for every 10 per cent reduction in rainfall, streamflows reduce by 20 to 30 per cent. 
In addition to the impacts of climate change, a growing population and economy will increase demand for water services from industrial, residential and agricultural users. The community expects high quality water services, including greener urban centres, improved public amenity, and healthier waterways and ecological systems, with minimum cost-of-living impacts. The combined impacts of climate change and rapid population growth projected for Melbourne and regional urban centres will put greater pressure on water system services, including increasing demand for drinking water and integrated management of water supply, stormwater and wastewater. 
Resilient and liveable cities and towns  are fundamental to our state’s economic prosperity, social and environmental needs,  and community identity and wellbeing. 

Objective indicators 
Proportion of new homes and businesses connected to an alternative water source
In 2015-16, the proportion of new homes connected to an alternative water source was maintained at 31 per cent (as in 2014-15). This is a favourable result because of the increasing ratio of infill area development, where new homes cannot be connected to third-pipe schemes.
In March 2016, the then Minister for Environment, Climate Change and Water announced the Target 155 water efficiency campaign would be reactivated in 2016-17. During the millennium drought (2006-2010) Melburnians reduced their water use per capita by more than 20 per cent. 

Proportion of properties completely connected to the modernised irrigation delivery system (in the Goulburn-Murray and Macalister Irrigation Districts) 
DELWP continues to support a sustainable and productive irrigation sector through large-scale irrigation modernisation projects, including the Goulburn-Murray Water (GMW) Connections project and the Macalister Irrigation District modernisation. 
The proportion of properties completely connected to the modernised irrigation delivery system (in the Goulburn-Murray and Macalister Irrigation Districts) has increased from 38 to  69 per cent over 2013-14 to 2015-16. This is despite delays to the completion of Stage Two of the GMW Connections project in 2015-16, which will now be implemented from 2016-17.
In June 2016, the Minister for Water released details of the reset of GMW Connections, including a new project roadmap outlining key strategies for moving the project forward. DELWP and its portfolio partners will work with local stakeholders and irrigators to find the best solutions for increased productivity, delivery of modern and efficient irrigation systems and secure water savings as part of Victoria’s work to deliver the Murray-Darling Basin Plan.

Number of river reaches/wetlands with maintained or improved environmental condition
DELWP also works to improve the environmental condition of waterways through renewed state and regional strategies for waterway management, efficient management of environmental water and statewide investment in on-ground works. In 2015-16, the number of river reaches/wetlands with maintained or improved environmental condition increased from around 343 to 394 from 2013-14 to 2015-16 period, with an increase of nearly 14 per cent in 2015-16.
A Floodplain Management Strategy, which clarifies the roles and responsibilities for floodplain management in relation to land use planning decisions and improving flood warning systems, was released in April 2016. The strategy received $25 million in the 2016-17 Budget, which included $11 million for local flood mitigation measures in 15 rural communities. 
The then Minister for Environment, Climate Change and Water launched Victoria’s catchments strategy, Our Catchments, Our Communities in May 2016. The strategy will better integrate catchment management activities through a regionally focused and community-based approach. From 2016-17, DELWP will invest $222 million to improve the health of our waterways and catchments in partnership with catchment management authorities, catchment management partners and the broader community.

Output performance measures
Effective water management and supply
This output develops policies, provides strategic advice and oversees regulatory systems and institutional arrangements to effectively manage Victoria’s water resources. Through this output, DELWP delivers on-ground environmental programs to improve the health of waterways; water industry reform, governance and performance oversight; sustainable irrigation programs and makes water resource information accessible to enable informed decision-making.
Output performance measures	Unit of  measure	2015–16  actual	2015–16  target	Performance variation (%)	Result 1	
Quantity						
Area of waterway vegetation works undertaken to improve the health and resilience of waterways	hectares	8,010	3,000	167.0	⎫	
The 2015-16 expected result is higher than the 2015-16 target due to once-off funding provided in the 2015-16 Budget for riparian and wetland works. The 2016-17 target has been increased following the allocation of funding for improving the health of waterways in regional Victoria.						
Corporate plans submitted by Catchment Management Authorities are aligned with ministerial guidelines and template, and meet the requirement of relevant Acts	per cent	100	100	0	⎫	
Cumulative water savings (permanent reduction in irrigation distribution system delivery losses) realised through water recovery projects	megalitres	681,056 (estimate)	749,600	-9.1	ν	
The 2015-16 expected actual result is lower than the 2015-16 target due to delays in implementing the works program for the GMW Connections project. Water recovery targets will also be revised as part of the reset of the GMW Connections project.
Note: This is an estimated result only. Final data for this performance measure will be available following completion of an annual audit process in late 2016. 						
Number of people engaged to increase the knowledge/capacity of water management	number	8,601	4,500	91.1	⎫	
The 2015-16 result is higher than the 2015-16 target due to increased levels of community engagement and participation associated with once-off funding provided in the 2015-16 Budget for additional riparian and wetland works.						
Number of sites where works have been undertaken to improve instream health	number	173	50	246.0	⎫	
The 2015-16 result is higher than the 2015-16 target due to the provision of once-off funding in 2015-16 for additional riparian and wetland works which has enabled more works to be delivered at more sites. The 2016-17 target has been increased following the allocation of funding for the Improving the health of waterways in regional Victoria initiative.						
Number of sites with environmental water managed to meet  environmental objectives	number	179	134	33.6	⎫	
The 2015-16 result is higher than the 2015-16 target due to favourable seasonable conditions, water availability and environmental requirements. 						
Other Victorian retail water entitlements (including licences to take and use water and other miscellaneous entitlements) recorded in the water register as the authoritative record	per cent	95	90	5.6	⎫	
Rebates approved for small business for improved water efficiency	number	654	350	86.9	⎫	
The 2015-16 result is higher than the 2015-16 target due to an increase in claims received before the program ended in September 2015. The 2015-16 result represents the final number of rebates to be approved under the program.						
Rebates approved to households for improved water efficiency in the house and garden	number	4,063	3,500	16.1	⎫	
The 2015-16 result is higher than the 2015-16 target due to an increase in claims received before the program ended in September 2015. The 2015-16 result represents the final number of rebates to be approved under the program.						
Water information products (including annual water accounts, water resource condition reports and water monitoring materials) delivered for greater accountability in sustainable water resource management	number	5	5	0	⎫	
Quality						
Manage Victoria’s salinity impacts in the Murray Darling Basin so that Victoria is compliant with the Murray Darling Basin Agreement	per cent	100	100	0	⎫	
Percentage of bulk and environmental entitlement records publicly available	per cent	100	100	0	⎫	
Timeliness						
Statutory obligations of Water Corporations complied with, including annual reports and audits, corporate plans, and exercises under the Terrorism (Community Protection)  Act 2003	per cent	100	100	0	⎫	
Cost						
Total output cost	$ million	384.6	603.3	-36.3	ν	
The lower output cost predominately relates to the GMW Connections Project due to delays in obtaining required signed landowner agreements before payments can be made to landowners to connect to the new delivery system. The project timeline for the GMW Connections Project is being reset. In addition, less funding was received for Commonwealth funded initiatives, including the Victorian Farm Modernisation project.						

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.

A quality built environment
This objective aims to plan for the future growth and transformation of cities and regions and provides leadership and advice on heritage protection and the built environment. It delivers streamlined, fair and transparent planning, building and heritage systems. 
DELWP recognises the link between the built and natural environment in the quality of our lives, and works to accommodate population growth while maintaining world class liveability and protecting our heritage for future generations.
Progress towards achieving this objective
Context and performance trends
An integrated approach to managing our built and natural environment is vital to accommodating population growth and change in a way that maintains our world-class liveability and protects our heritage. Victoria’s population is growing fast and projected to increase from six million in 2016 to almost  eight million in 2031, and exceeding 10 million  by 2051. Eight million people are projected to  live in greater Melbourne and 2.1 million in Victoria’s regions. 
The quality of our built and natural environments influences Melbourne and Victoria’s ability to attract jobs, investment and skills. As population growth and climate change impact our built and natural environment, it is critical that we protect and enhance our natural, cultural and heritage places.
In 2015-16, more than 57,000 planning permit applications were processed through Victoria’s planning system, totalling around $24 billion in economic investment potential.
The Victorian Government is investing  $25.5 million in Smart Planning reforms, which will streamline and improve the state’s planning system. Since the last major reforms more than 20 years ago, planning schemes and provisions have expanded to 75,000 pages and 15,000 static maps. Smart Planning will reform and modernise the system, bringing it into the 21st century. We will reduce the size and complexity of regulation and improve citizen engagement and tools, delivering significant economic and social benefits.  
Objective indicators 
Efficient provision of timely and authoritative information on population growth and change
DELWP’s annual deliverables in regard to the efficient provision of timely and authoritative information on population growth and change were delivered on time and to specification, including a report on the supply, consumption and adequacy of residential and industrial land, and the updated annual state population projections.
Public participation in planning, building and heritage initiatives 
Public participation in DELWP’s planning, building and heritage initiatives is vital to our stewardship of these systems. Through our planning panel and advisory committee processes, we give the public the opportunity to have their say on planning issues and projects that matter to them. These include conducting community consultation processes and establishing specific committees to advise on planning reviews, development applications and amendments to planning schemes. Key advisory committee processes undertaken in 2015-16 include the Brunswick Terminal Station Upgrade Advisory Committee, Macedon Ranges Protection Advisory Committee, Major Hazard Facilities Advisory Committee, and Melbourne C270: Central City Built Form Review Advisory Committee.
In 2015-16, DELWP also engaged with the public as part of delivering many significant pieces of work, such as the Review of the Heritage Act 1995. Public consultation on the Act was undertaken between June and August 2015, with submissions invited in response to the discussion paper. More than 120 submissions and survey responses were received. Copies of submissions were made available online. All submissions received have been reviewed and feedback is being carefully considered to guide the future direction of the Heritage Act. To keep the public informed, updates will be provided on the DELWP website.
DELWP ensures that community views are incorporated into the government’s long-term strategies to accommodate the challenges and opportunities presented by Victoria’s population growth. DELWP will ensure the vision and priorities of Victorians are reflected in the refresh of Plan Melbourne. This strategy will complement other work to guide future infrastructure and facilitate economic development. In October 2015, the Plan Melbourne Refresh discussion paper was released to engage the community in a conversation about our city’s future. The paper focused on how we can sustainably manage Melbourne’s growth, while maintaining world-class liveability and protecting our diverse natural environments. In particular, the paper addressed complex issues that affect the community directly, such as housing affordability and climate change. 
Efficient administration of Victoria’s planning, building and heritage systems 
DELWP oversees land use planning, building regulations and the conservation of heritage places. We work with councils, and across council boundaries, to facilitate strategic outcomes.
In December 2015, the Minister for Planning announced an independent review into the application of the new residential zones. The Minister also announced a new committee to overhaul planning rules along the Yarra River. The Yarra River Protection Ministerial Advisory Committee is consulting with surrounding residents, businesses, river users and the wider community to draft the new Yarra River (Birrarung) Protection Act.
The Minister for Planning has approved the development of several significant regional projects in 2015-16 including: a second Echuca-Moama bridge; a new wind farm for north east Victoria, a livestock exchange for Ballarat; a sky lift for Arthurs Seat and a multi-storey tower for Geelong’s CBD. The Minister has also approved several significant developments in Melbourne’s central city, including: redevelopment of the Melbourne Convention Centre, a two-tower development at 385 Queen Street, a six tower project on Kavanagh Street Southbank, the first stage of the Melbourne Quarter development on Batman’s Hill and a major development at 447 Collins Street. 
The Minister established the Fishermans Bend Taskforce to draft detailed plans for five separate neighbourhoods in the urban renewal area which will accommodate up to 80,000 new residents. The Minister also strengthened heritage protection. In 2015-16 for some of Melbourne’s landmark sites such the Shrine of Remembrance, Bourke Hill (which includes the Windsor Hotel, the Princess Theatre and Parliament House) and Williamstown.
Output performance measures
Planning, building and heritage 
This output delivers programs to address the future growth and transformation of cities and regions through strategic and integrated land use planning; urban development, design and renewal; land supply; heritage conservation and management and regulatory reform. Through this output, DELWP administers the statutory responsibilities of the Minister for Planning and provides for fair and transparent planning, building and heritage systems.
Output performance measures	Unit of  measure	2015–16  actual	2015–16  target	Performance variation (%)	Result 1	
Quantity						
Number of local governments undertaking work to support strategic planning for coastal settlements and areas 	number	9	9	0	⎫	
Places or objects assessed for the Victorian Heritage Register	number	51	45	13.3	⎫	
The 2015-16 result exceeded the 2015-16 target due to an increased number of major projects requiring assessment.						
Research published: demographic and spatial trends	number	7	5	40.0	⎫	
The 2015-16 result exceeded the 2015-16 target due to the development of two additional ad hoc reports.						
Quality						
Community Works Program/ Community Support Grant projects completed meet agreed project objectives	per cent	100	100	0	⎫	
Environmental effects statements, referrals and assessments are completed effectively and within the timeframes necessary to meet targets in the Ministerial Guidelines	per cent	80	70	14.3	⎫	
Performance is higher than anticipated due to a continuing focus on timeliness and the scale and complexity of statements, referrals and assessments submitted during 2015-16.						
Timeliness						
Average number of days to issue an archaeological consent	days	22	30	26.7	⎫	
The 2015-16 result exceeds the 2015-16 target and reflects streamlined processing.						
Average number of days to issue heritage certificates	days	7	7	0	⎫	
Community Works/ Community Support Grant payments made within 21 days of completion of agreed milestones in funding agreement	per cent	100	95	5.2	⎫	
Heritage permits issued within initial 60 day statutory timeframes	per cent	98	90	8.9	⎫	
The 2015-16 result reflects improvements to administration and monitoring processes for permit applications and dedicated permit staff for major projects.						
Median number of days taken by the department to assess a planning scheme amendment	days	36	25	-44.0	ν	
The full year result improved on the half year result (37 days) but falls short of the target. Resourcing measures are being implemented to improve the timeliness of planning scheme amendments in 2016-17.						
Report annually on analysis of supply, consumption and adequacy of residential and industrial land	date	Dec 2015	Dec 2015	0	⎫	
State population projections reviewed and updated	date	Feb 2016	Feb 2016	0	⎫	
Cost						
Total output cost	$ million	81.8 	120.0	-31.8	ν	
The lower 2015-16 actual resulted primarily from underspends of approved funding within the Growth Area Public Transport Fund and Building New Communities Fund due to the complexity of the infrastructure projects being undertaken and the need to closely consider community issues and feedback.						

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.
Sustainable and effective local governments
This objective aims to support effective and efficient local governance and service provision, and supports communities to manage change and growth at a local level. 
DELWP works with local government to support the delivery of governance services and infrastructure and build stronger communities across the state.
Progress towards achieving this objective
Context and performance trends
A strong relationship with local government is central to achieving the government’s economic, environmental and liveability outcomes. Local government has a significant impact on the lives of all Victorians. In addition to providing democratically-elected local governance and leadership, Victorian councils propose spending $7.9 billion in 2016-17, and employ more than 35,000 full time equivalent staff to deliver a wide range of services and facilities for their communities. They work in partnership with the local community, to provide a suite of state and federal government programs along with other agencies.
Melbourne’s 10 interface councils have rapidly growing populations, productive rural land and some of Victoria’s most vulnerable conservation corridors. These municipalities will accommodate 46 per cent of the state’s population growth between 2016 and 2031, an extra one million residents. These municipalities also face some of Victoria’s greatest infrastructure challenges. The government is committed to supporting these communities through improved transport connections, access to local health services, increased access to local jobs and improving the liveability and resilience of these communities.This support includes the $50 million Growing Suburbs Fund that is delivering community infrastructure for the 10 interface councils.
DELWP partners with the local government sector to support effective and efficient governance and service and infrastructure provision through the Know your Council website, the Fair Go rating system and support for the Victoria Grants Commission who in 2015-16 allocated $539.796 million in financial assistance grants to Victorian councils.
The Local Government Amendment (Fair Go Rates) Act 2015 received Royal Assent in December 2015 to implement a system for capping of council rates. From 2016-17, the  Act provides the Essential Services Commission (ESC) with responsibilities to assess applications for rate increases above the designated annual cap and monitoring of overall compliance and outcomes for communities, as well as providing recommendations on the cap to the Minister for Local Government.
After a Commission of Inquiry, Greater Geelong City Council was dismissed by the passage of the Local Government Amendment (Greater Geelong City Council) Act 2016. In April 2016, a panel of administrators was appointed to act as the council until October 2017.  
In March 2016, amendments to the Local Government Act 1989 came into effect to empower councils to more effectively deal with councillor misconduct. Allegations of code of conduct breaches will be heard by independent Councillor Conduct Panels with the power to suspend councillors. In extreme cases of misconduct, the Minister for Local Government can recommend to the Governor in Council that a councillor be stood down.
In May 2016, DELWP’s Know Your Council website came runner up in the Government  2.0 category of the 2016 Australian Government ICT Awards. As at 30 June 2016, 65,000 users have accessed information about council services, on topics ranging from animal management to food safety and financial performance.
On 23 May 2016, the Hon. Lily D’Ambrosio MP was allocated responsibility for the new portfolio of Suburban Development in addition to her other portfolio of Energy, Environment and Climate Change. This new DELWP portfolio coordinates suburban development-related activities across Melbourne’s local government areas, with a high-priority focus on the outer suburbs which are dealing with population growth. 

Objective indicator
Satisfaction with the performance of councils as measured through the Local Government Community Satisfaction Survey
The Statewide Overall Performance index score in 2016 of 59 represents a one point decline on the 2015 result; performance is two points from the state’s 2014 high score of 61. Almost all demographic and geographic groups rated overall performance within one or two points of 2015 ratings. The exception was regional centres, where residents rated their councils, on average, three index points lower than last year (58 to 55).
Perceptions of performance are largely positive to neutral. Forty-five per cent of residents rated their council’s overall performance as ‘very good’ or ‘good’ and 36 per cent as ‘average’ compared with only 16 per cent who rated their council’s performance as ‘very poor’ or ‘poor’.
On average, large rural councils (54) perform lower on overall performance than other council groups, while metropolitan councils perform higher (66 while other scores were 61 among interface councils, 57 among small rural councils and 55 among regional centres).
As with other core measures, on average residents aged 18 to 34 rated their respective councils higher for overall performance (62) than other age groups. Residents aged 50 to  64 years rated them lower (55, with an index score of 59 among residents aged 65+ years and an index score of 57 among residents aged 35 to 49 years).

Output performance measures
Local government
This output delivers activities in partnership with the local government sector to support effective and efficient governance and service provision. Through this output, DELWP administers programs to support local governments to provide public library services and respond to and recover from natural disasters and provides support to the Victoria Grants Commission.
Output performance measures	Unit of  measure	2015–16  actual	2015–16  target	Performance variation (%)	Result 1	
Quantity						
Meetings held with Ministerial Mayors Advisory Panel	number	5	4	25.0	⎫	
The final meeting of the Ministerial Mayors Advisory Panel for 2014-15 was rescheduled and held in July 2015.						
Percentage of Roadside Weeds and Pest Management grant payments made against completion of milestone deliverables under funding agreement	per cent	100	100	0	⎫	
Percentage of identified councils funded as part of the Vulnerable People in Emergencies Program who have met milestone criteria	per cent	100	100	0	⎫	
Percentage of Public Library Services grant payments made against completion of milestone deliverables	per cent	100	100	0	⎫	
Quality						
Local Government Victoria’s legislative and regulatory initiatives incorporate stakeholder feedback	per cent	100	100	0	⎫	
Local Government Victoria’s policy and program development processes incorporate stakeholder feedback 	per cent	100	100	0	⎫	
Timeliness						
Victoria Grants Commission allocations finalised to support the completion of council budgets within statutory timeframes	per cent	100	100	0	⎫	
Cost						
Total output cost	$ million	120.1 	112.1	7.1	ν	
The higher output cost primarily reflects additional projects funded in 2015-16 including grants passed onto local governments for the Community and Recreational Sports Package initiative, the clean-up of Morwell following the Hazelwood Mine Fire in 2014, infrastructure redevelopment in Colac Otway Shire following bushfires, and Weeds and Pests.						

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.

Reduced impact of major bushfires and  other emergencies on people, property and  the environment 
This objective aims to deliver a risk-based approach to preparing for and responding to fire and emergencies to reduce the impact of these events on people, property and the environment and to improve community and ecosystem resilience. 
DELWP works with its agency partners and the community to further improve preparation and response to bushfire and other emergencies and implement new systems to support an all-hazards approach to emergency management. 
Progress towards achieving this objective
Context and performance trends
Victoria experienced unseasonably hot conditions in December, hotter and wetter conditions than average in January, and drier than normal conditions in February. March was significantly hotter and drier than average. According to the Bureau of Meteorology, the 2015-16 summer was warmer in comparison to previous years, with temperatures about one-and-a-half degrees higher than average. There were 21 Total Fire Ban days – more than double the number from last season – six days of extreme fire danger and 21 days of severe fire danger. Most of these were in November and December.
On 19 December 2015, two bushfires were ignited by lightning strikes in Victoria’s Barwon Otway area. Between 19 December 2015 and 21 January 2016, the bushfire that became known as the  Wye River–Jamieson Track fire burned 2,500 ha in the Otway Ranges in the Lorne-Wye River region.  By the end of 25 December, the fire had destroyed  116 structures– 95 in Wye River and 21 in Separation Creek and damaged many others. The Wye River–Jamieson Track fire continued to burn for 34 days until it was contained on  21 January 2016.
The fires in northern and south-west Victoria in the lead-up to and during the Christmas break served as a reminder of how devastating bushfire can be and how vital our role is in helping protect all communities.  Since the fires, DELWP has played a critical role in supporting joint efforts with the community, Emergency Management Victoria and Colac Otway Shire Council to address the immediate aftermath of the fires, and to support a comprehensive resettlement plan. The partnerships across the local community, government, council, and business have led to a number of key milestones being reached, including:  
clean-up of 171 properties by Grocon 
significant tree management works completed to make conditions safe on public and private land
hosting more than 50 community events, meetings and workshops and extensive communication activity
completion of priority works to reinstate public land facilities, including Paddy’s Path
implementation of detailed research and technical studies to support rebuilding
creation of ‘one-stop-shops’ to support affected property owners to deal with a broad range of questions
streamlining planning requirements to facilitate rebuilding work	
addressing the resolution of emerging priorities including reinstatement of high risk retaining walls, and repair and improvement to the drainage system
the first approvals for rebuilding to get underway were issued within six months of the fires.
In March 2016, DELWP introduced a new organisational structure and Community Charter in response to several drivers including the government’s public sector reform agenda to improve regional service delivery, recommendations of the Inspector-General for Emergency Management (IGEM) and the independent investigation into the Lancefield-Cobaw fire. The new Forest, Fire and Regions (FFR) Group brings forest, fire and emergency management together and creates a clear line of accountability for bushfire prevention, preparedness and response. The FFR Group is adopting a place-based approach to service delivery across the state.
Bushfire risk is not evenly distributed across the state. For the purpose of measuring bushfire risk, Victoria is divided into seven bushfire risk landscapes. The amount of bushfire risk in a landscape is related to where communities and assets are located, the size of those communities, the types and arrangements of vegetation and the topography. Not all communities at highest risk from bushfires are located next to forests. Bushfire risk in Victoria exceeded 90 per cent in 2002. After the millennium drought and campaign fires between 2002 and 2009 (the 1.5 million ha Alpine fires in 2002-2003, the 1.0 million ha Great Divide fires in 2006-07 and the  500,000 ha 2009 Black Saturday fires) bushfire risk fell to below 60 per cent in 2010. With vegetation recovery increasing fuel loads, bushfire risk in Victoria has risen to 65 per cent and is projected to exceed 70 per cent by  2020 without effective intervention.
For 2016-17, DELWP has adopted all recommendations from the IGEM Review of performance targets for bushfire fuel management on public land through the development of Safer Together. This includes adopting a new departmental objective indicator in 2016-17: Area treated through planned burning and other treatments to maintain statewide bushfire risk at or below  70 per cent. This replaces DELWP’s former hectare-based fuel reduction target, however DELWP will continue to monitor the area of public land treated to reduce fuel load, including planned burns, mechanical and chemical treatments, and roadside vegetation management.
Objective indicators 
Percentage of bushfires contained at first attack and/or under five hectares to suppress bushfires promptly, keep bushfires small and minimise loss 
The objective indicator for fires controlled at first attack has improved from 74 to  84 per cent over the 2013-14 to 2015-16 periods. The objective indicator for fires controlled at less than five hectares also improved from 79.5 to 91 per cent over 2013-14 to 2015-16. These results highlight the effectiveness of DELWP’s first attack strategy to suppress fires before they become established, and minimise impacts. Performance in this area is subject to seasonal conditions and can fluctuate.
Area of public land treated through planned burning and other treatments 
An early start to the 2015-16 fire season limited the amount of planned burning able to be conducted in spring. Prolonged dry, summer conditions delayed the start of autumn planned burning until 1 April 2016 and rain at the end of April prevented further substantial burning. DELWP personnel made the most of favourable conditions throughout April 2016 and were able to treat more than 120,000 hectares with fuel reduction activities. 
As part of this, DELWP delivered a number of key planned burns that will play a vital role in reducing risks to the Victorian community, including Arthur’s Seat (28ha), Mt Dandenong (8.01ha) and Big River (1642ha). These planned burns had been scheduled for many years, but had been unable to proceed as a result of weather and fuel conditions and potential adverse community impacts. Late May 2016 saw more favourable conditions in western Victoria, although shortened burn days limited burning to smaller burns.
As at 30 June 2016, DELWP and its partners had treated 197,940 hectares with fuel reduction activities. This represents 72 per cent of the annual fuel management target. The area treated included 184,693 ha of planned burning and 13,247 ha of mechanical works. 

Adoption of consistent systems across the Department to support efficient and effective emergency management
DELWP maintained the adoption of consistent systems across the department to support efficient and effective emergency management at 100 per cent in 2015-16. Consistency across applications is a key consideration for the adoption or development of fire and emergency management systems. Where possible, systems across the department and the sector share information.
Percentage of agreed departmental emergency management obligations met on time and to standard 
DELWP maintained the percentage of agreed departmental emergency management obligations met on time and to standard at 100 per cent in 2015-16. DELWP committed to making significant changes to how it operates across the state to improve its planned burning program in response to the independent investigation into the Lancefield-Cobaw fire. 
Output performance measures
Fire and emergency management
This output covers activities under an integrated management framework for the effective planning and management of fire and other emergencies to reduce the impact on people, property and the environment. 
Through this output, DELWP delivers a planned burning program to reduce bushfire risk to people, property and the environment; engages with the community; ensures its workforce is effectively trained and prepared; and maintains a road network capable of facilitating fire and emergency related activities, and providing access to tourists, the general public and the timber industry.
Output performance measures	Unit of  measure	2015–16  actual	2015–16  target	Performance variation (%)	Result 1	
Quantity						
Bushfire fuel management completed to protect key assets 	hectares (000)	198	275	-28.0	ν	
An early start to the fire season limited the level of spring burning, and very dry summer conditions extended well into March, resulting in conditions in many parts of the state being too dry to commence burning until well into autumn. Good conditions prevailed for most of April, with almost 120,000 hectares of fuel management activity undertaken, the majority in the east of the state. At the end of April, Victoria experienced a number of significant rain events.  While late autumn saw more favourable conditions in western Victoria, shortened burn days limited burning to smaller burns.  The 197,940 hectares treated includes 13,247 hectares of mechanical works. Note this measure has been replaced in 2016-17 to focus  on reducing risk rather than hectares burned.						
Community engagement plans developed and implemented in accordance with the statewide strategy for bushfire management engagement 	number	6	6	0	⎫	
Length of strategic fire access roads and fuel breaks treated to manage safety risks posed by dangerous trees	km	415	400	3.8	⎫	
Personnel with accreditation in a fire and emergency management role	number	1,979	1,800	9.9	⎫	
The 2015-16 result is higher than 2015-16 target due to an increased focus on fire resources as a result of  Safer Together.						
State forests roads (Category 1) and bridges (on Category 1 roads) with documented inspections and/or maintenance programs to meet regulatory obligations	per cent	100	100	0	⎫	
Strategic engagement forums held to enhance stakeholder and community understanding of bushfire management	number	13	12	8.3	⎫	
Strategic forums have been held in several locations as part of ongoing community engagement processes, most notably in the Grampians, far east Gippsland and in Melbourne with a statewide peak body group.						
Quality						
Agreed departmental emergency management obligations met on time and to standard	per cent	100	100	0	⎫	
Fires contained at less than 5 hectares to suppress fires before they become established, minimising impact	per cent	91	80	13.8	⎫	
Of the total 1,148 fires, 1,046 were contained at less than 5 hectares with 102 fires 5 hectares and over in size.  In 55 of these fires DELWP was supporting CFA as the control agency; in one fire DELWP was supporting the MFB; one fire was in South Australia; and one fire was in New South Wales. Of the 44 DELWP controlled fires, 54 per cent were caused by lightning.						
Personnel accredited to serve in a senior capacity (level 2 or 3) in a fire and emergency management role	number	286	300	-4.7	O	
Timeliness						
Assessment of model of cover completed prior to fire season to assess resources available and requirement for the upcoming fire season	date	Dec 2015	Dec 2015	0	⎫	
District fire operations plans completed	date	Sept 2015	Oct 2015	0	⎫	
Fires contained at first attack to suppress fires before they become established, minimising impact	per cent	84	80	5.0	⎫	
Readiness and response plans completed prior to fire season	date	Nov 2015	Dec 2015	0	⎫	
Cost						
Total output cost	$ million	393.0	335.1	17.3	ν	
The higher 2015-16 output cost is primarily due to budget supplementation to meet the cost of responding to major bushfire incidents in the 2015-16 season.						

Note:
1	⎫	Performance target achieved or exceeded.
	O	Performance target not achieved – within 5 per cent variance.
	ν	Performance target not achieved – exceeds 5 per cent variance.

Legislative and other information 
Major entities  
Environment, Climate Change and Water
Alpine Advisory Committee
Alpine Resorts Coordinating Council
Barwon Region Water Corporation
Barwon South West Waste and Resource Recovery Group 
Border Groundwater Agreement Review Committee
Budj Bim Council 
Central Coast Regional Coastal Board
Central Gippsland Region Water Corporation
Central Highlands Region Water Corporation
City West Water Corporation
Coliban Region Water Corporation
Commissioner for Environmental Sustainability
Committees of management (various) 1
Corangamite Catchment Management Authority
Director of National Parks
Dhelkunya Dja Land Management Board 
East Gippsland Catchment Management Authority
East Gippsland Region Water Corporation
Environment Protection Authority
Environment Protection Board
Falls Creek Alpine Resort Management Board
Gippsland and Southern Rural Water Corporation
Gippsland Lakes and Coast Regional Coastal Board
Gippsland Waste and Resource Recovery Group 
Glenelg Hopkins Catchment Management Authority
Goulburn Broken Catchment Management Authority
Goulburn Valley Region Water Corporation
Goulburn Valley Waste and Resource Recovery Group
Goulburn-Murray Rural Water Corporation
Grampians Central West Waste and Resource Recovery Group 
Grampians Wimmera Mallee Water Corporation
Gunaikurnai Traditional Owner Land Management Board
Lake Mountain Alpine Resort Management Board
Loddon Mallee Waste and Resource Recovery Group 
Lower Murray Urban and Rural Water Corporation
Mallee Catchment Management Authority
Melbourne Water Corporation
Metropolitan Waste and Resource Recovery Group
Ministerial advisory committees (various)
Mount Baw Baw Alpine Resort Management Board
Mount Buller and Mount Stirling Alpine Resort Management Board
Mount Hotham Alpine Resort Management Board
National Parks Advisory Council
North Central Catchment Management Authority
North East Catchment Management Authority
North East Region Water Corporation
North East Waste and Resource Recovery Group
Parks Victoria 
Port Phillip and Westernport Catchment Management Authority
Reference Areas Advisory Committee
Royal Botanic Gardens Board Victoria
Scientific Advisory Committee
South East Water Corporation
South Gippsland Region Water Corporation
Sustainability Victoria
Trust for Nature (Victoria)
Trustees for Crown land reserves 2
Victorian Catchment Management Council
Victorian Coastal Council
Victorian Environmental Assessment Council
Victorian Environmental Water Holder
Victorian Mineral Water Committee
Wannon Region Water Corporation
West Gippsland Catchment Management Authority
Western Coast Regional Coastal Board
Western Region Water Corporation
Westernport Region Water Corporation
Wimmera Catchment Management Authority
Yarra Valley Water Corporation
Yorta Yorta Traditional Owner Land Management Board
Zoological Parks and Gardens Board
Planning
Architects Registration Board of Victoria and Panel List
Building Advisory Council
Building Appeals Board
Building Practitioners Board
Building Regulations Advisory Committee
Environmental Effects Inquiries established under the Environmental Effects Act 1978 (various)
Geographic Place Names Advisory Panel
Growth Areas Infrastructure Contribution Hardship Relief Board
Heritage Council
Metropolitan Planning Authority (Growth Areas Authority)
Places Victoria (Urban Renewal Authority Victoria) 
Planning panels and advisory committees established under the Planning and Environment Act 1987 (various)
Plumbing Advisory Council
Surveyors Registration Board of Victoria
Victorian Building Authority
Local Government
Councillor Conduct Panel List3
Panels of Administrators (Brimbank, Geelong4 and Wangaratta)
Local Government Ministerial Mayors Advisory Panel
Victoria Grants Commission
Note:
1.	There are approximately 1,200 Crown land committees of management in the DELWP portfolio. Major committees of management include: Phillip Island Nature Park Board of Management, Barwon Coast Committee of Management, Bellarine Bayside Foreshore Committee of Management, Great Ocean Road Coast Committee, Otway Coast Committee, Working Heritage, and Winton Wetlands Committee of Management
2.	There are approximately 60 trustees for Crown land reserves, including Caulfield Racecourse Reserve Trustees
3.	The Councillor Conduct Panel List was established under the Local Government Act 1989 in March 2016. 
4.	The Panel of Administrators - Greater Geelong was established in April 2016 under the Local Government (Greater Geelong City Council)  Act 2016 
Acts administered 
Environment, Climate Change and Water1
Aboriginal Lands Act 1991
This Act is jointly and severally administered with the Minister for Aboriginal Affairs.
Alpine Resorts Act 1983
Alpine Resorts (Management) Act 1997 
Catchment and Land Protection Act 1994 
Climate Change Act 2010
Coastal Management Act 1995 
Commissioner for Environmental Sustainability Act 2003 
Conservation, Forests and Lands Act 1987 
Parts of the Act are either solely, jointly, or jointly and severally administered with the Minister for Agriculture. 
Crown Land (Reserves) Act 1978
Except for certain specified Crown allotments administered by other Ministers and the Assistant Treasurer.
Cultural and Recreational Lands Act 1963
Dental Hospital Land Act 2011
Environment Protection Act 1970 
Flora and Fauna Guarantee Act 1988 
Except section 5 and Parts 3 and 5 and Division 1 and 2 of Part 6, which are jointly administered with the Minister for Agriculture.
Forests Act 1958 
Except certain provisions which are either solely or jointly and severally administered with the Minister for Agriculture.
Geelong Lands (Steampacket Place) Act 1996
Geelong Market Site Act 1983
Groundwater (Border Agreement) Act 1985 
Heritage Rivers Act 1992 
Land Act 1958
Except for certain specified areas of land managed by other Ministers through agencies such as the Office of Corrections, Courts Services and the Department of Health.
Land Conservation (Vehicle Control) Act 1972 
Except section 3 which is jointly administered with the Minister for Agriculture. 
Land (Goonawarra Golf Course) Act 1988
Land (Reservations and other Matters) Act 1997
Land (Reservations and other Matters) Act (various years)
Land (Revocation of Reservations) Act 2012
Land (Revocation of Reservations) Act (various years)
Land (St. Kilda Sea Baths) Act 2000
Land (St Kilda Triangle) Act 2006
Melbourne and Olympic Parks Act 1985 
Sections 24-28 of the Act. The remaining provisions are administered by the Minister for Tourism and Major Events and the Premier.
Melbourne (Yarra Park) Land Act 1980 
Murray-Darling Basin Act 1993
National Environment Protection Council (Victoria) Act 1995
National Parks Act 1975 
Parks and Crown Land Legislation (Mount Buffalo) Act 2010
Parks Victoria Act 1998
Pollution of Waters by Oil and Noxious Substances Act 1986
Sections 8-13, 18-23 and 23B, 23D, 23E, 23G, 23J, 23K, 23L and 24E of the Act.  Sections 30 and 47 are jointly administered with the Minister for Ports. The remainder of the provisions are solely administered by the Minister for Ports.  
Queen Victoria Market Lands Act 1996
Reference Areas Act 1978
Royal Agricultural Showgrounds Act 2003
Royal Botanic Gardens Act 1991
Royal Children’s Hospital (Land) Act 2007
Royal Women’s Hospital Land Act 2012
Safety on Public Land Act 2004
Except in so far as it relates to declaring, managing and enforcing public safety zones for the purposes of timber harvesting operations, as those matters are jointly and severally administered with the Minister for Agriculture.
South Melbourne Land Act 1986 
Southgate Project Act 1994
State Owned Enterprises Act 1992
Division 2 of Part 2 insofar as it relates to the Victorian Plantations Corporation; Division 2 of Part 2 insofar as it relates to the Water Training Centre. The Act is otherwise administered by the Premier, Minister for Finance, Minister for Multicultural Affairs and the Treasurer.
Sustainable Forest (Timber) Act 2004
Part 2, section 45, Division 1 of Part 6 and  Part 8 of the Act.  Sections 3, 22, 23(1) and  24 and Part 9 are jointly administered with the Minister for Agriculture.  The Act is otherwise administered by the Minister for Agriculture.  
Sustainability Victoria Act 2005
Swan Hill Pioneer Settlement Authority (Repeal) Act 1994 
Temperance Halls Act 1958
University of Melbourne Land Act 2000
Victorian Conservation Trust Act 1972
Victorian Environment Assessment Council  Act 2001
Victorian Plantations Corporation Act 1993
Water Act 1989 
Water (Commonwealth Powers) Act 2008
Water Efficiency Labelling and Standards Act 2005 
Water Industry Act 1994
Wildlife Act 1975
Except for Part 1 (except section 4B), Parts III, IIIA, VIII and IX, sections 16, 35, 41-44, 47D, 48-48C, 53-58B, 86-86C, and 87 (insofar as it relates to the effective management of hunting, including preserving good order among hunters of wildlife) (which are jointly administered with the Minister for Agriculture); and Part IIIB (insofar as it relates to the hunting of game) and sections 58C, 58D and 58E (these sections are administered by the Minister for Agriculture).
Zoological Parks and Gardens Act 1995 
Planning
Architects Act 1991
Building Act 1993
Building and Construction Industry Security of Payment Act 2002
Casino Control Act 1991
Sections 128H-128L, except for section 128K(2). The Act is otherwise administered by the Minister for Finance and the Minister for Consumer Affairs, Gaming and Liquor Regulation).
City of Greater Geelong Act 1993
Part 5 of the Act. The Act is otherwise administered by the Minister for Local Government. 
Docklands Act 1991
Electronic Conveyancing (Adoption of National Law) Act 2013
Electronic Conveyancing National Law (Victoria)
Environment Effects Act 1978
Geographic Place Names Act 1998
Heritage Act 1995
Instruments Act 1958 
Only in so far as it relates to the functions of the Registrar-General and the management of the Office of the Registrar-General. The Act is otherwise administered by the Attorney General.
Nudity (Prescribed Areas) Act 1983
Planning and Environment Act 1987
Except Part 9B, which is jointly and severally administered with the Treasurer.
Planning and Environment (Planning Schemes) Act 1996
Project Development and Construction Management Act 1994 
Part 5A of the Act (insofar as it relates to the exercise of powers and functions under  Part 9A of the Planning and Environment Act 1987), section 46, and Part 7. The Act is otherwise administered by the Minister for Finance, the Minister for Employment and the Premier.
Property Law Act 1958 
Only in so far as it relates to the functions of the Registrar-General and the management of the Office of the Registrar-General. The Act is otherwise administered by the Attorney-General. 
Residential Tenancies Act 1997 
Part 14 of the Act. The Act is otherwise administered by the Attorney-General, the Minister for Consumer Affairs, Gaming and Liquor Regulation and the Minister for Housing, Disability and Ageing. 
South Yarra Project (Subdivision and Management) Act 1985
Subdivision Act 1988
Except Part 5 and section 43 (in so far as it relates to Part 5). These provisions are administered by the Minister for Consumer Affairs, Gaming and Liquor Regulation.  
Survey Co-ordination Act 1958
Surveying Act 2004
Transfer of Land Act 1958 
In so far as it relates to the functions of the Registrar of Titles and the management of the Office of Titles. The Act is otherwise administered by the Attorney-General. 
Urban Renewal Authority Victoria Act 2003
Valuation of Land Act 1960
Except Divisions 1 and 2 of Part III, Divisions 4 and 5 of Part III (insofar as they relate to the determination of appeals by a Land Valuation Division of the Victorian Civil and Administrative Tribunal), and Part IV (in so far as it relates to the administration of the above provisions).   These provisions are administered by the Attorney-General. 
Local Government
City of Greater Geelong Act 1993
Except Part 5. This Part is administered by the Minister for Planning. 
City of Melbourne Act 2001
Libraries Act 1988 
Part 4 and section 53 (insofar as it relates to Part 4). The Act is otherwise administered by the Minister for Creative Industries.
Local Government Act 1989
Except sections 44-46, 48 and 49 (these sections are administered by the Attorney-General); section 243 (insofar as it relates to municipal electoral tribunals, this section is administered by the Attorney-General); schedule 4 (this Schedule is administered by the Attorney-General); sections 223A, 223B and 223C (these sections are administered by the Special Minister of State); section 243 (insofar as it relates to the inspectors of municipal administration, this section is administered by the Special Minister of State); clauses 4 and 9(3) of Schedule 11 and section 123 (insofar as it relates to the revocation of local laws made pursuant to the powers conferred by those clauses by reason of section 207 of the Act). These provisions are administered by the Minister for Roads and Road Safety. 
Local Government (Brimbank City Council) Act 2009
Local Government (Greater Geelong City Council) Act 2016 
Local Government (Rural City of Wangaratta) Act 2013
Municipal Association Act 1907
Municipalities Assistance Act 1973
Prahran Mechanics’ Institute Act 1899
Victoria Grants Commission Act 1976
Note:
1	Energy will be included in this list in the  2016-17 Annual Report, in line with MoG changes that transferred Energy to DELWP from 1 July 2016.
Implementation of the Victorian Industry Participation Policy (VIPP)  
In October 2003 the Victorian Parliament passed the Victorian Industry Participation Policy Act 2003 which requires public bodies and departments to report on the implementation of the Victorian Industry Participation Policy (VIPP). VIPP requires opportunities for local supply and/or participation to be identified as part of the tendering process. Departments and public bodies are required to apply VIPP in all tenders over $3 million in metropolitan Melbourne and  $1 million in regional Victoria.
Contracts commenced
During 2015-16, the department commenced  20 contracts totalling $91 million in value to which the VIPP applied. The contracts commenced included five in metropolitan Melbourne with a total value of $24.2 million,  11 in regional Victoria with a total value of  $27.2 million and four statewide with a total value of $39.6 million.
The number and percentage of ‘local content’ committed under the contracts that commenced in 2015-16 where a VIPP Plan was not required (due to nil or limited contestability) was split by:
(i)	six contracts with local content ranging between 85 per cent and 100 per cent that are local by nature 
(ii)	five contracts with local content ranging between 15 per cent and 50 per cent that are international by nature. 
There are 21 small and medium sized businesses that prepared a VIPP Plan for contracts which commenced in 2015-16.
The number and percentage of ‘local content’ committed under contracts that commenced in 2015-16 to which a VIPP Plan was required are split by projects that are:
(i)	metropolitan based - one contract with local content of 100 per cent
(ii)	statewide/regionally based - eight contracts with local content between 77 per cent and 99 per cent.
The commitments by contractors under VIPP as a result of these contracts included 273 Annualised Employee Equivalent positions and 53 apprentices/trainees. 
Benefits to the Victorian economy from these commitments in terms of skills and technology transfer increases include: 
research and development programs
plant operator
occupational health and safety training
traffic management
various computer programs
red card induction
occupational medicine
audiometry and spirometry.
Contracts completed
During 2015-16, DELWP completed 19 contracts totalling $80.8 million in value to which VIPP applied. The contracts included one in metropolitan Melbourne with a total value of $4.3 million, 10 contracts in regional Victoria with a total value of $19.8 million and eight statewide contracts with a total value of  $56.7 million.
The number and percentage of ‘local content’ under contracts completed in 2015-16:
VIPP Plan was not required:
(i)	regionally based - five contracts that were local by nature with local content ranging between 85 per cent and 100 per cent and one international by nature with 14 per cent local content.
VIPP Plan was required:
(i)	metropolitan based - one contract with local content of 70 per cent
(ii)	regionally based - five contracts with local content ranging between 80 per cent and 100 per cent
(iii)	statewide based – seven contracts with local content ranging between 71 per cent and 100 per cent.
The achieved outcomes reported by contractors under VIPP include 272 Annualised Employee Equivalent and 41 apprentices/trainees Annualised Employee Equivalent positions.
Benefits to the Victorian economy in terms of increased skills and technology transfer in the following areas:
research and development programs
drainage and culvert construction
structural concrete construction
road pavement construction
earthworks and plant operating
carpentry
steel reinforcement handling and tying
guard fence and traffic barrier installation
project induction
operation of new specialised equipment
helicopter underwater escape training and crew resource management
occupational health and safety
fire support operations
business management systems
operational surveillance and mapping
pilot aerial firefighting
first aid training
wildfire awareness training
air attack supervision
aerial firebombing
airborne infra-red and camera systems
fire bombing.
DELWP did not award any grant or design contracts that met the VIPP threshold in 2015-16.
Consultancies * 
In 2015-16, there were 44 consultancies where the total fees payable to the consultants were $10,000 or greater. The total expenditure incurred during 2015-16 in relation to these consultancies is $3.155 million (excluding GST). Details of individual consultancies are available on request, subject to the provisions of the Freedom of Information Act 1982.
In 2015-16, there were 13 consultancies where the total fees payable to the consultants were less than $10,000. The total expenditure incurred during 2015-16 in relation to these consultancies is $0.089 million (excluding GST).
Disclosure of major contracts 
During 2015-16, the department entered into two contracts greater than $10 million in value. Details of the contracts were published on the Victorian Government’s contracts publishing system and can be viewed online  (http://www.tenders.vic.gov.au).
Disclosure of government advertising expenditure 
DELWP conducted an external communications campaign focused on informing communities about the planned burning work program and how to find further information about the location and time of planned burns. The campaign included advertising, media placement, roadside signage, online notifications and social media. Advertisements and other communications also advised people to be aware of the potential to see or smell smoke as a result of planned burns.

* Corrects a calculation error published in the Annual Report

Campaign name	Start / end date	Advertising (media expenditure)
(ex GST)	Creative and campaign development expenditure
(ex GST)	Research and evaluation expenditure 
(ex GST)	Print and collateral expenditure 
(ex GST)	Other campaign expenditure
(ex GST)	Total	
Planned  burning	14 September 2015 to  31 May 2016	$222,312	$8,285	$74,249	$0	$165,039	$469,885	

Details of Information and Communications Technology (ICT) expenditure
ICT expenditure refers to the department’s costs in providing business enabling ICT services. It comprises Business As Usual (BAU) ICT expenditure and Non Business As Usual (Non BAU) ICT expenditure. Non BAU ICT expenditure relates to extending or enhancing the department’s current ICT capabilities. BAU ICT expenditure is all remaining ICT expenditure which primarily relates to ongoing activities to operate and maintain the current ICT capability.
For the 2015-16 reporting period, the department had a total ICT expenditure of $107 million with the details shown below:
Business As Usual (BAU) 
(Total)
$’000	Non Business As Usual (non BAU) 
(Total = Operational expenditure and Capital Expenditure)
$’000	Operational expenditure
$’000	Capital expenditure
$’000	
$ 73,358	$ 33,523	$30,169	$ 3,354	

Further detail on ICT Reporting standards and guidelines can be found at http://www.enterprisesolutions.vic.gov.au. 
Total ICT expenditure = ICT BAU expenditure + ICT Non BAU expenditure.
Freedom of Information
The Freedom of Information Act 1982 gives everyone the right to seek access to documents held by government. The department’s Freedom of Information (FOI) Unit can be contacted on 9637 8331 or by email:  foi.unit@delwp.vic.gov.au.
FOI requests have to be made in writing. A request can be submitted using the website FOI Online (www.foi.vic.gov.au) or by sending an application to:
Freedom of Information
Department of Environment, Land, Water and Planning
PO Box 500
East Melbourne Victoria 8002
From 1 July 2016, the application fee to make an FOI request is $27.90. DELWP can waive this fee in certain circumstances. There may be further charges depending on the time it takes to find the documents and photocopy them and the number of pages to be photocopied. 

For the period from 1 July 2015 to 30 June 2016, the department received 169 new FOI requests. They came from:
	Number	Per cent	
Individuals	66	39%	
Members of Parliament	57	34%	
Lawyers	23	14%	
Journalists	11	7%	
Community groups	7	4%	
Companies	5	2%	

For the same period, the department made decisions on 122 requests. Ten of these requests were received during the previous financial year. The outcomes were:
	Number	Per cent	
Full access granted	26	21%	
Partial access granted 	57	47%	
Access denied	9	6%	
No relevant documents found 	30	26%	

The processing time for the FOI requests is shown below, with an average of 40 days.
	Number	Per cent	
0 – 45 days	91	75%	
46 – 90 days	22	18%	
91+ days	9	7%	

The department closed 29 requests, including one received during the previous financial year, with the outcomes shown below:
	Number	
Request not processed *	18	
Unreasonable diversion	11	

*Request not processed includes: all requested documents released outside the Act; request withdrawn by applicant; deposit not paid.
The department also responded to an additional 45 requests, including six received during the previous financial year, with the outcomes shown below:
	Number	
Invalid request *	18	
Transferred	27	

*Application fee not paid or request terms unclear and applicant did not provide clarification.
Freedom of Information Commissioner
Reviews
Notification of 12 requests for a review of an FOI decision were received from the Freedom of Information Commissioner (FOI Commissioner) between 1 July 2015 and 30 June 2016. Four reviews are complete. Eight are ongoing. 
Complaints
The department was advised by the FOI Commissioner’s office of three complaints made about the processing of applicants’ FOI requests, or decisions that no relevant documents were identified.  Two complaints have been closed. One is ongoing.
Victorian Civil and Administrative Tribunal 
No applications for review of FOI decisions made by the department were made to the Victorian Civil and Administrative Tribunal.
Heritage Victoria permit applications and Victorian Heritage Database 
Publicly advertised permit applications and decisions can be viewed online at:  http://www.dtpli.vic.gov.au/heritage
The Victorian Heritage Database is a fully searchable online database containing information about registered heritage places and objects, including statements of significance, physical descriptions, historical information and photographs.
The Vic-Heritage app (for iOS devices) draws on the Victorian Heritage Register and invites user contribution to add to the knowledge, images and appreciation of registered places.

Heritage Victoria also has the following information available online:
http://twitter.com/heritagevic 
www.flickr.com/photos/heritage_victoria/sets
www.youtube.com/vicheritage
Planning
DELWP is responsible for managing the state’s planning, heritage and building systems, including developing and driving implementation of long-term planning policies such as Plan Melbourne and Regional Growth Plans, developing policies to support resilient communities, administering statutory planning responsibilities, and facilitating urban development. 
There is an extensive amount of information available on the DELWP website. All Victorian planning schemes including exhibited and approved amendments are published at Planning Schemes Online. The Minister’s Planning Permit Application Register Online provides access to up-to-date information on the status of permit applications where the Minister for Planning is the Responsible Authority. The Planning Property Report provides easy access to planning scheme information for any property in Victoria, including property details like zoning and overlay controls, and state heritage information where it applies to land. The report can be accessed from the website or from PlanningVIC: Planning Property Report, the app for iOS and Android mobile devices.
For assistance with finding information, using any of our web services or general planning enquiries, please contact the Victorian Government Contact Centre on 1300 366 356 (local call cost).
For more detailed information about planning scheme amendments, please contact the relevant DELWP regional office or email: planning.schemes@delwp.vic.gov.au.
DELWP also provides online access to planning information, forms and services through the DELWP website. 
Compliance with the Protected Disclosure Act 2012 
DELWP did not directly receive any Protected Disclosures during 2015-16.
Protected disclosures about this department, or any of its employees and / or officers, may be made to the following officers:
Jennifer Berensen
Protected Disclosure Coordinator
Department of Environment, Land, Water and Planning
PO Box 500
East Melbourne Victoria 8002
Telephone: (03) 9637 8697              
email: protected.disclosures@delwp.vic.gov.au
Stuart Atkins 
Manager, FOI and Privacy – Protected Disclosure Officer 
Department of Environment, Land,  Water and Planning 
PO Box 500
East Melbourne Victoria 8002
Telephone (03) 9637 8331          
email: protected.disclosures@delwp.vic.gov.au
The Independent Broad-based Anti-corruption Commission (IBAC)
Level 1, North Tower
459 Collins Street
Melbourne Victoria 3000
GPO Box 24234, Melbourne Victoria 3001
Telephone: 1300 735 135
Website: www.ibac.vic.gov.au  
Any written communication should be clearly marked “PRIVATE and CONFIDENTIAL for addressee only”.
Further information about protected disclosures can be found on the department’s website at www.delwp.vic.gov.au. 
Compliance with the Carers Recognition Act 2012 
DELWP has taken all practical measures to comply with its obligations under the Act. These include: 
Events held in recognition of National Carers Week in October 2015. All workplaces across DELWP were encouraged to celebrate Carers week locally, with activities to recognise local carers, supported by an electronic resource pack. Information about support available to DELWP employees is regularly communicated via an internal online Parents and Carers network.
Consideration of the carer relationship principles set out in the Act when setting policies and providing services (e.g. reviewing our employment policies such as flexible working arrangements and leave provisions to ensure that these comply with the statement of principles in the Act; developing a satisfaction survey for distribution at assessment and review meetings between workers, carers and those receiving care).
Compliance with the Building Act 1993
DELWP complies with the Building Act 1993, the Building Regulations 2006 and associated statutory requirements and amendments.  Either an Occupancy Permit or a Certificate of Final Inspection, endorsed by a Registered Building Surveyor Practitioner, is obtained for new facilities or upgrades to existing facilities.
Major works projects commenced or completed in 2015-16 include:
Knoxfield office and depot redevelopment
Noojee office and depot redevelopment
Rushworth depot redevelopment
Gellibrand office and depot redevelopment
Mitta Valley office and depot development
Altona depot radio workshop and pump test facility
Orbost North depot redevelopment.
Maintenance of buildings in a safe and serviceable condition
DELWP’s leased portfolio is managed by the Department of Treasury and Finance’s Shared Service Provider. DELWP also has a facilities management contract with JLL, formerly Five D Holdings Pty Ltd, for 154 of its owned portfolio assets. The owned portfolio includes offices, combined office/depot sites, depots, residences, airbases and fire lookout towers. DTF and JLL are responsible for maintaining the buildings in a safe and serviceable condition and for providing the annual essential safety measures report for the assets. Quality assurance, performance measures and governance are incorporated into the contract to ensure that contract requirements are met and standards maintained.
Compliance with the Local Government Act 1989
Annual Reports 2014-15
Councils and regional library corporations are required to submit annual reports within three months of the end of the financial year or such longer period, as the Minister for Local Government may permit in a particular case, pursuant to the Local Government Act 1989.
Sections 133(4) and 196(7) of the Act require the Secretary of the department to report any council or regional library’s failure to submit its annual report within the time allowed.
Ballarat City Council and Mornington Peninsula Shire Council were late in submitting their annual report for 2014–15.
Budgets 2015-16
Sections 130(6) and 196(7) of the Act require the Secretary of the department to report any council or regional library’s failure to submit its adopted budget within the time allowed.
No council or regional library was late in submitting its adopted budgets for 2015-16.
Compliance with the Heritage Act 1995 
Protocol for disclosure of interests 
Part 4 of Schedule 1 of the Heritage Act 1995 deals with disclosure of interests in respect to matters considered by Heritage Council and committees established by the Heritage Council. 
A member of the Heritage Council, the Executive Director of Heritage Victoria, a member of a Heritage Council committee, or member of an advisory committee established under s10 of the Act, must disclose direct or indirect pecuniary interest in respect to contracts or matters being considered by the Heritage Council. 
A Protocol for Disclosure of Interests (approved by the Heritage Council in December 2006) has been developed to support application of this part of the Act.
Disclosures are recorded in the minutes of the meetings of the Heritage Council.
Compliance with DataVic Access Policy 
In August 2012, the Victorian Government released the DataVic Access Policy, which enables the sharing of Government data at no, or minimal, cost to users.  At the end of 2015-16, DELWP had released more than 3,000 datasets and web mapping services under the Policy.
Consistent with the DataVic Access policy, all data tables included in this Annual Report will be available at http://www.data.vic.gov.au/ in electronic readable format. 
National Competition Policy 
In 1995, the federal, state and territory governments agreed to review and, where appropriate, reform all existing legislative restrictions on competition. Under the National Competition Policy, the guiding legislative principle is that legislation, including future legislative proposals, should not restrict competition unless it can be demonstrated that: 
the benefits of the restriction to the community as a whole outweigh the costs
the objectives of the legislation can only be achieved by restricting competition. 
The department has reviewed all legislation under its control, and continues to apply the competition assessment guidelines in the Victorian Guide to Regulation to all new legislative proposals.
Competitive neutrality requires government businesses to ensure where services compete – or potentially compete – with the private sector, any advantage arising solely from their government ownership be removed if they are not in the public interest. Government businesses are required to cost and price these services as if they were privately owned and thus be fully cost-reflective. Competitive neutrality policy provides government businesses with a tool to enhance decisions on resource allocation. This policy does not override other policy objectives of government and focuses on efficiency in the provision of service. The department will ensure that requirements on competitive neutrality are fulfilled.
Lancefield-Cobaw planned burn 
On 30 September 2015, DELWP conducted a planned burn at Lancefield-Cobaw Croziers Track in the Macedon Ranges – a standard practice in DELWP’s Bushfire Fuel Management Program. Three days later, the burn breached containment lines and burned for a further  10 days. The fire was contained on 13 October 2015 after burning more than 3,000 hectares, destroying a number of dwellings, sheds, and many kilometres of fencing.
In response to the fire, the Victorian Government announced an independent investigation to be led by Mr Murray Carter, Director of the Office of Bushfire Risk Management in Western Australia. The Terms of Reference stated that the investigation was to focus on: 
the adequacy of planning and resourcing of the Lancefield-Cobaw Croziers Track planned burn (the planned burn)
the appropriateness of the weather and other conditions for conduct of the planned burn on         30 September 2015
what caused the planned burn to break containment lines on 3 October 2015 and on 6 October 2015
decision making, management and control of the planned burn, including the adequacy of the patrol strategy adopted following its ignition
the adequacy of communication with the community in the lead up to the planned burn and after it broke containment lines.
The Investigation recommended improvements to the systems and processes of DELWP crucial to the delivery of planned burning throughout Victoria. All 22 of the recommendations were accepted by DELWP, as well as a commitment to making changes to the way it operates across the state, to improve delivery of Victoria’s planned burning program. 
DELWP’s Response to the recommendations of the independent investigation into the Lancefield-Cobaw fire also outlined additional commitments to improve the delivery of the Bushfire Fuel Management Program. Broadly, these additional commitments included: 
rebuilding community trust
making it clear who is in charge of the planned burning program
implementing improved systems and processes
addressing other issues in the planned burning program
building on the positives
independent oversight of the monitoring and reporting of the implementation of recommendations. 
DELWP developed a program of work to implement the 22 recommendations and  10 commitments that were grouped under seven themes:
implementation of Safer Together
implementing improved systems and processes
audit and quality assurance framework
organisation structure
operational improvements
community engagement
independent oversight.
The Inspector-General for Emergency Management (IGEM) released its final  (August 2016) progress report on implementation of recommendations and commitments from the independent investigation into the Lancefield-Cobaw fire. In the final progress report, IGEM found that the department had satisfactorily implemented 19 of the 22 recommendations and all 10 of the additional commitments made by the department. The three outstanding recommendations will be implemented as part of Safer Together, the government’s new approach to reducing the risk of bushfires in Victoria. IGEM will report on implementation of these three recommendations as part of the Safer Together progress reporting.
Implementation of Victorian Bushfires Royal Commission recommendations and actions 
In September 2014, the Victorian Government requested the IGEM to monitor and report annually on the progress made against ongoing Victorian Bushfires Royal Commission (VBRC) recommendations and actions. As part of this reporting, IGEM requested all departments to include their progress towards implementing their actions in their annual report. Below is a summary of DELWP’s progress on the five actions it has accountability for:
22(k) Fire Agencies to develop and enhance fire information systems and upgrade existing tools such as FireWeb
Three projects were developed to complete this action:
(1)	An infrastructure project that will support the delivery of the new systems and tools. This project is now complete.
(2)	The eWeb project that will replace the FireWeb platform after the 2015-16 summer season. Completion of the eWeb build is expected by late 2016.
(3)	The Fuel Management System (FMS) to replace the Burns and Works module in FireWeb. A phased implementation of FMS will begin in August 2016, with FMS to have fully replaced the Burns and Works module by April 2017.
IGEM considers this action to be closed.
49(h) Amend Building Regulations 2006 to adopt performance requirements
The Minister for Planning approved drafting of the new regulations on 29 March 2016. 
The proposed amendments will: 
require an assessment of the building’s potential exposure to bushfire attack
impose construction requirements according to the assessed exposure to bushfire risk
require a minimum construction standard that ensures each building is able to better withstand an ember attack.
This action is expected to be completed by August 2016, subject to relevant approvals. IGEM will continue to monitor progress. 
56(d) Increased planned burning to 390,000 ha
See 56(f) for progress.
56(f) Identify changes required to effectively and efficiently achieve the target planned burn
Since 2010 there has been a significant increase in the investment and corresponding targets for fuel management.  In 2015-16 the fuel management target was 275,000 hectares. In 2015-16 the department undertook almost 200,000 hectares of fuel management.  This is the final year of a hectare based target.
IGEM’s Review of Performance Targets for Bushfire Fuel Management on Public Land (2015) recommended a risk reduction target as the most effective form of performance target for bushfire fuel management on public land. DELWP’s response to the review, Safer Together: A New Approach to Reducing the Risk of Bushfire in Victoria, has set a target of using fuel management on public land to maintain statewide bushfire risk at or below 70 per cent. This target takes effect as of 1 July 2016.
IGEM considers these actions to be closed.
59(b) Amend operational manuals and guides and advise all staff
DELWP has adopted a new document control system and framework for all of DELWP’s fire management manuals and over the past few years has been progressively updating the fire management manuals.
Progress of the manuals is as follows:
Response (completed on 8 December 2014)
Preparedness (completed mid-August and comes into effect on 29 August 2016)
Prevention (due for completion 2016-17)
Fuel Management (completed June 2016 and comes into effect in August 2016)
Recovery (will be completed as part of the Recovery Framework commencing in the 2016-17 financial year)
Occupational Health and Safety (incorporated into each of the other manuals).
As manuals or sections of manuals are approved, they are immediately published on FireWeb, therefore becoming available to DELWP and partner agencies.
IGEM considers this action to be closed.
Compliance with the Planning and Environment (Growth Areas Infrastructure Contribution) Act 2010
Part 9B of the Planning and Environment Act 1987 came into effect on 1 July 2010. Growth Areas Infrastructure Contribution (GAIC) information is available on DELWP, Metropolitan Planning Authority (MPA) and State Revenue Office (SRO) websites.  GAIC applies to particular land in Melbourne metropolitan growth areas. 
The MPA is responsible under the Act to notify SRO and the Registrar of Titles of the properties that fall within the GAIC area. 
The SRO retains a record of those properties liable for GAIC, and is responsible for determining and collecting any GAIC liability. 
The Registrar of Titles is responsible for placing a GAIC notice on each affected property title and will not allow any land dealings, in relation to those properties, without receipt of an appropriate GAIC certificate and notice, as issued by SRO.
The MPA investigates any planning and zoning anomalies that may be raised as they relate to GAIC, and progresses staged payment agreement (SPA) inquiries and applications from landowners subdividing land in Melbourne’s growth areas.
MPA provides secretarial support to the GAIC Hardship Relief Board (HRB). The HRB meets when required to consider applications for hardship relief. During the year ended  30 June 2016 the Board made no decisions on hardship applications and at 30 June 2016 there were no active applications before the Board (as at 30 June 2015, there were 0).
Under section 45 of the Financial Management Act 1994 and section 201VC of the Act the MPA and DELWP are required to report annually on the operation of the GAIC.
GAIC Funds
The amounts received by the SRO, net of any GAIC interest received and refunds made, are paid into the Consolidated Fund by section 201SZJ of the Act and then periodically drawn down equally into two GAIC funds held by DELWP, the Building New Communities Fund (BNCF) and the Growth Areas Public Transport Fund (GAPTF) by section 201V(2) of the Act. For the financial year ended 30 June 2016, an amount of $29,373,000 (30 June 2015 - $12,521,213) has been transferred to each of the funds to make a combined total of $58,746,000 (30 June 2015 – $25,042,426).
The total amount of GAIC received by the SRO and paid into the Consolidated Fund under section 201SZJ at 30 June 2016 was $176,010,655 (30 June 2015 - $108,672,638). The amount of GAIC receipts transferred to the two GAIC Funds under section 201V(2) at 30 June 2016 was $146,558,962 (30 June 2015 - $87,812,962).  The remaining GAIC receipts in the Consolidated Fund at 30 June 2016 of $29,451,693 (30 June 2015 - $20,859,642) is to be transferred in the next financial year.
The amount that has been paid out of the GAIC Funds for the year ending 30 June 2016 is $1,000,000 for one project from the BNCF, and $634,537 for SRO expenses from the GAPTF, a total of $1,634,537.
SRO expenses are only payable from GAPTF with approval of the Treasurer and therefore may not be paid in the financial year incurred. Accordingly, SRO expenses for the period 1 January 2016 to 30 June 2016 totalling $226,602.13 remain outstanding and will be paid in the 2016-17 financial year. On average over the six years of GAIC SRO expenses average approximately $470,000 per annum.

GAIC works-in-kind
A works-in-kind (WIK) agreement may be entered into by a person liable to pay GAIC, with the Minister for Planning, under which they agree to provide land and/or works (construction of State infrastructure) instead of a cash payment, to meet the GAIC liability in whole or in part. There were no GAIC WIK agreements at 30 June 2016 (as at 30 June  2015 – nil).
The GAIC Works-In-Kind Guidelines and Model Agreements are comprehensive and links to them can be found on the Authority’s website www.mpa.vic.gov.au.
GAIC rates per hectare of contribution area as adjusted in accordance with section 201SG of the Act
Land Type	Year ended 30 June 2016	Year ended 30 June 2015	
Type A	$90,470	$88,770	
Type B1, B2 & C	$107,440	$105,420	

The amount of GAIC triggered and received in the financial year ended 30 June 2016 is shown below.
Summary of GAIC transactions for the year ended 30 June 2016
	Number of transactions for the year ended  30 June 2016	Transaction value for the year ended 30 June 2016	Number of transactions for the year ended  30 June 2015	Transaction value for the year ended  30 June 2015	Note	
GAIC Receipts	136	$67,338,051	78	$40,370,936	1	
GAIC Refunds	0	$0	0	$0	2	
GAIC Deferred	39	$40,218,655	23	$13,305,381	3	
Staged Payment Arrangements processed by SRO	28	$106,347,703	21	$64,212,166	4	
Net Staged Payments Outstanding	76	$114,238,462	57	$74,621,911	5	

Note:
1.	The GAIC receipts by the SRO includes interest received and refunds made, and has been paid into the Consolidated Fund.
2.	There were no GAIC refunds for the financial year ended 30 June 2016 (30 June 2015 – nil).
3.	Deferrals arise from purchase transactions whereby the liable party elects to defer all, or part of their GAIC liability until the next GAIC event. Should the liable party elect to defer part of the liability then a payment of the non-deferred portion of the total liability is due. The reported Total GAIC Deferred for the year is the total amount elected to have been deferred during the financial year. Some of those amounts may have subsequently been paid, or have been converted into Staged Payment arrangements.
4.	The Minister for Planning, or the Chief Executive Officer of the MPA under delegated authority, approves staged payment arrangements. The SRO processed approved staged payment arrangements in relation to 28 GAIC events during the year ended 30 June 2016 (30 June 2015 - 21). The value of the staged payment arrangements processed for the year ended 30 June 2016 was $106,347,703 (30 June 2015 – $64,212,166).
5.	The outstanding amounts in relation to approved staged payments arrangements are to be progressively reduced in accordance with the agreed payment arrangements. The total outstanding staged payments that had been approved by 30 June 2016, and were due for payment after 30 June 2016 amount to $114,238,462 (30 June 2015 – $74,621,911). 76 staged payment arrangements were still current as at 30 June 2016 (30 June 2015 – 57).
GAIC receipts made and expenditure paid out in each Growth Area
Growth area	GAIC receipts to 1 July 2015
$	GAIC receipts for year ended  30 June 2016
$	Total GAIC receipts for each Growth Area as at  30 June 2016
$	Total paid out of contributions received for each Growth Area as at  30 June 2016
$	Proportion paid out of contributions received for each Growth
Area*%	
Casey**	39,096,225	20,254,022	59,350,247	2,015,162	3.4	
Cardinia**						
Hume	28,539,954	18,968,068	47,508,022	3,104,332	6.5	
Melton	28,902,382	14,871,202	43,773,584	1,283,646	2.9	
Mitchell	626,704	0	626,704	23,334	3.7	
Whittlesea	0	0	0	0	–	
Wyndham	11,507,339	13,244,759	24,752,098	1,159,732	4.7	
Total	$108,672,604	$67,338,051	$176,010,655	$7,586,206	4.3%	

* Reported under section 201VC(b) of the Act
** The Casey-Cardinia Growth Area proportion of funds paid or accrued is 3.4% (30 June 2015 – 2.4%)
Building New Communities Fund by Growth Area for the year ended 30 June 2016
Growth area	Opening fund balance as at 1 July 2015 $	Interest earned for the year $	Amount paid into the fund for the year $	Amount paid from the fund for the year $	Balance of the fund as at 30 June 2016* $	
Casey**	15,165,516	98,780	8,853,129	0	24,117,425	
Cardinia**						
Hume	11,041,564	79,022	8,273,911	1,000,000	18,394,497	
Melton	11,938,847	72,749	6,468,568	0	18,480,164	
Mitchell	303,677	1,042	0	0	304,719	
Whittlesea	0	0	0	0	0	
Wyndham	3,058,933	41,171	5,777,392	0	8,877,496	
Total	$41,508,537	$292,764	$29,373,000	$1,000,000	$70,174,301	

*Reported under section 201VC(c) of the Act
**Combined Casey-Cardinia Growth Area

Allocations and payments made out of Building New Communities Fund for the year ended  30 June 2016
Allocated to	Growth area	Purpose	Original amount allocated*
$	Amount paid to 30 June 2015
$	Amount paid to  30 June 2016
$	Amount not yet paid to 30 June 2016**
$	
Department of Health and Human Services	Cardinia	Ambulatory Care Centre	2,000,000	0	0	2,000,000	
Public Transport Victoria	Casey	Berwick Station Park and Ride Upgrade	1,100,000	1,100,000	0	0	
Roads Corporation of Victoria	Casey	Upgrade of intersection South Gippsland Highway and Craig Road	1,000,000	0	0	1,000,000^	
Hume City Council	Hume	Upgrade of intersection Mickleham Road, Greenvale Gardens and Dellamore Boulevard	1,400,000	1,400,000	0	0	
Hume City Council	Hume	Car parking and public open space at Hume Regional Tennis and Community Centre	1,000,000	0	1,000,000	0	
Roads Corporation of Victoria	Melton	Traffic signals at Ferris Road interchange intersection	1,500,000	588,640	0	911,360^	
Department of Health and Human Services	Melton	Ambulatory Care Centre	5,000,000	0	0	5,000,000	
Roads Corporation of Victoria	Mitchell	Lithgow Street interchange 	100,000	0	0	100,000^	
Wyndham City Council	Wyndham	Upgrade to bus facilities, car parking and public space of Events, Aquatic and Leisure Centre	900,000	900,000	0	0	
Total			$14,000,000	$3,988,640	$1,000,000	$9,011,360	

*These allocations and payments are made net of GST.
** The net amount of allocations made out of the Building New Communities Fund not yet paid as at  30 June 2016 is  $9,011,360 (30 June 2015 - $3,011,360). Therefore, the Building New Communities Fund  balance on hand at 30 June 2016 of $70,174,301 (30 June 2015 – $41,508,537) has a commitment against  it of $9,011,360 (30 June 2015 – $3,011,360), reducing the balance available for allocation to $61,162,941  (30 June 2015 – $38,497,177).
^ These allocations are under review.
Growth Areas Public Transport Fund by Growth Area for the year ended 30 June 2016

Growth Area	Opening fund balance as at  1 July 2015
$ 	Interest earned for the year
$	Amount paid into the fund for the year
$ 	Amount paid from the fund for the year
$	Balance  of the  fund as at  30 June 2016
$	
Casey*	15,540,002	101,771	8,853,129	214,095	24,280,807	
Cardinia*	-					
Hume	11,919,762	81,414	8,273,911	171,272	20,103,815	
Melton	11,973,828	74,952	6,468,568	157,677	18,359,671	
Mitchell	281,807	1,074	0	2,259	280,622	
Whittlesea	0	0	0	0	0	
Wyndham	3,784,417	42,418	5,777,392	89,234	9,514,993	
Total	$43,499,816	$301,629	$29,373,000	$634,537	$72,539,908	
*Combined Casey-Cardinia Growth Area						
Casey-Cardinia	15,540,002	101,771	8,853,129	214,095	24,280,807	

Allocations and payments made out of the Growth Area Public Transport Fund for the year ended 30 June 2016
Allocated to	Growth area	Purpose	Original amount allocated*
$ 	Amount paid to  30 June 2015
$	Amount paid to  30 June 2016
$	Amount not yet paid to 30 June 2016**
$	
Public Transport Victoria	Hume	Craigieburn Railway Station Bus interchange and Park and Ride	4,200,000	0	0	4,200,000	
Public Transport Victoria	Mitchell	Wallan Station Parkiteer Bike Cage	100,000	0	0	100,000	
Public Transport Victoria	Whittlesea	South Morang Park and Ride	3,000,000	0	0	3,000,000^	
Total allocations	$7,300,000	$0	$0	$7,300,000			
Payment to State Revenue Office^^	$2,597,566	1,963,029	634,537	-			
Total allocations and expenditure	$9,897,566	$1,963,029	$634,537	$7,300,000			

*These allocations and payments are made net of GST.
** The net amount of allocations made out of the Growth Areas Public Transport Fund not yet paid as at 30 June 2016 is  $7,300,000 (30 June 2015 - $7,300,000). Therefore the Growth Areas Public Transport Fund balance on hand at 30 June 2016 of $72,539,907 (30 June 2015 – $43,499,816) has a commitment against it  of $7,300,000 (30 June 2015 – $7,300,000) reducing any balance available for allocation to $65,239,907  (30 June 2015 – $36,199,816).
^ This allocation is under review.
^^ A further amount of $226,602 for the period of January to June 2016 has been invoiced by the SRO and not yet paid.
Infrastructure Contribution Reporting
The provisions of the Planning and Environment Amendment (Infrastructure Contributions) Act 2016 came into effect as of 1 June 2016.  Collecting agencies are required to report in relation to infrastructure contributions received and expended.
In addition, the MPA acts as the collecting agency for the East Werribee Employment Precinct Development Contribution Plan (EWEP DCP), and in accordance with sections 46GM and 46QD of the Planning and Environment Act 1987 the MPA is required to report annually on aspects of that DCP.  The following tables reflect the different elements to be reported annually.
Total DCP contributions received for the year ended 30 June 2016
Name of DCP	Contributions received for the year ($)	
EWEP	Nil	
Total	Nil	

DCP land, works, services or facilities accepted as works-in-kind for the year ended 30 June 2016
Name of DCP	Project description	Item purpose	Project value $	
EWEP	n/a	n/a	Nil	
Total			Nil	

Total DCP contributions received and expended for the year ended 30 June 2016
Name of DCP	Total levies received $	Total levies expended $	Total works-in-kind accepted $	Total DCP contributions received (levies and works-in-kind) $	
EWEP	Nil	Nil	Nil	Nil	
Total	Nil	Nil	Nil	Nil	

Land, works, services or facilities delivered during the year ended 30 June 2016 from DCP levies collected
Project description	Name of DCP	DCP fund 
expended during the year $	MPA’s contribution for the year $	Other contributions in the financial year $	Total project expenditure for the year $	Percentage of item delivered	
n/a	EWEP	Nil	Nil	Nil	Nil	Nil	
Total							

Water Resource Assessment Program 
Under Section 22 (1) of the Water Act 1989, the Minister for Water is required to ensure that a continuous program of assessment of the water resources of the state is undertaken. Under Section 22 (2), the water resources assessment program must provide for the collection, collation, analysis and publication of information about:
(a)	the availability of water, including surface water and groundwater
(ab)	use of one water source as a substitute for another water source
(ac)	the environmental water reserve
(b)	the disposal of wastewater (including trade waste, sewage and saline water)
(c)	the use and re-use of water resources
(d)	floodwaters
(e)	drainage and waterway management
(f)	water quality (including salinity)
(g)	in-stream uses of water
(ga)	current and historic levels of allocation and use of surface water and groundwater
(gb)	current and historic condition of waterways and aquifers
(h)	anything else that the Minister decides is appropriate.
Section 26 of the Act requires DELWP to report annually on these areas. 
DELWP provides information on Victoria’s water resources through a range of comprehensive reporting mechanisms, including the Monthly Water Report on the DELWP website, the Water Measurement Information System and Victorian Water Register websites, and the Victorian Water Accounts (VWA).  
The Victorian Water Accounts is an annual statewide summary of Victoria’s water resources, documenting water availability and providing assessments of rainfall, streamflow and groundwater levels, as well as information on water storages and reuse of treated wastewater. Information on water taken for consumptive use, as well as water set aside for environmental purposes, is provided in the context of the Victorian water allocation framework, which sets out entitlements to water. 
The VWA sources key data from the state’s surface water and groundwater monitoring networks, and draws on information from water businesses, DELWP, the Essential Services Commission, the Murray-Darling Basin Authority and catchment management authorities (CMAs). The VWA are published annually in hard copy and available online on the Victorian Water Register website  http://www.waterregister.vic.gov.au.
The Victorian Water Register is a public register of all water-related entitlements in Victoria, and is used to report on the allocation and use of the state’s water resources. The register holds water shares recorded by the Victorian Water Registrar and records of licences and delivery shares. It records water allocations and tracks and reconciles volumes of water entitlements by water system and trading zone. The Victorian Water Register website can also be used to generate statistics and reports on levels of use, directions of trade, and prices paid for water.
All water monitoring data collected by DELWP and its partners is made accessible on the Water Measurement Information System (WMIS), available at http://data.water.vic.gov.au. 
As well as these reporting tools, there are a number of processes in place to collect and provide specific information as required under the Act. These are briefly summarised below, with references to sites and resources containing further and more detailed information.
a) Availability of water 
Surface water
The state’s surface water resources assessment network includes 845 sites that were monitored in 2015-16 through three regional water monitoring partnerships. These partnerships comprise 40 public and private organisations that procure their monitoring requirements under this program. The partnerships include state government departments, water corporations, CMAs, local shires and councils, the Bureau of Meteorology and the Murray-Darling Basin Authority. 
Surface water monitoring services are procured by DELWP on behalf of the regional water monitoring partnerships to ensure efficiency and statewide consistency in data quality. 
The program delivers legislative obligations under Section 22 of the Act and Section 126 of the Commonwealth Water Act 2007 and contributes to a range of business needs across the partnership including: 
operational decision making
compliance reporting
flood warning
statewide policy development for water resources
river health management
reporting for the monthly water report, the annual water quality reports and the longer term water quality trend reports.
All surface water data collected through the partnerships, summary reports on historical longer term trends of surface water quality and the current status water quantity are available on the Water Measurement Information System and the Monthly Water Report on the DELWP website: http://www.delwp.vic.gov.au.
Groundwater
Groundwater basins and catchments are now part of Victoria’s management framework, allowing for groundwater systems to be managed as part of a broader water system. Groundwater strategies, statutory management plans and local management plans have been prepared covering almost all groundwater catchments. The strategies and plans explain the current understanding of the resource, objectives of management and the tools including caps on allocation (permissible consumptive volumes), trading rules, carryover, rules for the introduction of restrictions, metering requirements, monitoring, reporting and the plan review period. In all cases, strategies and plans are developed in consultation with local stakeholders including groundwater users, environmental representatives and relevant government departments.
In respect to use other than domestic and stock purposes, nearly all useable groundwater resources are capped for licensed use. In northern Victoria, caps are set in the Murray-Darling Basin Plan. In other parts of Victoria caps are set as permissible consumptive volumes made by the Minister for Water.  In a small number of areas groundwater is available under these caps for allocation. Rural water corporations are able to sell new licences for this groundwater. In 2015-16 new groundwater licences were sold in the west Wimmera and west Port Phillip groundwater catchments.
In most areas, where caps have been set, the water is fully allocated. This means new groundwater users must trade with an existing licence holder to obtain access. Groundwater markets in Victoria are still in the early stages of development. Productive use of the groundwater resource will support the development needed to stimulate local and regional economies. To improve opportunities for licences to be traded allowing groundwater to be put to higher value uses, statewide policies are being prepared to facilitate trade and existing management areas are being reviewed, in consultation with stakeholders, with the aim of removing barriers to trade and reducing costs. 
Victoria’s revised groundwater monitoring program involves quarterly monitoring of about 1,600 bores. Rural water corporations also conduct monthly monitoring of about 500 bores. Accurate monitoring data is crucial for sustainable management of groundwater resources and helps with the resolution of management issues, questions or disputes raised by groundwater users.
All groundwater data is available via the Water Measurement Information System. Summary reports on historical longer term trends in groundwater levels across the state are available on the DELWP website. Information on groundwater use and trends is also provided in the annual Victorian Water Accounts.
ab) Use of one water source as a substitute  for another water source
Under Ministerial Reporting Direction 03, water corporations are required to provide information in their annual reports on how they are promoting the integrated and sustainable use of water resources in their region. This includes projects undertaken in-line with targets set in the entity’s corporate plan to deliver water recycling, water conservation, sustainable and resilient water services systems and Sustainable Water Strategies. Water corporations’ annual reports are tabled in Parliament and available on water corporation websites.
 ac) Environmental water reserve 
The Environmental Water Reserve (EWR) is the legal term for water set aside for the environment under the Water Act 1989. The EWR comprises water defined by: 
entitlements for the environment that are called either environmental bulk entitlements or environmental entitlements 
the operation of caps on licensed consumptive water use (such as sustainable diversion limits or permissible consumptive volumes) and conditions on consumptive bulk entitlements, licences and permits, and as set out in management plans. 
The majority of the EWR is set aside through the latter.
In regulated systems, the EWR is established through environmental entitlements, environmental bulk entitlements and various operational conditions on consumptive water use. The environmental entitlements and environmental bulk entitlements refer to water usually held in and released from storages. They are held by the Victorian Environmental Water Holder (VEWH), the independent statutory body responsible for making decisions on the most efficient and effective use of Victoria’s environmental water entitlements. 
The VEWH includes the scope of potential watering actions for the coming year in its annual seasonal watering plan, informed by seasonal watering proposals prepared by each of the CMAs and Melbourne Water. The VEWH then commits water throughout the year via seasonal watering statements which authorise waterway managers to use environmental water.
The VEWH is established under Part 3AA of the Water Act 1989. Further details about the VEWH can be found on its website:  http://www.vewh.vic.gov.au.
Amendments were made to one environmental entitlement held by VEWH in 2015-16, the Blue Rock Environmental Entitlement 2013. The amendment was required to increase the environment’s proportional share of inflows, reflecting a decrease in the storage capacity  of Blue Rock Reservoir (which was applied  to all entitlements in the system).  At 30 June 2016, the VEWH Water Holdings comprised 22 entitlements and a number of water shares. Further information on the entitlements held by the VEWH can be found on the VEWH website: http://www.vewh.vic.gov.au.
During 2015-16, environmental water was managed to meet environmental objectives at 123 Index of Stream Condition river reaches and 76 wetlands including:
Thomson, Macalister,  Latrobe and Snowy rivers and the lower Latrobe Wetlands in Gippsland
Yarra, Tarago, Werribee and Moorabool rivers and Jacksons Creek in central Victoria
Wimmera, MacKenzie and Glenelg rivers and Burnt and Mount William creeks in western Victoria
40 wetlands in the Wimmera-Mallee wetland complex
Lower Barwon River wetlands (Hospital Swamps and Reedy Lake)
Goulburn, Campaspe and Loddon rivers, Broken and Gunbower creeks, three Broken system wetlands and two Goulburn system wetlands
Living Murray Icon sites – including Barmah Forest, Boals Deadwood, Gunbower Forest, Hattah Lakes, Lake Wallawalla, Linsday River, Mullaroo Creek, Poterwalkagee Creek and Wallpolla East
17 northern wetlands and floodplains.
Full details of 2015-16 environmental watering activities will be provided in the Reflections annual watering booklet and annual report developed by VEWH. These will be available on the VEWH website: http://www.vewh.vic.gov.au.
In unregulated rivers, the EWR is set aside either through conditions on licences and bulk entitlements, caps or through statutory water management plans and non-statutory local management plans. Water corporations are responsible for ensuring that these conditions for the EWR are met.
During 2015-16, the Victorian Government implemented improved environmental flows and management conditions in priority, flow-stressed unregulated and regulated rivers and wetlands by: 
delivering environmental water to Hattah Lakes, Gunbower Forest and Wallpolla Island using newly constructed infrastructure funded under the Living Murray program
progressing proposals for new environmental water management infrastructure at nine sites in northern Victoria under the Basin Plan’s Sustainable Diversion Limit Adjustment Mechanism, including Gunbower National Park, Guttrum and Benwell State Forests, Burra Creek, Nyah Park, Vinifera Park, Belsar-Yungera Island, Hattah Lakes North, Wallpolla Island and Lindsay Island
investigating options to ease environmental water delivery constraints in the Goulburn River and along the Murray River
completing four environmental water management plans for rivers in southern Victoria
implementing Chapter 8 of the Murray-Darling Basin Plan (Basin Plan Environmental Watering Plan), including development of annual watering priorities and completion of three long-term environmental watering plans. 
b) Disposal of wastewater (including trade waste, sewage and saline water) 
All water corporations (urban) are required to report on wastewater disposals, as part of the report of operations in their annual reports. The performance report includes indicators related to financial, service delivery and environmental performance. Specific wastewater indicators are prepared for reliability of collection services, quality of disposal and management. The annual reports are tabled in Parliament.
c) Use and re-use of water resources
See section ab) above, ‘The use of one water source as a substitute for another water source’. All urban water corporations are required to report on total use of alternative water sources such as recycled wastewater and stormwater reuse as part of the report of operations in their annual reports. The performance report includes indicators related to environmental performance for effluent re-use and greenhouse gas emissions. The annual reports are tabled in Parliament and available on water corporation websites.
d) Floodwaters 
DELWP is the lead agency for coordination of floodplain management in Victoria.
The Victorian Floodplain Management Strategy was released in April 2016 to help communities be better prepared for future floods. The strategy clarifies the roles and responsibilities of government agencies and authorities involved in flood management. It aims to improve the evaluation and communication of flood risks so communities and relevant agencies can take better-informed action to manage floods. The strategy supports priorities being developed at a regional level in consultation with local communities. The Victorian Floodplain Management Strategy is available on the DELWP website.
DELWP assists CMAs and municipalities to improve their knowledge of areas of flood risk and ensure that new development is compatible with the flood risk.  Some 18 local flood risk studies and flood mitigation investigations are underway across regional Victoria, led by CMAs and local governments. These flood risk assessments explore measures to reduce flood risks. Five regional flood mapping projects were completed to support land-use planning, community awareness and flood emergency planning.
FloodZoom – Flood intelligence platform was launched in August 2015, and won a global Special Achievement Award for Geographic Information Systems.  It is now in use with other systems to assist flood response and community flood advice.
e) Drainage and waterway management
DELWP oversees the Victorian Waterway Management Program that aims to maintain or improve the condition of Victoria’s rivers, estuaries and wetlands. The program is a partnership between state government, regional agencies and authorities, other management partners (such as Traditional Owners) and local communities. 
As part of the program, DELWP is responsible for establishing the state policy framework for waterway management. Regional implementation is led by waterway managers from the CMAs, and Melbourne Water in Port Phillip and Westernport.
Funding provided by the Victorian Government in 2015-16 into improving the health of Victoria’s waterways has been invested by CMAs according to agreed works programs. The delivery of projects and services through these works programs is tracked and reported annually. 
A comprehensive report card assessing progress against statewide waterway health targets was last published by the Department in 2009, with the next progress report planned for 2017.
Major drainage systems in the Melbourne region are the responsibility of Melbourne Water, managed under their Waterways and Drainage Strategy, and reported against in the Melbourne Water Annual Report.
f) Water quality (including salinity) 
Water quality monitoring was conducted at 387 partnership sites across the state in 2015-16. A range of water quality parameters are either continuously monitored or sampled at regular intervals from these sites, and cover a range of physical, chemical, nutrient, metal, anion, cation, organic load and algal analyses. Data from the monitoring network is made publicly available through the Water Measurement Information System.
g) In-stream uses of water
Refer to section ac) above, ‘Environmental Water Reserve’, for details regarding the in-stream use of water.
ga) Current and historic levels of allocation and use of surface water and groundwater 
The Victorian Water Accounts provide an annual overview of water availability and use across Victoria at bulk supply level, including a detailed water account for each of Victoria’s 29 river basins, along with distribution system water accounts for each of the 19 water corporations in Victoria. The basin accounts include quantitative data and commentary on available water and water use, while the distribution system water accounts comprise water balances for urban, rural and wholesale water distribution systems. Because distribution system boundaries are not necessarily aligned with river basin boundaries, the distribution system water balances are reported by the Northern, Gippsland, Central and Western regions. 
The 2015-16 accounts are due to be completed in the first half of 2017, and will be published on the Victorian Water Register website. Comprehensive historic information on allocations and water use is also available in Water Accounts and State Water Reports dating back to 2003-04. 

Surface water
The availability of surface water was below average in 2015-16 with below average rainfall and reduced streamflow volumes across  most of the state. Seasonal allocations for  high reliability water shares reached  100 per cent in the Murray system and the Macalister Irrigation District, but did not reach 100 per cent in any other system. Seasonal allocations for low reliability water shares reached 20 per cent in the Macalister Irrigation District, with no allocations for low reliability water shares in other systems.  
Surface water use in Victoria’s regulated systems (systems that have water shares) totalled 2654.7 gigalitres (GL) in 2015-16. Of this the majority, approximately 73 per cent, was used for irrigation, while about 2-3 per cent was used by urban customers and about 25 per cent was used by the environment. 
Groundwater
Seasonal allocations are announced in accordance with the groundwater management plans developed for Water Supply Protection Areas (WSPAs) and Groundwater Management Areas (GMAs). An allocation of less than  100 per cent of the licensed entitlement may be put in place to reduce the risks from falling groundwater levels; allow the resource to be shared between all users; or recognise and reduce the social and environmental costs  of lowering groundwater levels.
In 2015–16, restrictions on groundwater use were in place in the Katunga WSPA (70 per cent in all zones), West Wimmera Neuarpur sub-zone 1  (80 per cent), Loddon Highlands WSPA Newlyn Zone (70 per cent) and Werribee WSPA  (50 per cent).
gb) Current and historic condition of waterways and aquifers 
Waterway condition in Victoria is measured using a number of integrated monitoring tools known as the Index of Stream Condition (ISC) and the Index of Wetland Condition (IWC). These assessments are carried out every eight years and they measure statewide condition and the long-term effectiveness of the river health rehabilitation programs. 
The results of the third and most recent ISC assessment were released during 2013 and are available at the Index of Condition System (ICS): http://ics.water.vic.gov.au. The results from the first statewide wetland assessment that looked at 827 wetlands are also available at:  http://ics.water.vic.gov.au. 
Sustainable Water Strategies 
Regional Sustainable Water Strategies (SWSs) are a legislative requirement under Division 1B of the Water Act 1989 and fulfil Victoria’s commitment under the National Water Initiative to carry out open, statutory-based water planning. Four SWSs covering the state were produced between 2006 and 2011. These strategies set out long-term plans to secure each region’s water future, identifying threats to water supply and quality in the region and identifying policies and actions to help water users, water corporations and catchment management authorities manage and respond to those threats over the next 50 years. 
The first strategies completed were the Central Region SWS in 2006 and the Northern Region SWS in 2009. The Gippsland Region SWS and the Western Region SWS were completed in November 2011.
A total of 300 actions were identified in the four SWSs to enable the objectives of each strategy to be achieved.  Implementation of actions was largely the responsibility of DELWP, water corporations, catchment management authorities, DEDJTR and partners and stakeholders.
A recent stocktake of SWS actions has identified that of these 300 actions, 244 are now complete. 
Key areas of achievement for implemented actions include:
improved approaches to groundwater management
water conservation programs for homes, schools and communities
infrastructure construction and/or upgrade
water cycle management and resource planning
environmental water recovery and management
improved water markets
Victorian and regional water management strategies development.
Of the remaining actions, many have been partly implemented. However, due to subsequent changes in climatic conditions or policy and legislative settings, some actions or residual components of actions may no longer be appropriate or relevant. These unresolved actions will be subject to a comprehensive review process.
Each SWS is required to be reviewed and renewed ten years after its release. The first of these reviews, for the Central Region SWS, is due to be undertaken in 2016-17. This review, in conjunction with the Victorian Water Plan implementation process, will consider all residual SWS actions in the context of statewide policy and planning implications. Actions still requiring implementation will be identified, reviewed and further action determined and planned for through this process. 
More information on the SWSs and further details on the status of each individual SWS action are available on the DELWP website.
Additional information available on request
In compliance with the requirements of the Standing Directions of the Minister for Finance, details in respect of the items listed below have been retained by the Department and are available on request, subject to the provisions of the Freedom of Information Act 1982.
a)	A statement that declarations of pecuniary interests have been duly completed by all relevant officers of the department.
b)	Details of shares held by senior officers as nominee or held beneficially in a statutory authority or subsidiary.
c)	Details of publications produced by the department about the activities of the department and where they can be obtained.
d)	Details of changes in prices, fees, charges, rates and levies charged by the department for its services, including services that are administered.
e)	Details of any major external reviews carried out in respect of the operation of the department.
f)	Details of any other research and development activities undertaken by the department that are not otherwise covered either in the report of operations or in a document which contains the financial statement and report of operations.
g)	Details of overseas visits undertaken including a summary of the objectives and outcomes of each visit.
h)	Details of major promotional, public relations and marketing activities undertaken by the department to develop community awareness of the services provided by the department.
i)	Details of assessments and measures undertaken to improve the occupational health and safety of employees, not otherwise detailed in the report of operations.
j)	A general statement on industrial relations within the department and details of time lost through industrial accidents and disputes, which are not otherwise detailed in the report of operations.
k)	A list of major committees sponsored by the department, the purposes of each committee and the extent to which the purposes have been achieved.
l)	Details of all consultancies and contractors including:
(i)	consultants/contractors engaged
(ii)	services provided
(iii)	expenditure committed to for each engagement.
To ensure the department is meeting its accountability and compliance requirements, some of this additional information has been included in the Annual Report, where relevant.
The information is available on request from:
Phuong Tram 
Director, Budget and Planning,  Finance and Planning
Department of Environment, Land,  Water and Planning 
8 Nicholson Street  East Melbourne Victoria 3002 
Telephone: (03) 9637 8886 
Email: phuong.tram@delwp.vic.gov.au
Department of Environment, Land, Water and Planning
Financial Statements 30 June 2016

Contents	Page
Accountable Officer’s and Chief Finance and Accounting Officer’s declaration	97
Victorian Auditor General’s Office Independent Auditor’s Report	98
Comprehensive operating statement	99
Balance sheet	100
Statement of changes in equity	101
Cash flow statement	102
Notes to the financial statements	103
These financial statements cover the Department of Environment, Land, Water and Planning as an individual  entity and are presented in the Australian currency.
The Department of Environment, Land, Water and Planning  is a Government department of the State of Victoria.   Its principal address is:
Department of Environment, Land, Water and Planning
8 Nicholson Street
East Melbourne Victoria 3002
A description of the nature of the department’s operations and its principal activities is included in the Report of Operations.
These financial statements were authorised for issue by  the Secretary – Mr Adam Fennessy and the Executive  Director Finance and Planning – Ms Carolyn Jackson on  12 September 2016.
For queries in relation to our financial reporting please call  13 61 86, or visit our website (www.delwp.vic.gov.au).
Comprehensive operating statement for the financial year ended 30 June 2016
	Notes	2016 $’000	2015 $’000	
Income from transactions				
Output appropriations	1(f), 26	1,164,409	1,225,193	
Special appropriations	1(f), 26	58,746	115,422	
Interest 	1(f), 4(a)	19,067	6,867	
Sale of goods and services	1(f), 4(b)	70,071	78,495	
Municipal and Industrial Landfill Levy	1(f), 4(c)	201,170	0	
Metropolitan Parks Improvement Rate	1(f), 4(d)	159,537	152,564	
Grants	1(f), 4(e)	13,562	212,999	
Fair value of assets and services received free of charge or for nominal consideration	1(f), 4(f)	   5	  64	
Other income	1(f), 4(g)	2,252	11,341	
Total income from transactions		1,688,819	1,802,945	
Expenses from transactions				
Employee expenses	1(g), 5(a)	(363,675) 	(369,741)	
Depreciation	1(g), 5(b)	(41,433) 	(56,759)	
Interest expense	1(g), 5(c)	(982)	(11,994) 	
Grants and other transfers	1(g), 5(d)	(633,604) 	(461,437)	
Capital asset charge	1(g)	(91,342)	(102,392)	
Supplies and services	1(g), 5(e)	(524,085)	(470,478)	
Other operating expenses	1(g), 5(f)	(12,647)	(6,610)	
Total expenses from transactions		(1,667,768)	(1,479,411)	
Net result from transactions (net operating balance) 		21,020	323,534	
Other economic flows included in net result				
Net gain/(loss) on non–financial assets	1(h), 6(a)	(50,973)	7,370	
Net gain/(loss) on financial instruments 	1(h), 6(b)	2,711	(36)	
Share of net losses of associates, excluding dividends	1(h), 6(c)	(4,377)	(2,985)	
Other losses from other economic flows	1(h), 6(d)	(2,144)	(1,330)	
Total other economic flows included in net result		(54,783)	3,019	
Net result 		(33,732)	326,553	
Other economic flows – other comprehensive income				
Items that will not be classified to net result				
Changes in physical asset revaluation surplus	25	969,019	111,647	
Share of change in associate’s contributed capital	9	8,548	155	
Total other economic flows – other comprehensive income		977,567	111,802	
Comprehensive result 		943,835	438,355	

The comprehensive operating statement should be read in conjunction with the notes to the financial statements.
Balance sheet as at 30 June 2016
	Notes	2016 $’000	2015 $’000	
Assets				
Financial assets				
Cash and deposits	1(k), 24(a)	553,410	587,537	
Receivables	1(k), 7	303,235	265,470	
Investments and other financial assets	1(k), 8	510,300	20,100	
Investments accounted for using the equity method	1(k), 9	11,349	9,199	
Total financial assets		1,378,294	882,306	
Non-financial assets				
Inventories	1(l), 11	21,033	18,817	
Non-financial physical assets classified as held for sale	1(l), 12	8,320	2,273	
Property, plant and equipment	1(l), 13	8,371,139	7,573,395	
Biological assets	14	   0	0	
Intangible assets	1(l), 15	29,373	27,042	
Prepayments	1(l)	9,367	77,764	
Total non-financial assets		8,439,232	7,699,291	
Total assets		9,817,526	8,581,597	
Liabilities				
Payables	1(m), 16	112,003	126,946	
Borrowings	1(m), 17	32,719	28,871	
Unearned income	1(m)	2,196	2,254	
Deposits repayable	1(m)	  13	31	
Provisions	1(m), 18	136,685	137,756	
Total liabilities		283,616	295,858	
Net assets		9,535,910	8,285,739	
Equity				
Accumulated surplus		275,469	309,201	
Share of associate's contributed capital		8,703	155	
Physical asset revaluation surplus	25	6,731,484	5,762,465	
Contributed capital	1(o)	2,518,254	2,213,918	
Net worth		9,533,910                                                                                                                                            	8,285,739	
				
Commitments for expenditure	1(p), 21			
Contingent assets and contingent liabilities	1(q), 22			

The balance sheet should be read in conjunction with the notes to the financial statements.

Statement of changes in equity for the financial year ended 30 June 2016
	Notes	Accumulated surplus/ (deficit) $’000	Share of associate’s contributed capital $’000	Physical asset revaluation surplus $’000	Contributions by owner $’000	Total $’000	
Balance at 1 July 2014		(17,352)	0	5,650,818	2,376,037	8,009,503	
Net result for the year 		326,553	0	0	0	326,553	
Other comprehensive income for the year 	25	0	155	111,647	0	111,802	
Capital appropriations	26(c)	0	0	0	110,663	110,663	
Capital contributions of non-financial assets		0	0	0	(16,953)	(16,953)	
Administrative restructure – net assets received	33	0	0	0	293,927	293,927	
Administrative restructure – net assets transferred	33	0	0	0	(474,415)	(474,415)	
Net capital contributions transferred to portfolio entities 		0	0	0	(75,341)	(75,341)	
Balance at 30 June 2015		309,201	 155	5,762,465	2,213,918	8,285,739	
Net result for the year		(33,732)	0	0	0	(33,732)	
Other comprehensive income for the year	8, 25	0	8,548	969,019	0	977,567	
Capital appropriations	26(c)	0	0	0	68,197	68,197	
Capital contributions of assets		0	0	0	294,001	294,001	
Net capital contributions transferred to portfolio entities		0	0	0	(57,862)	(57,862)	
Balance at 30 June 2016		275,469	8,703	6,731,484	2,518,254	9,533,910 	

The statement of changes in equity should be read in conjunction with the notes to the financial statements.

Cash flow statement for the financial year ended 30 June 2016
	Notes	2016 $’000	2015 $’000	
Cash flows from operating activities				
Receipts				
Receipts from government		1,293,662	1,628,439	
Receipts from other entities		389,236	238,036	
Goods and Services Tax recovered from the ATO (i)		49,123	42,435	
Interest received		11,530	5,626	
Total receipts		1,743,551	1,914,536	
Payments				
Payments of grants and other transfers		(623,018)	(484,146)	
Payments to suppliers and employees		(888,118)	(1,004,555)	
Capital asset charge payments		(91,342)	(102,392)	
Interest and other costs of finance paid		(1,016)	(12,008)	
Total payments		(1,603,494)	(1,603,101)	
Net cash flows from operating activities	24(c)	140,057	311,435	
Cash flows used in investing activities				
Payments for investments		(106,436)	(14,092)	
Payments to joint operations		   0	(1,301)	
Purchases of non-financial assets		(58,171)	(111,323)	
Sales of non-financial assets		 211	24,527	
Net cash flows used in investing activities		(164,396)	(102,189)	
Cash flows from/(used in) financing activities				
Cash received from activity transferred in – MoG changes	33	0	80,451	
Cash transferred on activity transferred out – MoG changes	33	   0	(52,164)	
Owner contributions by State Government	26(c)	68,197	110,663	
Payments of capital contributions		(57,862)	(75,341)	
Repayments of finance leases		(2,989)	(5,381)	
Proceeds from/(repayments of) advances		(17,134)	2,234	
Net cash flows from/(used in) financing activities		(9,788)	60,462	
Net increase/(decrease) in cash and cash equivalents		(34,127)	269,708	
Cash and cash equivalents at the beginning of the financial year		587,537	317,829	
Cash and cash equivalents at the end of the financial year	24(a)	553,410	587,537	

Non-cash financing and investing activities are disclosed in Note 24(b).
The cash flow statement should be read in conjunction with the accompanying notes.
Note:
(i) Goods and Services Tax recovered from the ATO is presented on a net basis.

Contents	Page
Note 1. Summary of significant accounting policies 	104
Note 2. Departmental (controlled) outputs	127
Note 3. Administered (non-controlled) items	138
Note 4. Income from transactions	153
Note 5. Expenses from transactions	154
Note 6. Other economic flows included in net result	156
Note 7. Receivables	157
Note 8. Investments and other financial assets	159
Note 9. Investments accounted for using the equity method	160
Note 10. Investments in joint operations	162
Note 11. Inventories	164
Note 12. Non-financial physical assets classified as held for sale	165
Note 13. Property, plant and equipment	166
Note 14. Biological assets	177
Note 15. Intangible assets	178
Note 16. Payables	179
Note 17. Borrowings	180
Note 18. Provisions	181
Note 19. Superannuation	184
Note 20. Leases	185
Note 21. Commitments for expenditure	187
Note 22. Contingent assets and contingent liabilities	189
Note 23. Financial instruments 	190
Note 24. Cash flow information	201
Note 25. Reserves	202
Note 26. Summary of compliance with annual parliamentary and special appropriations	203
Note 27. Ex-gratia payments	205
Note 28. Annotated income agreements	206
Note 29. Trust account balances	208
Note 30. Responsible persons	217
Note 31. Remuneration of executives and payments to other personnel	218
Note 32. Remuneration of auditors	219
Note 33. Restructure of administrative arrangements	220
Note 34. Subsequent events	223
Note 35. Glossary of terms and style conventions 	224

Note 1. Summary of significant accounting policies 
These annual financial statements represent the audited general purpose financial statements for the Department of Environment, Land, Water and Planning (the department) for the period ended 30 June 2016.
The report provides users with information about the department’s stewardship of resources entrusted to it.
(a) Statement of compliance
These general purpose financial statements have been prepared in accordance with the Financial Management Act 1994 (FMA) and applicable Australian Accounting Standards (AAS) which include Interpretations, issued by the Australian Accounting Standards Board (AASB). In particular, they are presented in a manner consistent with the requirements of AASB 1049 Whole of Government and General Government Sector Financial Reporting.
Where appropriate, those AAS paragraphs applicable to not-for-profit entities have been applied.
Accounting policies are selected and applied in a manner which ensures that the resulting financial information satisfies the concepts of relevance and reliability, thereby ensuring that the substance of the underlying transactions or other events is reported.
To gain a better understanding of the terminology used in these financial statements, please refer to Note 35. Glossary of terms and style conventions.
These annual financial statements were authorised for issue by the Executive Director Finance and Planning and the Secretary of the department on 12 September 2016.
(b) Basis of accounting preparation and measurement
The accrual basis of accounting has been applied in the preparation of these financial statements whereby assets, liabilities, equity, income and expenses are recognised in the reporting period to which they relate, regardless of when cash is received or paid.
Judgements, estimates and assumptions are required to be made about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on professional judgements derived from historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.
The judgement and assumptions used to determine the type of joint arrangement in which the department had an interest during the reporting period are disclosed in Note 3. Administered (non-controlled) items, Note 9. Investments accounted for using the equity method and Note 10. Investments in joint operations.
Revisions to accounting estimates are recognised in the period in which the estimate is revised and also in future periods that are affected by the revision. Judgements and assumptions made by management in the application of AASs that have significant effects on the financial statements and estimates relate to:
the fair value of land, buildings, infrastructure, plant and equipment (refer to Note 1(l) Non-financial assets);
the impairment of non-financial assets (refer to Note 1(h) Other economic flows included in the net result);
the estimated useful lives over which non-financial assets are depreciated;
the estimation of amounts required to be provisioned or disclosed as contingent liabilities; and
assumptions for employee benefit provisions based on likely tenure of existing staff, patterns of leave claims, future salary movements and future discount rates (refer to Note 1(m) Liabilities).
These financial statements are presented in Australian dollars, and have been prepared in accordance with the historical cost convention, except for:
non financial physical assets which, subsequent to acquisition, are measured at a revalued amount being their fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent impairment losses. Revaluations are made with sufficient regularity to ensure that the carrying amounts do not materially differ from their fair value; and 
the fair value of any other asset is generally based on its depreciated replacement value. 
Consistent with AASB 13 Fair Value Measurement, the department determines the policies and procedures for both recurring fair value measurements such as property, plant and equipment and financial instruments and for non-recurring fair value measurements such as non-financial physical assets classified as held for sale, in accordance with the requirements of AASB 13 and the relevant Financial Reporting Directions.
All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:  
Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities 
Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.
For the purpose of fair value disclosures, the department has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.
In addition, the department determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.
The Valuer-General Victoria (VGV) is the department’s independent valuation agency. 
The department, in conjunction with VGV, monitors changes in the fair value of each asset through relevant data sources to determine whether revaluation is required.
A fair value assessment is conducted annually to ensure that property, plant and equipment reflects the fair value at the end of the year. The assessment considers all fair value indicators, including land and building indices, the highest and best use indicators and other relevant indicators. 
In the event that the assessment triggers a change in value, adjustments are made to reflect the fair value of the asset.   
In accordance with the requirements of Financial Reporting Direction (FRD) 103F, the department has revalued its property, plant and equipment under the Public Safety and Environment Purpose Group at 30 June 2016. Refer to Note 13 Property, Plant and Equipment for more information.  
(c) Reporting entity 
The financial statements cover the department as an individual reporting entity.
The department is a government department of the State of Victoria (the State), established pursuant to an order made by the Premier under the Administrative Arrangements Act 1983.
Its principal address is:
Department of Environment, Land, Water and Planning
8 Nicholson Street 
East Melbourne Victoria 3002
The department is an administrative agency acting on behalf of the Crown.
The financial statements include all the controlled activities of the department.
The following administrative office of the department, for the purpose of this report, is included in the reporting entity:
Local Government Investigations and Compliance Inspectorate (LGICI) is an administrative office established under section 11 of the Public Administration Act 2004. LGICI was established to assess compliance with the Local Government Act 1989. 
The following statutory bodies are excluded from the department’s reporting entity:
The Commissioner for Environmental Sustainability was established by the Victorian Government in November 2003 under the Commissioner for Environmental Sustainability Act 2003 to provide an independent voice that audits and reports on environmental sustainability. The Commissioner for Environmental Sustainability is designated as a separate reporting entity and is excluded from the department’s financial report.
The Victorian Environmental Water Holder was established by the Victorian Government in July 2011 under the Water Amendment (Victorian Environmental Water Holder) Act 2010 to manage the state’s environmental water holdings. The Victorian Environmental Water Holder is designated as a separate reporting entity and is excluded from the department’s financial report.
The Alpine Resorts Co-ordinating Council was established by the Victorian Government in October 1998 under the Alpine Resorts (Management) Act 1997 to address issues of broad concern to alpine resort stakeholders and government. The Council is designated as a separate reporting entity and is excluded from the department’s financial report.
The Heritage Council was established by the Victorian Government in 1995 under the Heritage Act 1995 to identify and protect places and objects of cultural and heritage significance to the State of Victoria. The Council is designated as a separate reporting entity and is excluded from the department’s financial report. The Council transferred to the department on 1 January 2015 as a consequence of the Machinery of Government administrative changes announced on 4 December 2014.
The Yorta Yorta Traditional Owner Land Management Board was established by the Victorian Government on 11 July 2013 under the Conservation, Forests and Lands Act 1987 to manage the Barmah National Park. The Board is designated as a separate reporting entity and is excluded from the department’s financial report.
The Dhelkunya Dja Land Management Board was established by the Victorian Government on 17 July 2014 under the Conservation, Forests and Lands Act 1987 to jointly manage a number of parks and reserves in central Victoria. The Board is designated as a separate reporting entity and is excluded from the department’s financial report.
A description of the nature of the department’s operations and its principal activities is included in the report of operations in the Annual Report which does not form part of these financial statements.
Objectives and funding
The department’s objective is to create liveable, inclusive and sustainable communities and thriving natural environments. It will do this by connecting metropolitan and regional community priorities and services to planning at the state level for Victoria’s growth and development. At the same time, the department focuses on caring for and protecting the environment and helping to respond to climate change through risk mitigation and adaptation strategies. These approaches will help protect, enhance and strengthen the resilience of our quality built and natural environments, assets and resources.  
The department is predominantly funded by accrual based parliamentary appropriations for the provision of outputs that are further described in Note 2. Departmental (controlled) outputs. It provides, on a fee for service basis, various goods and services.
Outputs of the department 
Information about the department’s output activities, and the income, expenses, assets and liabilities which are reliably attributable to those output activities is set out in the output activities schedule (Note 2. Departmental (controlled) outputs). Information about income, expenses, assets and liabilities administered by the department are given in the schedule of administered income and expenses and the schedule of administered assets and liabilities (Note 3. Administered (non-controlled) items).
(d) Basis of consolidation
Consolidated financial statements have not been prepared as the department does not control any other entities under AASB 10 Consolidated Financial Statements.
Administered items
Certain resources are administered by the department on behalf of the state. While the department is accountable for the transactions involving administered items, it does not have the discretion to deploy the resources for its own benefit or the achievement of its objectives. Accordingly, transactions and balances relating to administered items are not recognised as departmental income, expenses, assets or liabilities within the body of the financial statements.
The department is administering the desalination plant arrangements on behalf of the state and therefore recognises the associated income, expenses, assets, liabilities and off balance sheet disclosures as administered items.
Other administered items include fees from land title transactions, environmental contributions from Victorian water businesses, the state’s share of the Murray-Darling Basin Authority’s jointly controlled assets, proceeds from the sale of administered surplus land and buildings, and grants provided by the Commonwealth to assist the State Government in meeting general or specific delivery obligations. 
Except as otherwise disclosed, administered resources are accounted for on an accrual basis using the same accounting policies adopted for recognition of the departmental items in the financial statements. Both controlled and administered items of the department are consolidated into the financial statements of the state.
Disclosures related to administered items can be found in Note 3. Administered (non-controlled) items.
Funds held in trust
The department receives monies in a trustee capacity for various purposes and holds it in a number of trust accounts.
Trust accounts where the department has discretion to deploy the resources for its own benefit or the achievement of its objectives are controlled trust accounts. Controlled trust accounts are recognised in these financial statements.
Trust accounts where the department does not have the discretion to deploy the resources for its own benefit or the achievement of its objectives are administered trust accounts. These transactions and balances are reported in Note 3. Administered (non-controlled) items.
The department does not hold any trust accounts on behalf of third parties external to the Victorian Government.
Disclosures related to trust account transactions and balances can be found in Note 29. Trust account balances.
(e) Scope and presentation of financial statements
Comprehensive operating statement
The comprehensive operating statement comprises three components, being ‘net result from transactions’, ‘other economic flows included in net result’, as well as ‘other economic flows – other comprehensive income’. The sum of the former two represents the net result. 
The net result is equivalent to profit or loss derived in accordance with AASs. 
This classification is consistent with the whole-of-government reporting format and is allowed under AASB 101 Presentation of Financial Statements.
Refer to Note 35. Glossary of terms and style conventions for the definition of ‘net result from transactions’, ‘other economic flows included in net result’ and ‘other economic flows – other comprehensive income’. 
Balance sheet
Assets and liabilities are presented in liquidity order with assets aggregated into financial assets and non-financial assets.
Current and non-current assets and liabilities are disclosed in the notes, where relevant. In general, non-current assets or liabilities are expected to be recovered or settled more than 12 months after the reporting period, except for the provisions of employee benefits, which are classified as current liabilities if the department does not have the unconditional right to defer the settlement of the liabilities within 12 months after the end of the reporting period.
Statement of changes in equity
The statement of changes in equity presents reconciliations of non-owner and owner changes in equity from the opening balance at the beginning of the reporting period to the closing balance at the end of the reporting period. It also shows separately changes due to amounts recognised in the ‘Comprehensive result’ and amounts related to ‘Transactions with owner in its capacity as owner’.
Cash flow statement
Cash flows are classified according to whether or not they arise from operating, investing or financing activities. This classification is consistent with requirements under AASB 107 Statement of Cash Flows.
Rounding
Amounts in the financial statements have been rounded to the nearest $1,000, unless otherwise stated. Please refer to the end of Note 35. Glossary of terms and style conventions for a style convention explaining that minor discrepancies in totals of tables are due to rounding.
(f) Income from transactions
Income is recognised to the extent that it is probable that the economic benefits will flow to the department and the income can be reliably measured at fair value.
Appropriation income
Appropriated income becomes controlled and is recognised by the department when it is appropriated from the Consolidated Fund by the Victorian Parliament and applied to the purposes defined under the relevant appropriations act. Additionally, the department is permitted under section 29 of the Financial Management Act 1994 (FMA) to have certain income annotated to the annual appropriation. The income which forms part of a section 29 agreement is recognised by the department and the receipts paid into the Consolidated Fund as an administered item. At the point of income recognition, section 29 provides for an equivalent amount to be added to the annual appropriation. Examples of receipts which can form part of a section 29 agreement are Commonwealth specific purpose grants, municipal council special purpose grants and the proceeds from the sale of assets.
Where applicable, amounts disclosed as income are net of returns, allowances, duties and taxes. All amounts of income over which the department does not have control are disclosed as administered income in the schedule of administered income and expenses (see Note 3. Administered (non-controlled) items). Income is recognised for each of the department’s major activities as follows:
Output appropriations
Income from the outputs the department provides to the government is recognised when those outputs have been delivered and the relevant minister has certified delivery of those outputs in accordance with specified performance criteria.
Special appropriations
Under section 28 of the FMA, income is recognised when the amount appropriated for that purpose is due and payable by the department.
Interest
Interest income includes interest received on bank term deposits and other investments and the unwinding over time of the discount on financial assets. Interest income is recognised using the effective interest method which allocates the interest over the relevant period.
Net realised and unrealised gains and losses on the revaluation of investments do not form part of income from transactions, but are reported either as part of income from other economic flows in the net result or as unrealised gains or losses taken directly to equity, forming part of the total change in net worth in the comprehensive result.
Sale of goods and services
Income from the supply of services
Income from the supply of services is recognised by reference to the stage of completion of the services being performed. The income is recognised when:
the amount of the income, stage of completion and transaction costs incurred can be reliably measured; and
it is probable that the economic benefits associated with the transaction will flow to the department.
Under the stage of completion method, income is recognised by reference to the successful completion of milestones in individual contracts in each annual reporting period.
In the event that funds are received in advance and the provision of services is incomplete at the reporting date, the value of the incomplete portion is recognised as unearned income for the period and classified as a liability (refer to Note 1(m) Unearned income).
Income from the sale of goods
Income from the sale of goods is recognised when:
the department no longer has any of the significant risks and rewards of ownership of the goods transferred to the buyer;
the department no longer has continuing managerial involvement to the degree usually associated with ownership, nor effective control over the goods sold;
the amount of income, and the costs incurred or to be incurred in respect of the transactions, can be reliably measured; and
it is probable that the economic benefits associated with the transaction will flow to the department.
Sale of goods and services includes regulatory fees which are recognised at the time the regulatory fee is billed. 
Municipal and Industrial Landfill Levy
Municipal and Industrial Landfill Levies are recognised on an accrual basis in accordance with AASB 118. Levies received during the year are recorded against the year the revenue was earned. Levies for which land fill operators have not submitted returns at the end of the financial year are recorded as a receivable from the Environmental Protection Authority.
Metropolitan Parks Improvement Rate
In accordance with AASB 1004 the Metropolitan Parks Improvement Rate is recognised as income when it is received. 

Grants
Income from grants (other than contributions by owners) is recognised when the department obtains control over the contribution.
Where such grants are payable into the Consolidated Fund, they are reported as administered income (refer to Note 1(d) Basis of consolidation and Note 1(i) Administered income). For reciprocal grants (i.e. equal value is given back by the department to the provider), the department is deemed to have assumed control when the department has satisfied its performance obligations under the terms of the grant. For non-reciprocal grants, the department is deemed to have assumed control when the grant is receivable or received. Conditional grants may be reciprocal or non-reciprocal depending on the terms of the grant.
Grants payable by the Commonwealth Government are recognised as income when the department gains control over the contribution. Where such grants are payable into the Consolidated Fund, they are reported as administered income. For reciprocal grants, the department is deemed to have assumed control when it has satisfied its performance obligations under the grants. For non-reciprocal grants, the department is deemed to have assumed control when the grant is receivable or received. Conditional grants may be reciprocal or non-reciprocal depending on the terms of the grant.                                                                      
Fair value of assets and services received free of charge or for nominal consideration
Contributions of resources received free of charge or for nominal consideration are recognised at fair value when control is obtained over them, irrespective of whether these contributions are subject to restrictions or conditions over their use.
Other income
Other income
Other income includes non-property rental, forgiveness of liabilities and bad debt reversals.
The department does not recognise dividends received or receivable from its associates as income. Instead, dividends from associates are adjusted directly against the carrying amount of the investments using the equity method (refer to Note 1(k) Financial Assets).

(g) Expenses from transactions
Expenses from transactions are recognised as they are incurred, and reported in the financial year to which they relate.
Employee expenses
Refer to the section in Note 1(m) regarding employee benefits.
These expenses include all forms of consideration (other than superannuation which is accounted for separately) given by the department in exchange for services rendered by employees or for the termination of employment. This includes wages and salaries, fringe benefits tax, leave entitlements, termination payments and WorkCover premiums.
Superannuation 
The amount recognised in the comprehensive operating statement is the employer contributions for members of both defined benefit and defined contribution superannuation plans that are paid or payable during the reporting period.
The Department of Treasury and Finance (DTF) in their Annual Financial Statements, disclose on behalf of the state as the sponsoring employer, the net defined benefit cost related to the members of these plans as an administered liability. Refer to DTF’s Annual Financial Statements for more detailed disclosures in relation to these plans.
Depreciation
All items of property, plant and equipment that have finite useful lives are depreciated. Depreciation is calculated on a straight-line basis, at rates that allocate the asset’s value, less any estimated residual value, over its estimated useful life.
The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period, and adjustments made where appropriate.
The following estimated useful lives for the different asset classes are used in the calculation of depreciation: 

Asset class		Useful life
	
Buildings and structures	5 to 100 years	
Roads	80 years	
Plant and equipment	3 to 42 years	
Historic and cultural assets	99 years	
Building leasehold improvements	Term of lease  (1 to 15 years)	
Finance leased motor vehicle assets	Term of lease  (1 to 15 years)	
Intangible assets	3 to 10 years	

Where assets have separately identifiable components, those components are assigned useful lives distinct from the item of plant and equipment to which they relate and are depreciated accordingly.
Intangible produced assets with finite useful lives are depreciated as an expense from transactions on a systematic straight line basis over the asset’s useful life. Depreciation begins when the asset is available for use, that is, when it is in the location and condition necessary for it to be capable of operating in the manner intended by management.
On the other hand, the consumption of intangible non produced assets with finite useful lives is not classified as a transaction, but as depreciation. 
All intangible assets with indefinite useful lives are not depreciated or amortised, but are tested for impairment by comparing their recoverable amount with their carrying amount:
annually; and
whenever there is an indication that the intangible asset may be impaired (refer to Note 1(h)).
Interest expense
Interest expense represents costs incurred in connection with borrowings. It includes interest components of finance lease repayments, and amortisation of discounts in relation to borrowings.
Interest expense is recognised in the period in which it is incurred. Refer to Note 35. Glossary of terms and style conventions for an explanation of interest expense.

Grants and other transfers
Grants and other transfers (other than contributions to owners) are recognised as an expense in the reporting period in which they are paid or payable. They include transactions such as: grants, subsidies, other transfer payments made to state-owned agencies, local government and community groups. Refer to Note 35. Glossary of terms and style conventions for an explanation of grants and other transfers.
Capital asset charge 
A charge levied on the written-down value of controlled non-current physical assets in a department’s balance sheet which aims to: attribute to agency outputs the opportunity cost of capital used in service delivery; and provide incentives to departments to identify and dispose of underutilised or surplus assets in a timely manner. The capital asset charge is calculated on the budgeted carrying amount of applicable non-financial physical assets.
Supplies and services
Supplies and services are recognised as an expense in the reporting period in which they are incurred. The carrying amounts of any inventories held for distribution are expensed when distributed.
Other operating expenses
Other operating expenses generally represent other day-to-day running costs incurred in normal operations. Refer to Note 5(f) for expenditure type. 
Fair value of assets and services provided free of charge or for nominal consideration
Contributions of resources provided free of charge or for nominal consideration are recognised at their fair value when the transferee obtains control over them, irrespective of whether restrictions or conditions are imposed over the use of the contributions, unless received from another government department or agency as a consequence of a restructuring of administrative arrangements. In the latter case, such a transfer will be recognised at its carrying value. 
Contributions in the form of services are only recognised when a fair value can be reliably determined and the services would have been purchased if not donated.

(h) Other economic flows included in the net result
Other economic flows measure the change in volume or value of assets or liabilities that do not result from transactions.
Net gain/(loss) on non-financial assets 
The net gain/(loss) on non financial assets and liabilities includes realised and unrealised gains and losses as follows:
Net gain/(loss) on disposal of property, plant and equipment
Any gain or loss on the disposal of property, plant and equipment is recognised at the date of disposal and is the difference between the proceeds and the carrying value of the asset at the time.
Recognition and derecognition of non-financial assets
Refer to Note 1(l) Non-financial assets.
Impairment of non-financial assets
Intangible assets with indefinite useful lives (and intangible assets not yet available for use) are tested annually for impairment (as described below) and whenever there is an indication that the asset may be impaired. 
All other assets are assessed annually for indications of impairment, except for:
inventories (refer Note 1(l) Non-financial assets)
non–financial physical assets held for sale (refer Note 1(l) Non-financial assets).
If there is an indication of impairment, the assets concerned are tested as to whether their carrying value exceeds their recoverable amount. Where an asset’s carrying value exceeds its recoverable amount, the difference is written off as an other economic flow, except to the extent that the write-down can be debited to an asset revaluation surplus amount applicable to that class of asset.
If there is an indication that there has been a reversal in the estimate of an asset’s recoverable amount since the last impairment loss was recognised, the carrying amount shall be increased to its recoverable amount. The impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised in prior years.
It is deemed that, in the event of the loss or destruction of an asset, the future economic benefits arising from the use of the asset will be replaced unless a specific decision to the contrary has been made. The recoverable amount for most assets is measured at the higher of depreciated replacement cost and fair value less costs to sell.
Refer to Note 1(l) Non-financial assets in relation to the recognition and measurement of non-financial assets.
Net gain/(loss) on financial instruments
Net gain/(loss) on financial instruments includes:
realised and unrealised gains and losses from revaluations of financial instruments at fair value
impairment and reversal of impairment for financial instruments at amortised cost (refer to Note 1(j) Financial instruments)
disposals of financial assets and derecognition of financial liabilities.
Revaluations of financial instruments at fair value
Refer to Note 1(j) Financial instruments.
Share of net profits/(losses) of associates, excluding dividends
The department recognises its share of the associate’s profit or loss as other economic flows. 
Other gains/(losses) from other economic flows
Other gains/(losses) from other economic flows include the gains or losses from: 
the revaluation of the present value of the long service leave liability due to changes in bond interest rates; and
re-measurement of other provisions. 
(i) Administered income
The department does not gain control over assets arising from administered income, consequently no income is recognised in the department’s financial statements. The department collects these amounts on behalf of the state.  Accordingly, the amounts are disclosed as income in the schedule of Administered Items (see Note 3. Administered (non-controlled) items).

Appropriations – Payments on behalf of the State
Appropriation income is recognised on an accrual basis for the provision of outputs delivered through Payments on Behalf of the State (POBOS).
Finance lease interest
Interest income from finance leases is recognised to reflect a constant periodic rate of return on the state’s net investment in finance leases. 
Sales of goods and services
Income from sales of goods and services is recognised by reference to the stage of completion of the services being performed and when the department no longer has any of the significant risks and rewards of ownership of the goods transferred to the buyer. 
Land titles income
Income for the provision of land titles data is recognised on behalf of the state on an accrual basis when services are provided. 
Royalties, land leases and licences
The department does not gain control over assets arising from administered royalties, consequently no income is recognised in the department’s financial statements. The department collects these amounts on behalf of the state. Accordingly, the amounts are disclosed as income in the schedule of Administered Items (refer to Note 3).
Income from leases and licences of Crown land is recognised on an accrual basis in accordance with the terms of the relevant agreements.
Environmental contribution
Water authorities are required to contribute towards initiatives to improve the sustainable management of water. These contributions are collected through the Environmental Contribution Levy and recognised as revenue when the department has the right to receive them on behalf of the state in accordance with AASB 1004 Contributions.
Grants 
The department’s administered grants mainly comprise funds provided by the Commonwealth to assist the state government in meeting general or specific service delivery obligations, primarily for the purpose of aiding the financing of the operations of the recipient, capital purposes and/or for on passing to other recipients. The department also receives grants for on passing from other jurisdictions. The department does not have control over these grants, and the income is not recognised in the department’s financial statements. Grant revenue is recognised on an accrual basis. Refer to Note 1(f) Income from transactions for the accounting for grants.
Jointly controlled assets received free of charge
On behalf of the state, the department jointly controls assets of the Murray-Darling Basin Authority. Jointly controlled assets received free of charge give rise to revenue, which is recognised on an accrual basis.
Other income
Amounts disclosed as other income include fines, donations and other miscellaneous income. 
The department does not gain control over assets arising from administered fines, consequently no income is recognised in the department’s financial statements. The department collects these amounts on behalf of the state. Accordingly, the amounts are disclosed as income in the schedule of Administered Items (refer to Note 3).
Donations and other miscellaneous income are recognised when received.
(j) Financial instruments
Financial instruments arise out of contractual agreements that give rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Due to the nature of the department’s activities, certain financial assets and financial liabilities arise under statute rather than a contract. Such financial assets and financial liabilities do not meet the definition of financial instruments in AASB 132 Financial Instruments: Presentation. For example, statutory receivables arising from taxes, fines and penalties do not meet the definition of financial instruments as they do not arise under contract. However, guarantees issued by the Treasurer on behalf of the department are financial instruments because, although authorised under statute, the terms and conditions for each financial guarantee may vary and are subject to an agreement.
Where relevant, for note disclosure purposes, a distinction is made between those financial assets and financial liabilities that meet the definition of financial instruments in accordance with AASB 132 and those that do not.
The following refers to financial instruments unless otherwise stated.
Categories of non-derivative financial instruments
Loans and receivables 
Loans and receivables are financial instrument assets with fixed and determinable payments that are not quoted on an active market. These assets are initially recognised at fair value plus any directly attributable transaction costs. Subsequent to initial measurement, loans and receivables are measured at amortised cost using the effective interest method, less any impairment.
The loans and receivables category includes cash and deposits (refer to Note 1(k) Financial assets), term deposits with maturity greater than three months, trade receivables, loans and other receivables, but not statutory receivables.
Financial assets at fair value through profit  and loss 
Financial assets are categorised at fair value through profit or loss at trade date if they are classified as held for trading or designated as such upon initial recognition. Financial instrument assets are designated at fair value through profit or loss on the basis that the financial assets form part of a group of financial assets that are managed by the entity concerned based on their fair values, and have their performance evaluated in accordance with documented risk management and investment strategies.
Financial instruments at fair value through profit or loss are initially measured at fair value and any attributable transaction costs are expensed as incurred. Subsequently, any changes in fair value are recognised in the net result as other economic flows. 
Financial assets at fair value through profit or loss represents the department’s investment in managed fund. 
Financial liabilities at amortised cost
Financial liabilities are initially recognised on the date they originate. They are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, these financial instruments are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in profit and loss over the period of the interest bearing liability, using the effective interest method (refer to Note 35. Glossary of terms and style conventions).
Financial instrument liabilities measured at amortised cost include all of the department’s contractual payables, deposits held and advances received, interest bearing arrangements other than those designated at fair value through profit or loss, but not statutory payables.
(k) Financial assets
Cash and deposits
Cash and deposits, recognised on the balance sheet, comprise cash on hand and cash at bank, deposits at call and those highly liquid investments (with an original maturity of three months or less) which are held for the purpose of meeting short term cash commitments rather than for investment purposes, and readily convertible to known amounts of cash with an insignificant risk of changes in value. 
Receivables
Receivables consist of: 
contractual receivables, which include mainly debtors in relation to goods and services, loans to third parties and accrued investment income; and
statutory receivables, which include predominantly amounts owing from the Victorian Government, landfill levies receivable and GST input tax credits recoverable. 
Contractual receivables are classified as financial instruments and categorised as loans and receivables (refer to Note 1(j) Financial instruments for recognition and measurement). Statutory receivables are recognised and measured similarly to contractual receivables (except for impairment), but are not classified as financial instruments because they do not arise from a contract.
Receivables are subject to impairment testing as described below. A provision for doubtful receivables is recognised when there is objective evidence that the debts may not be collected, and bad debts are written off when identified (refer to Impairment of Financial Assets under Note 1(k) Financial assets).
Investments and other financial assets
Any interest earned on a financial asset is recognised in the comprehensive operating statement as a transaction.
The investment in managed fund includes funds deposited with the Victorian Funds Management Corporation’s Capital Stable Fund and is classified as a non-current financial asset. The Fund invests in a combination of asset classes which include cash deposits, fixed term deposits and equities which are subject to movements in equity prices.
Investments accounted for using the equity method
An associate is an entity over which the department exercises significant influence, but not control.
The investment in the associate is accounted for in the financial statements using the equity method. Under this method, the investment in the associate is recognised at cost on initial recognition, and the carrying amount is increased or decreased in subsequent years to recognise the department’s share of the profits or losses of the associate after the date of acquisition. The department’s share of the associate’s profit or loss is recognised in the department’s net result as other economic flows. The share of post-acquisition movements in revaluation surpluses and any other reserves is recognised in both the comprehensive operating statement and the statement of changes in equity. The cumulative post acquisition movements are adjusted against the carrying amount of the investment, including dividends received or receivable from the associate. 
Refer to Note 9 for the disclosure of the department’s interests in associates.  
Investments in joint operations
In respect of any interest in joint operations, the department recognises in the financial statements: 
its assets, including its share of any assets held jointly; 
its liabilities, including its share of any liabilities that it had incurred; 
its revenue from the sale of its share of the output from the joint operation; 
its share of the revenue from the sale of the output by the joint operation; and
its expenses, including its share of any expenses incurred jointly.
Refer to Note 3(c) and Note 10 for the disclosure of the department’s investments in joint operations. 
Derecognition of financial assets 
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when: 
the rights to receive cash flows from the asset have expired; or
the department retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full without material delay to a third party under a ‘pass through’ arrangement; or
the department has transferred its rights to receive cash flows from the asset and either:
(a)	has transferred substantially all the risks and rewards of the asset; or
(b)	has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
Where the department has neither transferred nor retained substantially all the risks and rewards or transferred control, the asset is recognised to the extent of the department’s continuing involvement in the asset.
Impairment of financial assets 
At the end of each reporting period, the department assesses whether there is objective evidence that a financial asset or group of financial assets is impaired. All financial instrument assets are subject to annual review for impairment.
Receivables are assessed for bad and doubtful debts on a regular basis. Those bad debts considered as written off by mutual consent are classified as a transaction expense. Bad debts not written off by mutual consent and the allowance for doubtful receivables are classified as other economic flows in the net result.
The amount of the allowance is the difference between the financial asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate.
In assessing impairment of statutory (non-contractual) financial assets, which are not financial instruments, professional judgement is applied in assessing materiality using estimates, averages and other computational methods in accordance with AASB 136 Impairment of Assets.
(l) Non-financial assets
Inventories
Inventories include goods and other property held either for sale or for distribution at zero or nominal cost, or for consumption in the ordinary course of business operations.
Inventories held for distribution are measured at cost, adjusted for any loss of service potential. All other inventories are measured at the lower of cost and net realisable value. Where inventories are acquired for no cost or nominal consideration, they are measured at current replacement cost at the date of acquisition.
Bases used in assessing loss of service potential for inventories held for distribution include current replacement cost and technical or functional obsolescence. Technical obsolescence occurs when an item still functions for some or all of the tasks it was originally acquired to do, but no longer matches existing technologies. Functional obsolescence occurs when an item no longer functions the way it did when it was first acquired.
Non-financial physical assets classified as held for sale
Non-financial physical assets (including disposal group assets) are treated as current and classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use.
This condition is regarded as met only when:
the asset is available for immediate use in the current condition; and
the sale is highly probable and the asset’s sale is expected to be completed within 12 months from the date of classification.
These non-financial physical assets, related liabilities and financial assets are measured at the lower of carrying amount and fair value less costs of disposal, and are not subject to depreciation or amortisation.
Property, plant and equipment
All non-financial physical assets are measured initially at cost and subsequently revalued at fair value less accumulated depreciation and impairment. Where an asset is acquired for no or nominal cost, the cost is its fair value at the date of acquisition. Assets transferred as part of a Machinery of Government change are transferred at their carrying amount. More details about the valuation techniques and inputs used in determining the fair value of non-financial physical assets are discussed in Note 13 Property, plant and equipment.
The initial cost for non-financial physical assets under a finance lease (refer to Note 1(n) Leases) is measured at amounts equal to the fair value of the leased asset or, if lower, the present value of the minimum lease payments, each determined at the inception of the lease.
Non-financial physical assets such as national parks, other Crown land and heritage assets are measured at fair value with regard to the property’s highest and best use after due consideration is made for any legal or physical restrictions imposed on the asset, public announcements or commitments made in relation to the intended use of the asset. Theoretical opportunities that may be available in relation to the asset are not taken into account until it is virtually certain that the restrictions will no longer apply. Therefore, unless otherwise disclosed, the current use of these non-financial physical assets will be their highest and best uses. 
The fair value of plant and equipment is normally determined by reference to the asset’s depreciated cost. 
Certain assets are acquired under finance leases, which may form part of a service concession arrangement. Refer to Notes 1(n) Leases and 1(p) Commitments for more information.
The cost of constructed non-financial physical assets includes the cost of all materials used in construction, direct labour on the project, and an appropriate proportion of variable and fixed overheads.
For the accounting policy on impairment of non-financial physical assets, refer to impairment of non-financial assets under Note 1(h) Other economic flows included in the net result.
The department capitalises expenditures on individual items of $5,000 (2015: $5,000) or more, and records these as non-financial assets. Aggregate expenditure on items that will, when completed, result in non-financial assets that provide future economic benefits is recognised as construction in progress.
Crown land
The department’s Crown land holdings include the following Crown land categories.

National parks
The area of public land set aside as national parks, which include state parks, wilderness parks, and other parks established under the National Parks Act 1975, comprises a diverse range of Crown land parcels permanently reserved for the benefit of the public. 
State forests
State forests include Crown land parcels managed to balance a variety of uses. These uses include conserving flora and fauna, protecting water catchments and water supply, providing timber for sustainable forestry, protecting landscape, archaeological and historic values, and providing recreational and educational opportunities. 
Conservation reserves
Land conservation reserves include Crown land parcels set aside for conservation of specific ecosystems, animal and plant species, geomorphological features, and significant historical and cultural qualities.
Historic and cultural assets 
During the reporting period, the department also held historic and cultural assets and other non-financial physical assets (including Crown land and infrastructure assets) that the department intends to preserve because of their unique historical, cultural or environmental attributes. 
The fair value of those assets is measured using the market approach. 
Roads 
Road network assets (including earthworks of the operational road networks) are measured at fair value, determined by reference to the asset’s depreciated replacement cost. The roads, tracks and trails managed by the department are defined as Rural Class 5 and are sub-divided into five sub-classes as follows:
5A Primary roads: all-weather road, predominantly two lane and mainly sealed
5B Secondary roads: all-weather two lane road, formed and gravelled or single lane sealed road with gravel shoulders
5C Minor roads: generally all-weather, single lane two-way unsealed formed road, usually lightly gravelled
5D Access roads: substantially single lane, two-way, generally dry weather formed (natural materials) road
5E Tracks and trails: predominantly single lane, two-way earth tracks (unformed) at or near the natural surface level.  Costs are expensed as incurred, because these tracks and trails have a useful life of less than one year.
Leasehold improvements
The cost of leasehold improvements is capitalised as an asset and depreciated over the shorter of the remaining term of the lease or the estimated useful life of the improvements.
Revaluations of non-financial physical assets 
Non financial physical assets are measured at fair value on a cyclical basis, in accordance with the Financial Reporting Direction (FRD) 103F Non-Current Physical Assets. A full revaluation normally occurs every five years, based upon the asset’s government purpose classification but may occur more frequently if fair value assessments indicate material changes in values. Independent valuers are generally used to conduct these scheduled revaluations. Roads and crossings are revalued using specialised advisors. Any interim revaluations are determined in accordance with the requirements of FRD 103F.
Revaluation increases or decreases arise from differences between an asset’s carrying value and fair value.
Net revaluation increases (where the carrying amount of a class of assets is increased as a result of a revaluation) are recognised in ‘Other economic flows – other comprehensive income’, and accumulated in equity under the physical asset revaluation surplus. However, the net revaluation increase is recognised in the net result to the extent that it reverses a net revaluation decrease in respect of the same class of property, plant and equipment previously recognised as an expense (other economic flows) in the net result.
Net revaluation decreases are recognised in ‘Other economic flows – other comprehensive income’ to the extent that a credit balance exists in the physical asset revaluation surplus in respect of the same class of property, plant and equipment. Otherwise, the net revaluation decreases are recognised immediately as other economic flows in the net result. The net revaluation decrease recognised in ‘Other economic flows – other comprehensive income’ reduces the amount accumulated in equity under the asset revaluation surplus. 

Revaluation increases and decreases relating to individual assets within a class of property, plant and equipment, are offset against one another within that class but are not offset in respect of assets in different classes.  The asset revaluation surplus is not transferred to accumulated funds on derecognition of the relevant asset.
The department has revalued its property, plant and equipment under the Public Safety and Environment Purpose Group at 30 June 2016. Refer to Note 13 Property, plant and equipment for more information.  
Recognition and derecognition of land
Land is recognised under the categories set out at Note 13. Property, plant and equipment when the department identifies specific parcels of land, park, forest or reserve that it controls and their cost can be reliably determined. The department considers relevant information, such as the purpose for which a particular parcel has been reserved, to determine the parcels of Crown land over which it has control and records this information in the Land Information Management System. Where land has been received at no cost the fair value is determined by the Valuer-General Victoria.
Other government entities are able to change the status of Crown land through grants and reservations made under legislation that is not administered by either of the Ministers who hold portfolio responsibility (for example, Crown grants may be issued under the Project Development and Construction Management Act 1994). The department’s policy is to recognise the effect of such changes when it is made aware of the change in status.
Land is derecognised when it is not eligible to be treated as a return of equity. Gains or losses on the recognition or derecognition of land are recognised in the net result (other economic flows).
Third party transfers
Land transferred to third parties is treated as a return of equity via administered expenses as per the requirements of FRD 117A Contributions of Existing Non-Financial Assets to Third Parties.
Intangible assets 
Purchased intangible assets are initially recognised at cost. Subsequently, intangible assets with finite useful lives are carried at cost less accumulated depreciation and accumulated impairment losses. Costs incurred subsequent to initial acquisition are capitalised when it is expected that additional future economic benefits will flow to the department.
When the recognition criteria in AASB 138 Intangible Assets are met, internally generated intangible assets are recognised and measured at cost less accumulated depreciation and impairment.
Currently, intangible assets reported by the department are software related.  Where expenditure exceeds $300,000 (2015: $300,000) on the development of databases, the department recognises databases as assets, at the value of the total expenditure on the development of the database.
Refer to Note 1(g) Depreciation and Note 1(h) Impairment of non-financial assets.
Expenditure on research activities is recognised as an expense in the period in which it is incurred.
An internally-generated intangible asset arising from development (or from the development phase of an internal project) is recognised if, and only if, all of the following are demonstrated:
(a) the technical feasibility of completing the intangible asset so that it will be available for use or sale;
(b) an intention to complete the intangible asset and use or sell it;
(c) the ability to use or sell the intangible asset;
(d) the intangible asset will generate probable future economic benefits;
(e) the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and
(f) the ability to measure reliably the expenditure attributable to the intangible asset during its development. 
Other non-financial assets
Prepayments
Other non-financial assets include prepayments which represent payments in advance of receipt of goods or services or that part of expenditure made in one accounting period covering a term extending beyond that period.
The balance includes advance payments to Goulburn Murray Water for the Connections Project and is unwound based on the percentage of completion of works. 
(m) Liabilities
Payables
Payables consist of:
Contractual payables, such as accounts payable, statutory payables and accruals. Accounts payable represent liabilities for goods and services provided to the department prior to the end of the financial year that are unpaid, and arise when the department becomes obliged to make future payments in respect of the purchase of those goods and services; and
Statutory payables, such as goods and services tax and fringe benefits tax payables.
Contractual payables are classified as financial instruments and categorised as financial liabilities at amortised cost (refer to Note 1(j) Financial instruments). Statutory payables are recognised and measured similarly to contractual payables, but are not classified as financial instruments and not included in the category of financial liabilities at amortised cost, because they do not arise from a contract.
Advances from the Public Account are made pursuant to section 37 of the FMA and represent payments made in advance of receiving appropriation funding. These advances are recognised at the gross value of amounts owing and are not discounted to the present value of future cash flows.
Borrowings
Borrowings relate to motor vehicles leased through the VicFleet and Fleet Plus finance lease facility. 
All interest bearing liabilities are initially recognised at fair value of the consideration received, less directly attributable transaction costs (refer also to Note 1(n) Leases). The department classifies its interest bearing liabilities as financial liabilities at amortised cost.
Unearned income
Unearned income consists of amounts received in advance from customers for goods and services that are to be delivered or provided by the department after the reporting date.
Deposits repayable
Deposits repayable consist of amounts received from customers as a form of security. Deposits are repayable to the customer once their obligations have been fulfilled.  
Provisions
Provisions are recognised when the department has a present obligation, the future sacrifice of economic benefits is probable, and the amount of the provision can be measured reliably.
The future sacrifice of economic benefits includes costs associated with insurance claims, restoration and rehabilitation related to bushfire activities involving the department, and other environmental activities such as native vegetation offsets.
The amount recognised as a liability is a reliable estimate of the consideration required to settle the present obligation at reporting period, taking into account the risks and uncertainties surrounding the obligation. 
When some or all of the economic benefits required to settle a provision are expected to be received from a third party, the receivable is recognised as an asset if it is virtually certain that recovery will be received and the amount of the receivable can be measured reliably. 
Employee benefits
Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave and long service leave for services rendered to the reporting date.
(i)	Wages, salaries and annual leave
	Liabilities for wages and salaries, including non-monetary benefits and annual leave, are all recognised in the provision for employee benefits, as ‘current liabilities’, because the department does not have an unconditional right to defer settlements of these liabilities. 
	Depending on the expectation of the timing of settlement, liabilities for wages and salaries, and annual leave are measured at: 
nominal value – if the department expects to wholly settle within 12 months; and 
present value – if the department does not expect to wholly settle within 12 months. 
(ii) Long service leave
	Liability for long service leave (LSL) is recognised in the provision for employee benefits.
	Unconditional LSL is disclosed in the notes to the financial statements as a current liability, even where the department does not expect to settle the liability within 12 months, because it will not have the unconditional right to defer the settlement of the entitlement should an employee take leave within 12 months.
	The components of this current LSL liability are measured at:
nominal value – if the department expects to wholly settle within 12 months; and 
present value – if the department does not expect to wholly settle within 12 months.
	Conditional LSL is disclosed as a non-current liability. There is an unconditional right to defer the settlement of the entitlement until the employee has completed the requisite years of service. This non current LSL liability is measured at present value.
	Any gain or loss following revaluation of the present value of non current LSL liability is recognised as a transaction, except to the extent that a gain or loss arises due to changes in bond interest rates for which it is then recognised as an other economic flow (refer to Note 1(h) Other economic flows included in net result).
(iii) Termination benefits
	Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee decides to accept an offer of benefits in exchange for the termination of employment. The department recognises termination benefits when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without the possibility of withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after the end of the reporting period are discounted to present value.
Employee benefits on-costs
Employee benefits on-costs such as payroll tax, workers compensation and superannuation are recognised separately from the provision for employee benefits.
Onerous contracts
An onerous contract is considered to exist when the unavoidable cost of meeting the contractual obligations exceeds the estimated economic benefits to be received. Present obligations arising under onerous contracts are recognised as a provision to the extent that the present obligation exceeds the estimated economic benefits to be received.

Financial guarantees
Payments that are contingent under financial guarantee contracts are recognised as a liability at the time the guarantee is issued. The liability is initially measured at fair value, and if there is a material increase in the likelihood that the guarantee may have to be exercised, then it is measured at the higher of the amount determined in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets and the amount initially recognised less cumulative amortisation, where appropriate.
In the determination of fair value, consideration is given to factors including the overall capital management /prudential supervision framework in operation, the protection provided by the state government by way of funding should the probability of default increase, the probability of default by the guaranteed party and the likely loss to the department in the event of default.
The value of loans and other amounts guaranteed by the Treasurer is disclosed in Note 22. Contingent assets and contingent liabilities.
Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires. When an existing financial liability is replaced by another form the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised as an ‘Other economic flow’ in the estimated comprehensive operating statement. 
(n) Leases
A lease is a right to use an asset for an agreed period of time in exchange for payment.
Leases are classified at their inception as either operating or finance leases based on the economic substance of the agreement to reflect the risks and rewards incidental to ownership. Leases of property, plant and equipment are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership from the lessor to the lessee. For service concession arrangements (refer to Note 1(r)), the commencement of the lease term is deemed to be the date the asset is commissioned. All other leases are classified as operating leases.
Finance leases
Department as lessor
Amounts due from lessees under finance leases are recorded as receivables. Finance lease receivables are initially recorded at amounts equal to the present value of the minimum lease payments receivable plus the present value of any unguaranteed residual value expected to accrue at the end of the lease term. Finance lease receipts are apportioned between periodic interest income and reduction of the lease receivable over the term of the lease in order to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease. 
Department as lessee
At the commencement of the lease term, finance leases are initially recognised as assets and liabilities at amounts equal to the fair value of the lease property or, if lower, the present value of the minimum lease payment, each determined at the inception of the lease. The lease asset is accounted for as a non financial physical asset. If there is certainty that the department will obtain the ownership of the lease asset by the end of the lease term, the asset shall be depreciated over the useful life of the asset. If there is no reasonable certainty that the lessee will obtain ownership by the end of the lease term, the asset shall be fully depreciated over the shorter of the lease term and its useful life.
Minimum finance lease payments are apportioned between reduction of the outstanding lease liability and periodic finance expense, which is calculated using the interest rate implicit in the lease and charged directly to the comprehensive operating statement. Contingent rentals associated with finance leases are recognised as an expense in the period in which they are incurred.
Operating leases
Department as lessee
Operating lease payments, including any contingent rentals, are recognised as an expense in the comprehensive operating statement on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern of the benefits derived from the use of the leased asset. The leased asset is not recognised in the balance sheet.
All incentives for the agreement of a new or renewed operating lease are recognised as an integral part of the net consideration agreed for the use of the leased asset, irrespective of the incentive’s nature or form or the timing of payments.
In the event that lease incentives are received to enter into operating leases, the aggregate cost of incentives are recognised as a reduction of rental expense over the lease term on a straight-line basis, unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
(o) Equity
Contributions by owners
Additions to net assets which have been designated as contributions by owners are recognised as contributed capital. Other transfers that are in the nature of contributions to or distributions by owners have also been designated as contributions by owners.
Transfers of net assets arising from administrative restructurings are treated as distributions to or contributions by owners. Transfers of net liabilities arising from administrative restructurings are treated as distributions to owners.
Transfers of net assets to third parties are treated as a return of equity via administered expenses, as required under FRD 117A Contributions of Existing Non-Financial Assets to Third Parties.
(p) Commitments
Commitments for future expenditure include operating and capital commitments arising from contracts. These commitments are disclosed by way of a note (refer to Note 21. Commitments for expenditure and Note 3. Administered (non-controlled) items) at their nominal value and inclusive of the goods and services tax (GST) payable. In addition, where it is considered appropriate and provides additional relevant information to users, the net present values of significant individual projects are stated. These future expenditures cease to be disclosed as commitments once the related liabilities are recognised in the balance sheet.
(q) Contingent assets and contingent liabilities
Contingent assets and contingent liabilities are not recognised in the balance sheet, but are disclosed by way of a note (refer to Note 22. Contingent assets and contingent liabilities) and, if quantifiable, are measured at nominal value. Contingent assets and liabilities are presented inclusive of GST receivable or payable respectively.
(r) Service concession arrangements
The department sometimes enters into certain arrangements with private sector participants to design and construct or upgrade an asset used to provide public services. These arrangements are typically complex and usually include the provision of operational and maintenance services for a specified period of time. These arrangements are often referred to as either Public Private Partnerships (PPPs) or Service Concession Arrangements (SCAs).
The department pays the operator over the period of the arrangement, subject to specified performance criteria being met. At the date of commitment to the principal provisions of the arrangement, these estimated periodic payments are allocated between a component related to the design and construction or upgrading of the asset and components related to the ongoing operation and maintenance of the asset. The former component is accounted for as a lease payment. The remaining components are accounted for as commitments for operating costs and capital expenditure which are accounted for in the comprehensive operating statement and balance sheet as they are incurred.
The department classifies PPPs as controlled or administered items in accordance with AASB 1050 Administered Items and the Victorian Government’s business rule, BFMG 60 Administered Items. Key indicators of control are where a PPP contributes to the achievement of the department’s outputs, or where controlled sources of income are used to fund obligations to the operator.
Refer to Note 3(c) for a description of the administered PPP and Note 10 Investments in joint operations for a description of the controlled PPPs. 
(s) Accounting for the goods and services tax (GST)
Income, expenses and assets are recognised net of the amount of associated GST, except where the GST incurred is not recoverable from the taxation authority. In this case, the GST payable is recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the balance sheet.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows. 
Commitments for expenditure and contingent assets and liabilities are also stated inclusive of GST.
(t) Foreign currency balances/transactions
The department occasionally transacts in foreign currency where the counter party invoices in foreign currency. 
All foreign currency transactions during the financial year are brought to account using the exchange rate in effect at the date of the transaction. Foreign monetary items existing at the end of the reporting period are translated at the closing rate at the date of the end of the reporting period. Non-monetary assets carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was determined. 
Foreign currency translation differences are recognised in other economic flows and accumulated in a separate component of equity, in the period in which they arise.
(u) Events after the reporting period
Note disclosure is made about events between the end of the reporting period and the date the financial statements are authorised for issue where the events relate to conditions which arose after the end of the reporting period and which may have a material impact on the results of subsequent years.
(v) Comparative amounts
Where the presentation or classification of items in the financial statements changes, the comparative amounts are also reclassified unless it is impractical to do so.  The nature, amount and reason for the reclassification are  also disclosed. If the reclassification affects an item on the balance sheet, a third statement of financial position is also presented.

(w) AASs issued that are not yet effective
Certain new AASs have been published that are not mandatory for the 30 June 2016 reporting period. DTF assesses the impact of all these new standards and advises the department  of their applicability and early adoption where applicable.
As at 30 June 2016, the following applicable AASs have been issued by the AASB but are not yet effective. They become effective for the first financial statements for reporting periods commencing after the stated operating date  as follows: 
Standard/ Interpretation	Summary	Applicable for annual reporting periods beginning on or after	Impact on public sector entity financial statements	
AASB 9 Financial Instruments	The key changes include the simplified requirements for the classification and measurement of financial assets, a new hedging accounting model and a revised impairment loss model to recognise impairment losses earlier, as opposed to the current approach that recognises impairment only when incurred.	1 January 2018	While the preliminary assessment has not identified any material impact arising from AASB 9, it will continue to be monitored and assessed. 	
AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010)	The requirements for classifying and measuring financial liabilities were added to AASB 9. The existing requirements for the classification of financial liabilities and the ability to use the fair value option have been retained. However, where the fair value option is used for financial liabilities the change in fair value is accounted for as follows:
The change in fair value attributable to changes in credit risk is presented in other comprehensive income (OCI); and 
Other fair value changes are presented in profit and loss. If this approach creates or enlarges an accounting mismatch in the profit or loss, the effect of the changes in credit risk are also presented in profit or loss. 	1 January 2018
	The assessment has indicated that there will be no impact on the department as its liabilities are measured at amortised cost.	
AASB 2014-1 Amendments to Australian Accounting Standards [Part E Financial Instruments]  	Amends various AASs to reflect the AASB’s decision to defer the mandatory application date of AASB 9 to annual reporting periods beginning on or after 1 January 2018 as a consequence of Chapter 6 Hedge Accounting, and to amend reduced disclosure requirements. 	1 January 2018
	This amending standard will defer the application period of AASB 9 to the 2018-19 reporting period in accordance with the transition requirements. 	
AASB 2014-7 Amendments to Australian Accounting Standards arising from AASB 9	Amends various AASs to incorporate the consequential amendments arising from the issuance of AASB 9. 	1 January 2018
	The assessment has indicated that there will be no significant impact for the department.  	
AASB 15 Revenue from Contracts with Customers	The core principle of AASB 15 requires an entity to recognise revenue when the entity satisfies a performance obligation by transferring a promised good or service to a customer.	1 January 2018	The changes in revenue recognition requirements in AASB 15 may result in changes to the timing and amount of revenue recorded in the financial statements. The Standard will also require additional disclosures on service revenue and contract modifications. 
A potential impact will be the upfront recognition of revenue from licenses and leases that cover multiple reporting periods. Revenue that was deferred and amortised over a period may now need to be recognised immediately as a transitional adjustment against the opening retained earnings if there are no former performance obligations outstanding.	
AASB 2014-5 Amendments to Australian Accounting Standards arising from AASB 15	Amends the measurement of trade receivables and the recognition of dividends.
Trade receivables, that do not have a significant financing component, are to be measured at their transaction price, at initial recognition. 
Dividends are recognised in the profit and loss only when:
the entity’s right to receive payment of the dividend is established; 
it is probable that the economic benefits associated with the dividend will flow to the entity; and 
the amount can be measured reliably.	1 January 2017, except amendments to AASB 9 (December 2009) and AASB 9 (December 2010) apply from 1 January 2018	The assessment has indicated that there will be no significant impact for the department.	
AASB 2015-8 Amendments to Australian Accounting Standards – Effective Date of AASB 15	This Standard defers the mandatory effective date of AASB 15 from 1 January 2017 to 1 January 2018.	1 January 2018	This amending standard will defer the application period of AASB 15 to the 2018-19 reporting period in accordance with the transition requirements. 	
AASB 2016-3 Amendments to Australian Accounting Standards – Clarifications to AASB 15	This Standard amends AASB 15 to clarify the requirements on identifying performance obligations, principal versus agent considerations and the timing of recognising revenue from granting a licence.  The amendments require: 
A promise to transfer to a customer a good or service that is ‘distinct’ to be recognised as a separate performance obligation; 
For items purchased online, the entity is a principal if it obtains control of the good or service prior to transferring to the customer; and 
For licences identified as being distinct from other goods or services in a contract, entities need to determine whether the licence transfers to the customer over time (right to use) or at a point in time (right to access).	1 January 2018	The assessment has indicated that there will be no significant impact for the department, other than the impact identified in AASB 15.	
AASB 16 Leases	The key changes introduced by AASB 16 include the recognition of most operating leases (which are current not recognised) on balance sheet.	1 January 2019	The assessment has indicated that as most operating leases will come on balance sheet, recognition of lease assets and lease liabilities will cause net debt to increase. 
Depreciation of lease assets and interest on lease liabilities will be recognised in the income statement with marginal impact on the operating surplus.
The amounts of cash paid for the principal portion of the lease liability will be presented within financing activities and the amounts paid for the interest portion will be presented within operating activities in the cash flow statement.
No change for lessors. 	
AASB 2014-4 Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation [AASB 116 & AASB 138]	Amends AASB 116 Property, Plant and Equipment and AASB 138 Intangible Assets to:
establish the principle for the basis of depreciation and amortisation as being the expected pattern of consumption of the future economic benefits of an asset; and
prohibit the use of revenue based methods to calculate the depreciation or amortisation of an asset, tangible or intangible, because revenue generally reflects the pattern of economic benefits that are generated from operating the business, rather than the consumption through the use of the asset. 	1 January 2016	The assessment has indicated that there is no expected impact as the revenue-based method is not used for depreciation and amortisation. 	
AASB 2014-9 Amendments to Australian Accounting Standards – Equity Method in Separate Financial Statements [AASB 1, 127 & 128]	Amends AASB 127 Separate Financial Statements to allow entities to use the equity method of accounting for investments in subsidiaries, joint ventures and associates in their separate financial statements.	1 January 2016	The assessment indicates that there is no expected impact as the entity will continue to account for the  investments in subsidiaries, joint ventures and associates using the cost method as mandated if separate financial statements are presented in accordance with FRD 113A.	
AASB 2014-10 Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture [AASB 10 & AASB 128]	AASB 2014-10 amends AASB 10 Consolidated Financial Statements and AASB 128 Investments in Associates to ensure consistent treatment in dealing with the sale or contribution of assets between an investor and its associate or joint venture. The amendments require that: 
a full gain or loss to be recognised by the investor when a transaction involves a business (whether it is housed in a subsidiary or not); and
a partial gain or loss to be recognised by the parent when a transaction involves assets that do not constitute a business, even if these assets are housed in a subsidiary.	1 January 2016	The assessment has indicated that there is limited impact, as the revisions to AASB 10 and AASB 128 are guidance in nature.	
AASB 2015-1 Amendments to Australian Accounting Standards – Annual Improvements to Australian Accounting Standards 2012-2014 Cycle [AASB 1, AASB 2, AASB 3, AASB 5, AASB 7, AASB 11, AASB 110, AASB 119, AASB 121, AASB 133, AASB 134, AASB 137 & AASB 140]	Amends the methods of disposal in AASB 5 Non-current assets held for sale and discontinued operations. 
Amends AASB 7 Financial Instruments by including further guidance on servicing contracts. 
	1 January 2016	The assessment has indicated that when an asset (or disposal group) is reclassified from ‘held to sale’ to ‘held for distribution’, or vice versa, the asset does not have to be reinstated in the financial statements.  
Entities will be required to disclose all types of continuing involvement the entity still has when transferring a financial asset to a third party under conditions which allow it to derecognise the asset. 
	
AASB 2015-6 Amendments to Australian Accounting Standards – Extending Related Party Disclosures to Not-for-Profit Public Sector Entities [AASB 10, AASB 124 & AASB 1049]	The Amendments extend the scope of AASB 124 Related Party Disclosures to not-for-profit public sector entities. A guidance has been included to assist the application of the Standard by not-for-profit public sector entities. 	1 January 2016	The amending standard will result in extended disclosures on the department’s key management personnel (KMP), and the related party transactions.	

In addition to the new standards and amendments above, the AASB has issued a list of other amending standards that are not effective for the 2015-16 reporting period (as listed below). In general, these amending standards include editorial and references changes that are expected to have insignificant impacts on the department. 
AASB 1057 Application of Australian Accounting Standards
AASB 2015-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 101 [AASB 7, AASB 101, AASB 134 & AASB 1049]
AASB 2015-9 Amendments to Australian Accounting Standards – Scope and Application Paragraphs [AASB 8, AASB 133 & AASB 1057]
AASB 2015-10 Amendments to Australian Accounting Standards – Effective Date of Amendments to AASB 10 and AASB 128
AASB 2016-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 107

Note, for the current year, given the number of consequential amendments to AASB 9 Financial Instruments and AASB 15 Revenue from Contracts with Customers, the standards/interpretations have been grouped together to provide a more relevant view of the upcoming changes. 

Note 2. Departmental (controlled) outputs
A description of departmental outputs performed during the year ended 30 June 2016, and the objectives of these outputs, are summarised below.
Healthy, resilient and biodiverse environment
Objective 
This objective delivers effective environment and climate change policy, programs, investment and regulation. It provides support for local communities and landholders engaged in environmental works, improves the transparency and delivery of environmental regulation, provides effective governance and investment in environmental programs and provides effective policy for environmental outcomes and resource efficiency.  
Environmental Policy  
This output leads the development and implementation of strategic, whole of government environmental and adaption policy. It provides responsive policy advice and direction to give effect to government priorities on waste, resource recovery and efficiency, ecosystem sustainability, as well as climate change adaption and mitigation. 
Environmental Programs  
This output delivers investment, regulatory and research functions that support diverse and resilient natural ecosystems for a liveable Victoria.  
Statutory Activities and Environmental Protection
This output effectively regulates pollution through statutory and non-statutory tools and settings, conducts enforcement activities and undertakes environmental condition monitoring and research. These activities protect and improve the environment to support a liveable and prosperous state by delivering clean air, healthy waterways, safe land, less waste and minimal disturbances from noise and odour for Victorians.  
Safe and sustainable water resources 
Objective 
This objective increases the efficiency of supply and use of water in cities and towns and improves environmental conditions and waterways to ensure Victoria has safe and sustainable water resources to meet future urban, rural and environmental needs.  

Effective Water Management and Supply 
This output develops policies, provides strategic advice and oversees regulatory systems and institutional arrangements to effectively manage Victoria’s water resources. Through this output, the department delivers on-ground environmental programs to improve the health of waterways; water industry reform, governance and performance oversight, sustainable irrigation programs and makes water resources information accessible to enable informed decision-making. 
Sustainable and effective local governments 
Objective 
This objective plans for the future growth and transformation of cities and regions and provides leadership and advice on heritage protection and the built environment. It delivers streamlined, fair and transparent planning, building and heritage systems.  
Local Government 
This output delivers activities in partnership with the local government sector to support effective and efficient governance and service provision. Through this output, the department administers programs to support local governments to deliver public library services and respond to and recover from natural disasters and provides support to the Victoria Grants Commission. 
A quality built environment
Objective 
This objective provides leadership and advice on heritage protection. It delivers streamlined, fair and transparent planning, building and heritage systems. 
Planning, Building and Heritage 
This output delivers programs to address the future growth and transformation of cities and regions through strategic and integrated land use planning; urban development, design and renewal; land supply; heritage conservation and management and regulatory reform. 
Reduced impact of major bushfires and other emergencies on people, property and the environment
Objective 
This objective delivers a risk-based approach to preparing for and responding to fire and emergencies to reduce the impact of these events on people, property and the environment and to improve community and ecosystem resilience. 
Fire and Emergency Management 
This output covers activities under an integrated management framework for the effective planning and management of fire and other emergencies to reduce the impact on people, property and the environment. 
Productive and effective land management 
Objective
This objective delivers effective management and governance of Victoria’s public land to protect its social, economic and environmental values and maximise its use by all Victorians. 
Land Victoria  
This output delivers high quality and authoritative land administration and property information services, including the registration of land titles under the Torrens system, survey, valuation and property sales and planning and property certificates.   
Management of Forests, Parks and Public Land   
This output provides for the improved stewardship of Victoria’s public land estate including forests, parks, coasts and Crown land reserves. Through this output, the department manages the development and protection of natural, cultural and community assets for the enjoyment and sustainable use by all Victorians. 
New output
The Statutory Activities and Environmental Protection output is reported by the department following transfer of management and administration of the Sustainability Fund from the Environment Protection Authority.
Note 2. Departmental (controlled) outputs (continued)
Schedule A - Controlled income and expenses for the year ended 30 June 2016
	Agriculture	Biosecurity	Environmental Policy                	Environmental Programs					
	2016	2015 (i)	2016	2015 (i)	2016	       2015	2016	2015	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Income from transactions									
Output appropriations	0	147,350	0	32,825	35,581	26,437	60,771	55,699	
Special appropriations	0	0	0	0	   0	0	   0	0	
Interest	0	747	0	0	   0	14	   0	37	
Sale of goods and services	0	7,703	0	2,026	 377	6,099	29,871	24,057	
Municipal and Industrial Landfill Levy	0	0	0	0	0	0	0	0	
Metropolitan Parks Improvement Rate	0	0	0	0	   0	1,400	   0	0	
Grants	0	(2)	0	0	2,542	9,678	 338	602	
Fair value of assets and services received free of charge or for nominal consideration	0	0	0	0	   0	0	   1	0	
Other income	0	5	0	(1)	20	0	0  	1,613	
Total income from transactions	   0	155,803	   0	34,850	38,520	43,628	90,981	82,008	
Expenses from transactions		 		 		 		 	
Employee expenses	0	(54,897)	0	(17,672)	(15,476)	(12,202)	(35,929)	(33,563)	
Depreciation	0	(9,801)	0	(379)	(291)	(394)	(2,755)	(2,769)	
Interest expense	0	(10,010)	0	0	(2)	(28)	(138)	(159)	
Grants and other transfers	0	(5,367)	0	(3,136)	(20,500)	(26,326)	(21,105)	(12,856)	
Capital asset charge	0	(18,257)	0	(201)	(115)	(119)	(2,004)	(2,016)	
Supplies and services	0	(64,992)	0	(14,841)	(1,947)	(7,732)	(11,524)	(18,130)	
Other operating expenses	0	(565)	0	(103)	(30)	(46)	(621)	(675)	
Total expenses from transactions	   0	(163,889)	   0	(36,332)	(38,361)	(46,847)	(74,076)	(70,168)	
Net result from transactions (net operating balance) 	   0	(8,086)	   0	(1,482)	159	(3,219)	16,905	11,840	
Other economic flows included in net result									
Net gain/(loss) on non-financial assets	0	341	0	30	(26)	(15)	  35	408	
Net gain/(loss) on financial instruments 	0	84	0	(17)	(7)	(3)	(27)	(9)	
Share of net profits/(losses) of associates, excluding dividends	0	0	0	0	   0	0	   0	0	
Other gains/(losses) from other economic flows	0	(306)	0	(28)	(3)	(27)	(9)	(75)	
Total other economic flows included in net result	   0	 119	   0	(15)	(36)	(45)	(1)	 324	
Net result 	   0	(7,967)	   0	(1,497)	123	(3,264)	16,904	12,164	
Other economic flows – other comprehensive income									
Items that will not be classified to net result									
Changes in physical asset revaluation surplus	0	0	0	0	0	0	0	0	
Share of change in associate’s contributed capital	0	0	0	0	0	0	0	0	
Total other economic flows – other comprehensive income	   0	0	   0	0	   0	0	   0	0	
Comprehensive result 	   0	(7,967)	   0	(1,497)	123	(3,264)	16,904	12,164	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to the Department of Economic Development, Jobs, Transport and Resources (DEDJTR). At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to the Department of Premier and Cabinet (DPC). Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from the Environment Protection Authority (EPA) to the department on 1 July 2015 has resulted in a new output Statutory Activities and 			Environmental Protect
	Effective Water Management and Supply	Local Government	Office of the Victorian Government Architect	Planning, Building and Heritage	Fire and Emergency Management						
	2016	2015	2016	2015 (i)	2016	2015 (i)(ii)	2016	     2015(i)	2016	2015	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Income from transactions											
Output appropriations	246,062	349,534	114,972	9,278	0	470	67,811	34,756	389,234	332,090	
Special appropriations	   0	99,580	   0	0	0	0	58,746	15,842	   0	0	
Interest	4,173	3,576	   0	0	0	0	1,449	351	   0	171	
Sale of goods and services	10,492	9,846	0	98	0	102	4,081	(45)	7,478	15,327	
Municipal and Industrial Landfill Levy	0	0	0	0	0	0	0	0	0	0	
Metropolitan Parks Improvement Rate	   0	0	   0	0	0	0	   0	0	   0	0	
Grants	5,196	195,268	3,579	2,400	0	0	(601)	2,964	2,488	1,737	
Fair value of assets and services received free of charge or for nominal consideration	   1	0	   2	63	0	0	0	0	   1	1	
Other income	  92	9,067	   0	0	0	0	2,133	0	0	57	
Total income from transactions	266,016	666,871	118,553	11,839	   0	 572	133,619	53,868	392,201	349,383	
Expenses from transactions		 		 		 		 		 	
Employee expenses	(57,642)	(49,722)	(8,489)	(3,545)	0	(418)	(31,643)	(15,473)	(137,656)	(120,065)	
Depreciation	(4,369)	(6,614)	(39)	(14)	0	0	(295)	(192)	(20,536)	(21,750)	
Interest expense	0	(465)	1	(2)	0	0	1	(2)	(655)	(1,177)	
Grants and other transfers	(157,315)	(166,301)	(105,058)	(3,968)	0	0	(16,754)	(9,848)	(26,523)	(21,633)	
Capital asset charge	(2,845)	(2,920)	0	0	0	(6)	(14,987)	(7,503)	(52,960)	(52,981)	
Supplies and services	(232,514)	(151,292)	(6,459)	(1,834)	0	(50)	(8,756)	(8,439)	(151,346)	(125,557)	
Other operating expenses	(166)	(177)	(19)	(63)	0	0	(11)	0	(6,823)	(4,640)	
Total expenses from transactions	(454,851)	(377,491)	(120,063)	(9,426)	0	(474)	(72,445)	(41,457)	(396,499)	(347,803)	
Net result from transactions (net operating balance) 	(188,835)	289,380	(1,510)	2,413	   0	  98	61,174	12,411	2,702	1,580	
Other economic flows included in net result											
Net gain/(loss) on non-financial assets	(550)	(177)	  29	210	0	0	(473) 	(4,814)	 470	4,028	
Net gain/(loss) on financial instruments 	(128)	(34)	(93)	0	0	0	(256)	0	(106)	(34)	
Share of net profits/(losses) of associates, excluding dividends	   0	0	0	0	0	0	0	0	   0	0	
Other gains/(losses) from other economic flows	(55)	(453)	0	5	0	0	0	22	(41)	(343)	
Total other economic flows included in net result	(733)	(664)	(64)	 215	   0	0	(729)	(4,792)	 323	3,651	
Net result 	(189,568)	288,716	(1,574)	2,628	   0	  98	60,445	7,619	3,025	5,231	
Other economic flows – other comprehensive income											
Items that will not be classified to net result											
Changes in physical asset revaluation surplus	0	0	0	0	0	0	0	0	0	0	
Share of change in associate’s contributed capital	0	0	0	0	0	0	0	0	0	0	
Total other economic flows – other comprehensive income	   0	0	   0	   0	   0	   0	   0	0	   0	   0	
Comprehensive result 	(189,568)	288,716	(1,574)	2,628	   0	  98	60,445	7,619	3,025	5,231	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers.
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection.
Note 2. Departmental (controlled) outputs (continued)
Schedule A - Controlled income and expenses for the year ended 30 June 2015 (continued)
	Sustainably Manage Fish and Forest Resources	   Management of Forests, Parks and Public Land	   Land Victoria	Statutory Activities and Environmental Protection	Total						
	2016	2015 (i)	2016	2015	2016	      2015 (i)  	2016 (iii)	      2015 	2016 (iii)	2015 (i) (ii) 	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Income from transactions											
Output appropriations	0	35,694	178,346	162,909	71,632	38,151	   0	0	1,164,409	1,225,193	
Special appropriations	0	0	   0	0	   0	0	   0	0	58,746	115,422	
Interest	0	31	1,600	1,940	   0	0	11,845	0	19,067	6,867	
Sale of goods and services	0	3,228	4,005	3,615	13,767	6,439	0	0	70,071	78,495	
Municipal and Industrial Landfill Levy	0	0	0	0	0	0	201,170	0	201,170	0	
Metropolitan Parks Improvement Rate	0	0	159,537	151,164	   0	0	0	0	159,537	152,564	
Grants	0	186	  20	166	   0	0	0	0	13,562	212,999	
Fair value of assets and services received free of charge or for nominal consideration	0	0	   0	0	   0	0	0	0	   5	64	
Other income	0	0	   7	600	   0	0	0	0	2,252	11,341	
Total income from transactions	   0	39,139	343,515	320,394	85,399	44,590	213,015	   0	1,688,819	1,802,945	
Expenses from transactions		 		 		 				 	
Employee expenses	0	(9,974)	(40,447)	(35,554)	(36,184)	(16,656)	(209)	0	(363,675)	(369,741)	
Depreciation	0	(948)	(12,785)	(13,301)	(363)	(597)	   0	0	(41,433)	(56,759)	
Interest expense	0	1	(169)	(147)	(20)	(5)	0	0	(982)	(11,994)	
Grants and other transfers	0	(21,573)	(209,929)	(190,428)	(1)	(1)	(76,419)	0	(633,604)	(461,437)	
Capital asset charge	0	(300)	(17,697)	(17,697)	(734)	(392)	   0	0	(91,342)	(102,392)	
Supplies and services	0	(8,902)	(47,156)	(41,475)	(47,576)	(27,234)	(16,807)	0	(524,085)	(470,478)	
Other operating expenses	0	(93)	(48)	(248)	(4,929)	0	   0	0	(12,647)	(6,610)	
Total expenses from transactions	   0	(41,789)	(328,231)	(298,850)	(89,807)	(44,885)	(93,435)	   0	(1,667,768)	(1,479,411)	
Net result from transactions (net operating balance) 	   0	(2,650)	15,284	21,544	(4,408)	(295)	119,580	   0	21,051	323,534	
Other economic flows included in net result											
Net gain/(loss) on non-financial assets	0	25	(50,484)	7,304	  26	30	   0	0	(50,973)	7,370	
Net gain/(loss) on financial instruments 	0	(13)	(40)	(10)	(579)	0	3,947	0	2,711	(36)	
Share of net profits/(losses) of associates, excluding dividends	0	0	   0	0	(4,377)	(2,985)	   0	0	(4,377)	(2,985)	
Other gains/(losses) from other economic flows	0	(17)	(15)	(123)	(2,021)	15	   0	0	(2,144)	(1,330)	
Total other economic flows included in net result	   0	(5)	(50,539)	7,171	(6,951)	(2,940)	3,947	   0	(54,783)	3,019	
Net result 	   0	(2,655)	(35,255)	28,715	(11,359)	(3,235)	123,527	   0	(33,732)	326,553	
Other economic flows – other comprehensive income	 										
Items that will not be classified to net result											
Changes in physical asset revaluation surplus	0	0	969,019	111,647	0	0	0	0	969,019	111,647	
Share of change in associate’s contributed capital	0	0	0	0	8,548	155	0	0	8,548	155	
Total other economic flows – other comprehensive income	   0	   0	969,019	111,647	8,548	 155	   0	   0	977,567	111,802	
Comprehensive result 	   0	(2,655)	933,764	140,362	(2,811)	(3,080)	123,527	   0	943,835	438,355	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33.Restructure of administrative arrangements for more information on the resulting transfers.
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection.
Schedule B - Controlled assets and liabilities as at 30 June 2016
	Agriculture	Biosecurity	Environmental Policy	Environmental Programs					
	2016  $’000	2015 (i)  $’000	2016  $’000	2015 (i)  $’000	2016  $’000	2015  $’000	2016 $’000	2015 $’000	
Assets									
Financial assets									
Cash and deposits	   0	0	   0	0	12,350	14,944	60,865	44,841	
Receivables	   0	0	   0	0	4,162	6,317	18,380	18,546	
Investments and other financial assets	   0	0	   0	0	   0	0	   0	0	
Investments accounted for using the equity method	   0	0	   0	0	   0	0	   0	0	
Total financial assets	   0	   0	   0	   0	16,512	21,261	79,245	63,387	
Non-financial assets		 	 		 	 		 	
Inventories	   0	0	0	0	   2	0	  44	17	
Non-financial physical assets classified as held for sale	   0	0	0	0	  12	8	  33	22	
Property, plant and equipment	   0	0	0	0	5,226	4,367	68,536	45,086	
Biological assets	   0	0	0	0	   0	0	   0	0	
Intangible assets	   0	0	0	0	   0	1	7,018	6,951	
Prepayments	   0	0	0	0	 220	176	1,635	500	
Total non-financial assets	   0	   0	   0	   0	5,460	4,552	77,266	52,576	
Total assets	   0	   0	   0	   0	21,972	25,813	156,511	115,963	
Liabilities									
Payables	   0	0	0	   0	7,956	9,548	4,841	4,921	
Borrowings	   0	0	0	   0	85	139	3,912	3,153	
Unearned income	   0	0	0	   0	   0	0	   5	4	
Deposits repayable	   0	0	0	   0	   0	0	   2	2	
Provisions	   0	0	0	   0	5,476	4,600	15,061	15,706	
Total liabilities	   0	   0	   0	   0	13,517	14,287	23,821	23,786	
Net assets 	0	   0	   0	   0	8,455	11,526	132,690	92,177	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33.  Restructure of administrative arrangements for more information on the resulting transfers.
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection. 
	Effective Water  Management and Supply	Local Government	Office of the  Victorian Government Architect	Planning, Building and Heritage					
	2016 $’000	2015 $’000	2016 $’000	 2015 (i) $’000	2016 $’000	2015 (i)(ii) $’000	2016 $’000	2015 (i) $’000	
Assets									
Financial assets									
Cash and deposits	206,277	273,099	(1,475)	1,265	   0	0	39,542	92,238	
Receivables	66,792	100,321	3,900	2,868	   0	0	12,362	12,406	
Investments and other financial assets	   0	0	   0	0	   0	0	105,930	0	
Investments accounted for using the equity method	   0	0	   0	0	   0	0	   0	0	
Total financial assets	273,069	373,420	2,425	4,133	   0	   0	157,834	104,644	
Non-financial assets		 		 		 		 	
Inventories	  29	7	   0	0	   0	0	   0	0	
Non-financial physical assets classified as held for sale	 203	134	   0	0	0	0	2,520	0	
Property, plant and equipment	179,487	167,318	 226	29	   0	0	203,164	181,390	
Biological assets	   0	0	   0	0	   0	0	   0	0	
Intangible assets	   0	15	   0	0	   0	0	 288	328	
Prepayments	3,681	74,039	(1)	0	   0	0	(4)	0	
Total non-financial assets	183,400	241,513	 225	  29	   0	   0	205,968	181,718	
Total assets	456,469	614,933	2,650	4,162	   0	   0	363,802	286,362	
Liabilities									
Payables	22,401	35,762	3,883	255	   0	0	2,139	2,849	
Borrowings	 179	769	187	(12)	   0	0	 514	208	
Unearned income	6	3	   0	0	   0	0	2,000	1,999	
Deposits repayable	   0	1	   0	0	   0	0	  11	28	
Provisions	20,973	20,968	2,760	1,771	   0	0	9,751	8,922	
Total liabilities	43,523	57,503	6,830	2,014	   0	   0	14,415	14,006	
Net assets 	412,946	557,430	(4,180)	2,148	   0	   0	349,387	272,356	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers.
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection. 
	Fire and Emergency Management	Sustainably Manage  Fish and Forest Resources	Management of Forests, Parks and Public Land	Land Victoria					
	2016	2015  	2016	2015 (i)	2016	2015 	2016	2015 (i)	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Assets									
Financial assets									
Cash and deposits	102,145	104,911	   0	   0	44,613	51,563	(3,568)	4,676	
Receivables	58,810	81,045	   0	   0	18,789	28,108	18,106	15,859	
Investments and other financial assets	   0	0	   0	   0	30,779	20,100	   0	0	
Investments accounted for using the equity method	   0	0	   0	   0	   0	0	11,349	9,199	
Total financial assets	160,955	185,956	   0	   0	94,181	99,771	25,887	29,734	
Non-financial assets		 		 		 		 	
Inventories	17,941	16,229	   0	0	2,651	2,198	 366	366	
Non-financial physical assets classified as held for sale	 155	102	   0	0	5,397	2,007	   0	0	
Property, plant and equipment	1,951,964	2,022,623	   0	0	5,951,775	5,142,013	10,761	10,569	
Biological assets	   0	0	   0	0	   0	0	   0	0	
Intangible assets	22,067	19,743	   0	0	   0	4	   0	0	
Prepayments	2,806	2,191	   0	0	 995	818	  35	40	
Total non-financial assets	1,994,933	2,060,888	   0	   0	5,960,818	5,147,040	11,162	10,975	
Total assets	2,155,888	2,246,844	   0	   0	6,054,999	5,246,811	37,049	40,709	
Liabilities									
Payables	17,608	30,522	   0	0	31,516	41,291	1,862	1,798	
Borrowings	25,685	22,916	   0	0	 839	1,071	1,318	627	
Unearned income	   5	2	   0	0	 205	271	(25)	(25)	
Deposits repayable	   0	1	   0	0	   0	(1)	   0	0	
Provisions	51,454	59,547	   0	0	15,229	13,813	15,969	12,429	
Total liabilities	94,752	112,988	   0	   0	47,789	56,445	19,124	14,829	
Net assets 	2,061,136	2,133,856	   0	   0	6,007,210	5,190,366	17,925	25,880	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers.
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection. 
	Statutory Activities and Environmental Protection	Total			
	2016 (iii)	 2015 	2016 (iii)	 2015 (i)(ii)	
	$’000	$’000	$’000	$’000	
Assets					
Financial assets					
Cash and deposits	92,661	0	553,410	587,537	
Receivables	101,934	0	303,235	265,470	
Investments and other financial assets	373,591	0	510,300	20,100	
Investments accounted for using the equity method	   0	0	11,349	9,199	
Total financial assets	568,186	   0	1,378,294	882,306	
Non-financial assets			 		
Inventories	   0	0	21,033	18,817	
Non-financial physical assets classified as held for sale	0	0	8,320	2,273	
Property, plant and equipment	   0	0	8,371,139	7,573,395	
Biological assets	   0	0	   0	0	
Intangible assets	   0	0	29,373	27,042	
Prepayments	   0	0	9,367	77,764	
Total non-financial assets	   0	   0	8,439,232	7,699,291	
Total assets	568,186	   0	9,817,526	8,581,597	
Liabilities					
Payables	19,797	0	112,003	126,946	
Borrowings	   0	0	32,719	28,871	
Unearned income	   0	0	2,196	2,254	
Deposits repayable	   0	0	  13	31	
Provisions	  48	0	136,685	137,756	
Total liabilities	19,845	   0	283,616	295,858	
Net assets 	548,341	   0	9,533,910	8,285,739	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers.
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection. 
Note 3. Administered (non-controlled) items
In addition to the specific departmental operations which are included in the financial statements (balance sheet, comprehensive operating statement, cash flow statement and statement of changes in equity), the department administers or manages other activities and resources on behalf of the state. The transactions and balances relating to these activities are reported as administered items in this note.
(a) Administered income and expenses for the year ended 30 June 2016
	Agriculture	Biosecurity	Environmental Policy	Environmental Programs					
	2016 	2015 (i)	2016	2015 (i)	2016	2015	2016	2015	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Administered income from transactions									
Appropriations – payments on behalf of the State (POBOS)	0	0	0	0	0	0	0	0	
Finance lease interest	0	0	0	0	0	0	1	1	
Sales of goods and services 	0	7,447	0	1,561	1	417	 299	1,450	
Royalties, land leases and licences	0	0	0	0	0	3	1,044	1,156	
Land Titles income	0	0	0	0	0	0	0	0	
Environmental contribution	0	0	0	0	0	0	0	0	
Grants	0	2,788	0	0	318	417	295	347	
Jointly controlled assets received free of charge	0	0	0	0	0	0	0	0	
Fair value of land received from third party	0	0	0	0	0	0	0	0	
Other income 	0	922	0	188	9	50	  24	138	
Total administered income from transactions	   0	11,157	   0	1,749	328	 887	1,663	3,092	
Administered expenses from transactions									
Grants and other transfers	0	0	0	0	0	0	0	0	
Finance lease interest expense	0	0	0	0	0	0	0	0	
Other expenses	0	0	0	0	0	11	49	37	
Depreciation of jointly controlled assets 	0	0	0	0	0	0	0	0	
Other expenses associated with jointly controlled assets 	0	0	0	0	0	0	0	0	
Payments into the consolidated fund	0	(106)	0	(10)	(438)	(1,608)	(2,002)	(5,050)	
Total administered expenses from transactions	0	(106)	0	(10)	(438)	(1,597)	(1,953)	(5,013)	
Total administered net result from transactions (net operating balance)	0	11,051	   0	1,739	(110)	(710)	(290)	(1,921)	
Administered other economic flows included in net result									
Net gain/(loss) on non-financial assets	0	6	0	0	(130)	313	(384)	786	
Net gain/(loss) on financial instruments	0	0	0	0	0	(1)	0	(2)	
Total administered other economic flows included in net result	   0	   6	0	0	(130)	312	(384)	784	
Administered net result	   0	11,057	   0	1,739	(240)	(398)	(674)	(1,137)	
Administered comprehensive result	   0	11,057	   0	1,739	(240)	(398)	(674)	(1,137)	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection.  
	Effective Water Management and Supply	Local Government	Office of the Victorian Government Architect	Planning, Building and Heritage	Fire and Emergency Management						
	2016	2015	2016	2015 (i)	2016	2015 (i)(ii)	2016	2015 (i)	2016	2015	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Administered income from transactions											
Appropriations – Payments on behalf of the State (POBOS)	636,913	628,074	0	0	0	0	0	0	0	0	
Finance lease interest	452,383	466,816	0	0	0	0	0	0	0	0	
Sales of goods and services 	123,324	136,050	0	0	0	0	1,217	486	   9	5,248	
Royalties, land leases and licences	   0	49	0	0	0	0	11	0	  13	54	
Land Titles income	   0	0	0	0	0	0	0	0	0	0	
Environmental contribution	111,963	111,946	0	0	0	0	0	0	0	0	
Grants	22,434	27,413	269,555	540,663	0	0	0	0	0	3	
Jointly controlled assets received free of charge	3,708	6,719	0	0	0	0	0	0	0	0	
Fair value of land received from third party	0	0	0	0	0	0	0	0	0	0	
Other income 	 146	838	   0	0	   0	0	(42)	2	 111	633	
Total administered income from transactions	1,350,871	1,377,905	269,555	540,663	   0	0	1,186	 488	 133	5,938	
Administered expenses from transactions											
Grants and other transfers	(23,568)	(18,000)	(269,555)	(540,663)	   0	0	   0	0	0	0	
Finance lease interest expense	(452,544)	(466,974)	0	0	0	0	0	0	0	0	
Other expenses	(37,888)	(105,741)	(30)	0	   0	0	(1)	0	(2)	135	
Depreciation of jointly controlled assets 	(10,109)	(10,344)	0	0	0	0	0	0	0	0	
Other expenses associated with jointly controlled assets 	0	(655)	0	0	   0	0	   0	0	0	0	
Payments into the Consolidated Fund	(746,977)	(792,508)	   0	0	0	0	(5,765)	(217)	(1,521)	(14,987)	
Total administered expenses from transactions	(1,271,086)	(1,394,222)	(269,585)	(540,663)	   0	0	(5,766)	(217)	(1,523)	(14,852)	
Total administered net result from transactions (net operating balance)	79,785	(16,317)	(30)	0	0	0	(4,580)	271	(1,390)	(8,914)	
Administered other economic flows included in net result											
Net gain/(loss) on non-financial assets	15,737	34,925	   0	0	   0	0	(5,973)	0	(5,383)	3,589	
Net gain/(loss) on financial instruments	0	(15)	0	0	0	0	(4)	0	0	(11)	
Total administered other economic flows included in net result	15,737	34,910	   0	0	   0	0	(5,977)	   0	(5,383)	3,578	
Administered net result	95,522	18,593	(30)	0	   0	0	(10,557)	271	(6,773)	(5,336)	
Administered comprehensive result	95,522	18,593	(30)	0	   0	0	(10,557)	271	(6,773)	(5,336)	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection. 

	Sustainably Manage Fish and Forest Resources	Management of Forests, Parks and Public Land	Land Victoria	Statutory Activities and Environmental Protection	Total						
	2016	2015 (i)	2016	2015	2016	2015 (i)	2016 (iii)	2015	2016 (iii)	2015 (i) (ii)	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Administered income from transactions											
Appropriations – Payments on behalf of the State (POBOS)	0	0	   0	0	   0	0	   0	0	636,913	628,074	
Finance lease interest	0	0	   1	2	   0	0	   0	0	452,385	466,819	
Sales of goods and services 	0	11,518	12,349	13,619	26,551	14,472	   0	0	163,750	192,268	
Royalties, land leases and licences	0	44	9,170	8,793	   0	0	   0	0	10,238	10,099	
Land Titles income	0	0	   0	0	322,032	148,890	   0	0	322,032	148,890	
Environmental contribution	0	0	   0	0	   0	0	   0	0	111,963	111,946	
Grants	0	0	   0	1	   0	0	   0	0	292,602	571,632	
Jointly controlled assets received free of charge	0	0	   0	810	   0	0	   0	0	3,708	7,529	
Fair value of land received from third party	0	0	0	378	0	0	0	0	0	378	
Other income 	0	113	  40	227	0	27	   0	0	 288	3,138	
Total administered income from transactions	   0	11,675	21,560	23,830	348,583	163,389	   0	   0	1,993,879	2,140,773	
Administered expenses from transactions											
Grants and other transfers	0	0	   0	0	   0	0	   0	0	(293,123)	(558,663)	
Finance lease interest expense	0	0	   0	0	   0	0	   0	0	(452,544)	(466,974)	
Other expenses	0	0	(89,854)	(468)	(3)	0	   0	0	(127,729)	(106,026)	
Depreciation of jointly controlled assets 	0	0	   0	0	   0	0	   0	0	(10,109)	(10,344)	
Other expenses associated with jointly controlled assets 	0	0	   0	0	   0	0	   0	0	   0	(655)	
Payments into the Consolidated Fund	0	(6)	(27,907)	(24,717)	(345,115)	(160,940)	   0	0	(1,129,725)	(1,000,149)	
Total administered expenses from transactions	0	(6)	(117,761)	(25,185)	(345,118)	(160,940)	   0	   0	(2,013,230)	(2,142,811)	
Total administered net result from transactions (net operating balance)	   0	11,669	(96,201)	(1,355)	3,465	2,449	   0	   0	(19,351)	(2,038)	
Administered other economic flows included in net result											
Net gain/(loss) on non-financial assets	0	17	 729	(24,553)	(1)	(1)	   0	0	4,595	15,082	
Net gain/(loss) on financial instruments	0	0	(322)	(195)	 151	0	   0	0	(175)	(224)	
Total administered other economic flows included in net result	   0	  17	 407	(24,748)	 150	(1)	   0	   0	4,420	14,858	
Administered net result	   0	11,686	(95,794)	(26,103)	3,615	2,448	   0	   0	(14,931)	12,820	
Administered comprehensive result	   0	11,686	(95,794)	(26,103)	3,615	2,448	   0	   0	(14,931)	12,820	

Note:
(i)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(ii)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iii)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection.  

Note 3. Administered (non-controlled) items (continued)
(b) Administered assets and liabilities as at 30 June 2016
	Agriculture	Biosecurity	Environmental Policy	Environmental Programs					
	2016	2015 (iii)	2016	2015 (iii)	2016	2015	2016	2015	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Administered financial assets(i)									
Cash 	0	0	0	0	21 	28	124	142	
Receivables	   0	0	   0	0	 690	130	1,894	392	
Finance lease receivables	0	0	0	0	0	0	0	0	
Total administered financial assets	0	   0	   0	   0	 711	 158	2,018	 534	
Administered non-financial assets									
Share of jointly controlled assets 	0	0	0	0	0	0	0	0	
Total administered non-financial assets	   0	0	   0	0	   0	0	   0	0	
Total administered assets	0	   0	   0	   0	 711	 158	2,018	 534	
Administered liabilities (ii)									
Creditors and accruals	0	0	   0	0	(50)	(36)	(155)	(76)	
Unearned income 	   0	0	0	0	0	0	1	1	
Interest-bearing liabilities	0	0	0	0	0	0	0	0	
Other liabilities	0	0	0	0	0	0	0	1	
Total administered liabilities	   0	   0	   0	   0	(50)	(36)	(154)	(74)	
Total administered net assets	   0	   0	   0	   0	 761	 194	2,172	 608	

Note:
(i)	The state’s investment in all its controlled entities is disclosed in the administered note of DTF’s financial statements. This includes the investment in DELWP’s portfolio entities.
(ii)	DTF discloses the net liability related to defined benefit superannuation plans as an administered liability in its financial statements, on behalf of the state as the sponsoring employer. Refer to DTF’s financial statements for more detailed disclosures in relation to these plans.
(iii)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iv)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(v)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection. 

Note 3. Administered (non-controlled) items (continued)
(b) Administered assets and liabilities as at 30 June 2016 (continued)
	Effective Water Management and Supply	Local Government	Office of the Victorian Government Architect	Planning, Building and Heritage	Fire and Emergency Management						
	2016	2015	2016	2015 (iii)	2016 	2015 (iii)(iv)	2016	2015 (iii)	2016	2015	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Administered financial assets(i)											
Cash 	461	578	   0	30	   0	0	   0	1	262	350	
Receivables	80,655	56,287	   0	0	   0	0	   0	(150)	8,674	1,640	
Finance lease receivables	4,176,842	4,230,827	   0	0	   0	0	   0	0	0	0	
Total administered financial assets	4,257,958	4,287,692	   0	  30	   0	0	   0	(149)	8,936	1,990	
Administered non-financial assets											
Share of jointly controlled assets 	862,386	834,741	   0	0	   0	0	   0	0	   0	0	
Total administered non-financial assets	862,386	834,741	   0	0	   0	0	   0	0	   0	0	
Total administered assets	5,120,344	5,122,433	  0	  30	   0	0	0	(149)	8,936	1,990	
Administered liabilities (ii)											
Creditors and accruals	57,813	57,451	   0	0	   0	0	 331	0	(624)	(456)	
Unearned income 	23,701	27,521	   0	0	   0	0	   0	0	3	3	
Interest-bearing liabilities	4,173,804	4,227,629	   0	0	   0	0	   0	0	   0	0	
Other liabilities	0	3	   0	0	   0	0	   0	0	0	3	
Total administered liabilities	4,255,318	4,312,604	   0	0	   0	0	 331	0	(621)	(450)	
Total administered net assets	865,026	809,829	  0	30	   0	0	(331)	(149)	9,557	2,440	

Note:
(i)	The state’s investment in all its controlled entities is disclosed in the administered note of DTF’s financial statements. This includes the investment in DELWP’s portfolio entities.
(ii)	DTF discloses the net liability related to defined benefit superannuation plans as an administered liability in its financial statements, on behalf of the state as the sponsoring employer. Refer to DTF’s financial statements for more detailed disclosures in relation to these plans.
(iii)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33.Restructure of administrative arrangements for more information on the resulting transfers. 
(iv)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(v)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection 
Note 3. Administered (non-controlled) items (continued)
(b) Administered assets and liabilities as at 30 June 2015 (continued)
	Sustainably Manage Fish and Forest Resources	Management of Forests, Parks and Public Land	Land Victoria	Statutory Activities and Environmental Protection	Total						
	2016	2015 (iii)	2016	2015	2016	2015 (iii)	2016 (v)	2015	2016 (v)	2015 (iii) (iv)	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Administered financial assets(i)											
Cash 	0	0	150	230	0	3	0	0	1,018	1,362	
Receivables	   0	0	14,973	1,472	8,386	5,853	0	0	115,272	65,624	
Finance lease receivables	0	0	0	0	0	0	0	0	4,176,842	4,230,827	
Total administered financial assets	   0	   0	15,123	1,702	8,386	5,856	0	0	4,293,132	4,297,813	
Administered non-financial assets											
Share of jointly controlled assets 	   0	0	0	0	0	0	0	0	862,386	834,741	
Total administered non-financial assets	   0	0	0	   0	0	0	0	0	862,386	834,741	
Total administered assets	   0	 0	15,123	1,702	8,386	5,856	0	0	5,155,518	5,132,554	
Administered liabilities (ii)											
Creditors and accruals	   0	0	(101)	(1)	327	162	0	0	57,541	57,044	
Unearned income 	   0	0	6,757	6,786	90	57	0	0	30,552	34,368	
Interest-bearing liabilities	   0	0	0	0	0	0	0	0	4,173,804	4,227,629	
Other liabilities	0	0	0	27	0	0	0	0	   0	34	
Total administered liabilities	   0	   0	6,656	6,812	 417	 219	   0	   0	4,261,897	4,319,075	
Total administered net assets	   0	   0	8,467	(5,110)	7,969	5,637	   0	   0	893,621	813,479	

Note:
(i)	The state’s investment in all its controlled entities is disclosed in the administered note of DTF’s financial statements. This includes the investment in DELWP’s portfolio entities.
(ii)	DTF discloses the net liability related to defined benefit superannuation plans as an administered liability in its financial statements, on behalf of the state as the sponsoring employer. Refer to DTF’s financial statements for more detailed disclosures in relation to these plans.
(iii)	On 1 January 2015, the department relinquished its Agricultural, Biosecurity and Sustainably Manage Fish and Forest Resource outputs to DEDJTR. At the same time, the department assumed responsibility for the Land Victoria, Local Government, Office of the Victorian Government Architect and Planning, Building and Heritage outputs. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(iv)	On 15 May 2015, the department relinquished its Office of the Victorian Government Architect output to DPC. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 
(v)	The transfer of management and administration of the Sustainability Fund from EPA to the department on 1 July 2015 has resulted in a new output Statutory Activities and Environmental Protection
Note 3. Administered (non-controlled) items (continued)
(c) Investments in joint operation
The department has an investment in a joint operation, the Murray-Darling Basin Authority (MDBA) represented by the River Murray Operations and the Living Murray Initiative. 
On 3 July 2008, the Commonwealth Government and the Governments of New South Wales, Victoria, Queensland, South Australia and the Australian Capital Territory (the participants) entered into the Intergovernmental agreement for the Murray-Darling Basin Forms (the Reform IGA). The Reform involved the government participants entering into a new Murray-Darling Basin Agreement (MDB Agreement) and the Intergovernmental Agreement on Murray Darling Basin Reform – referral (the Referral IGA).
The MDB Agreement essentially dissolved the Murray-Darling Basin Commission (MDBC) and established the Murray-Darling Basin Authority (MDBA), Ministerial Council, Basin Officials Committee and the Basin Community Committee. Under the revised arrangement, the participants have a joint interest in the infrastructure assets and water rights. The State of Victoria’s interest in the arrangement is 26.67 percent.
The MDBA was established under the Commonwealth Water Act 2007 as an independent, expertise based statutory agency and is responsible for developing, implementing and monitoring the Basin Plans. The MDBA undertakes activities that support the sustainable and integrated management of the water resources of the Murray-Darling Basin in a way that best meets the social, economic and environmental needs of the Basin and its communities. 
Two unincorporated joint arrangements were established under the MDBA to hold the assets on behalf of the participants through separate agreements called the “Asset Agreement for River Murray Operations Assets” (RMO) and the “Further Agreement on Addressing Over Allocation and Achieving Environmental Objectives in the Murray-Darling Basin – Control and Management of Living Murray Assets” (LMI). The principal place of the operation is in Australia. The participants are obliged to provide funding to the MDBA for the management of the RMO and LMI assets and operations. 
The agreements in relation to the Murray-Darling Basin Agreement joint arrangement require unanimous consent from all parties for all relevant activities. The participants own the infrastructure assets and water rights of the joint arrangements which are being managed through the RMO and LMI and there are no liabilities held for either RMO or LMI. The arrangement is therefore classified as a joint operation and the department recognises, on behalf of the state,  its direct right to the jointly held assets, revenues and expenses based on the percentage interest as described in Note 1(k). 
			Ownership interest		
Name of entity	Principal activity	Country of incorporation	2016 %	2015 %	
River Murray Operations	To undertake activities that support the sustainable and integrated management of water resources of the Murray-Darling Basin.	Australia	26.67	26.67	
Living Murray Initiative	To undertake activities that support the sustainable and integrated management of water resources of the Murray-Darling Basin.	Australia	26.67	26.67	

(c) Investments in joint operation (continued)
Joint operations accounted for using the proportionate consolidation method
The department’s interest in assets, liabilities, income, and expenses employed in the above joint operations is detailed below. The amounts are included in the administered financial statements under their respective asset and liability categories.
	2016	2015	2016	2015	
	$’000	$’000	$’000	$’000	
	River Murray Operations	Living Murray Initiative			
Non-current assets 					
Property, plant and equipment	699,481	690,753	0	0	
Intangible assets	1,086	1,086	161,820	142,902	
Total non-current assets	700,567	691,839	161,820	142,902	
Total assets	700,567	691,839	161,820	142,902	
Income	2,917	6,064	18,917	29,298	
Expenses	10,493	11,551	0	1,087	

Contingencies and commitments
There are no contingencies or commitments arising from the department’s interest in the joint operation (2015: Nil).
(d) Leases
(i) Disclosures for lessees – finance lease liabilities
Commissioned public private partnership – Victorian Desalination Project
The State of Victoria entered into a 30-year Public Private Partnership (PPP) arrangement with the AquaSure consortium (AquaSure) on 30 July 2009. The Victorian Desalination Project was initiated to design, build and operate a desalination plant, transfer pipeline and 220 kV underground power cable capable of supplying 150 gigalitres of water per annum into the Melbourne network. Construction of the Victorian Desalination Project began in 2009 and the lease term commenced in 2012 upon successful commissioning. AquaSure is required to transfer the project assets to the state at the end of the project term for no additional payment by the state.
Under the arrangement, the state has an obligation to make Water Security Payments (WSPs) to the consortium provided the plant is maintained to the appropriate standard. The WSPs have two components: finance lease payments for the project assets (refer to table 3.1 below) and other expenses for operating, maintenance and lifecycle costs (refer to Note 3(e)(i) and Table 3.3).
The state will also make Water Usage Payments (WUPs) for any water that is ordered and delivered to the required standard. Water can be ordered annually for flexible amounts from 0 to 150 gigalitres (in set increments).
The state’s lease liability to AquaSure is offset by a sub-lease agreement between the department, on behalf of the state, and the Melbourne Water Corporation (refer to Note 3(d)(ii) and Table 3.2). Melbourne Water Corporation has recognised the finance lease asset.
The department does not control the income arising under this sub-lease and is required to pay receipts from the Melbourne Water Corporation into the state’s consolidated fund.  With consideration to the policy in Note 1(r), the department has classified the arrangement as administered.
In March 2016, AquaSure completed its third refinancing of a portion of its external debt with the approval of the state. The refinancing resulted in the state being entitled to a refinancing benefit of $56 million. Also in March, the Minister for Environment, Climate Change and Water announced an order of 50 billion litres of water to be delivered over the period 1 July 2016 to 30 June 2017. 
(d) Leases (continued)
Table 3.1: Victorian Desalination Project finance lease liability
	Minimum future lease payments	Present value of minimum future lease payments 			
	2016 $’000	2015 $’000	2016 $’000	2015 $’000	
Commissioned PPP related finance lease liabilities payable					
Not longer than one year	490,140	506,825	46,179	52,535	
Longer than one year but no later than five years	1,944,354	1,968,629	226,750	206,402 	
Longer than five years	8,975,420	9,496,698	3,900,875	3,968,692 	
Minimum future lease payments	11,409,914	11,972,152	4,173,804	4,227,629	
Less future finance charges	(7,236,110)	(7,744,523)	0	0	
Present value of minimum lease payments	4,173,804	4,227,629	4,173,804	4,227,629	
Included in administered liabilities as:					
Interest-bearing liabilities (Note 3 (b))			4,173,804	4,227,629	

(ii) Disclosures for lessors – finance lease receivables
Victorian Desalination Project sub-lease
A Statement of Obligations (SoO) issued to the Melbourne Water Corporation under section 4I of the Water Industry Act 1994 requires Melbourne Water Corporation to pay all monies payable by the state under the project deed with AquaSure. This arrangement gives rise to a finance lease receivable disclosed in Table 3.2. In addition, the project payments also include other commitments for operating, maintenance and lifecycle costs (refer to Note 3(e) and Table 3.3).
The department will transfer the Victorian desalination project assets to Melbourne Water Corporation at the end of the project contract term.
Table 3.2: Victorian Desalination Project finance lease receivable
	Minimum future lease payments	Present value of minimum future lease payments 			
	2016 $’000	2015 $’000	2016 $’000	2015 $’000	
Finance lease receivables					
Not longer than one year	490,140	506,825	46,342	52,695	
Longer than one year but not longer than five years	1,944,354	1,968,629	227,414	207,061	
Longer than five years	8,975,420	9,496,698	3,903,086	3,971,071	
Minimum future lease receivables	11,409,914	11,972,152	4,176,842	4,230,827	
Less unearned finance income	(7,233,072)	(7,741,325)	0	0	
Present value of minimum lease receivables	4,176,842	4,230,827	4,176,842	4,230,827	
Included in administered assets as:					
Finance lease receivables (Note 3 (b))			4,176,842	4,230,827	

(e) Commitments
(i) PPP related commitments – Victorian Desalination Project
Under the PPP arrangement that the state entered into with AquaSure (refer to Note 3(d)(i)) the state pays a base Water Security Payment, provided the plant is maintained to the appropriate standard, that includes other commitments for its operation, maintenance and lifecycle costs. The nominal amounts for the other commitments below represent the charges payable under the agreement at the end of the reporting period.
The Project Deed requires a minimum number of Renewable Energy Certificates (RECs) to be purchased to offset the electricity used by the plant. The number of RECs that are consumed will vary based on the volume of water produced by the plant. If there are any surplus RECs at the end of the project term, the Project Deed requires AquaSure to transfer them to the state, or sell them on arm’s length commercial terms on behalf of the state with all proceeds paid to the state. The department will transfer any surplus RECs or proceeds from sales thereof to the Melbourne Water Corporation at the end of the project contract term.
Table 3.3: Victorian Desalination Project PPP commitments
		2016		2015	
Commissioned PPP – other commitments					
	Other commitments	Other commitments			
	Present value	Nominal value	Present value	Nominal value	
	$’000	$’000	$’000	$’000	
Victorian Desalination Plant	1,587,009	4,762,138	1,562,438	4,959,549	
Total	1,587,009	4,762,138	1,562,438	4,959,549	

Note:
(i)	Refer to Note 3(d) for the finance lease liabilities for the Victorian Desalination Project. This note discloses only the other capital and operating and maintenance commitments for this project.
(ii)	Refer to Note 3(e)(ii) and (iii) where net values are disclosed at nominal values, exclusive of GST. 
(iii)	The present value of the ‘Other commitments’ have been discounted to 30 June of the respective financial years. The basis for discounting has been to take each 12 month period of cash flows and discount these cash flows at the end of the period using the annual discount rate. The discount rate used to present value the commitment is 9.99% which is the nominal pre-tax discount rate representative of the overall risk of the project at inception. 
(iv)	The ‘Other commitments’ have been updated to reflect indexation factors, such as Consumer Price Index, Producer Price Index, Chemical Index, and Average Weekly Earnings Index. Commitments are updated for the change in actual amounts paid, and forecast percentage increases are based on the original forecasted indices and applied to the adjusted actual payments. This methodology has been applied to reduce volatility in the forecast ‘Other commitments’.
(v)	Net additional costs associated with the announcement of the 50 billion litres of water have been reflected in commitments for 2016. 

(e) Commitments (continued)
(ii) Commitments payable
Table 3.4: Victorian Desalination Project PPP other commitments payable
	2016 $’000	2015 $’000	
PPP commitments payable – Victorian Desalination Project			
Other commitments			
Not longer than one year	155,854	124,209	
Longer than one year but not longer than five years	569,526	555,610	
Longer than five years	4,036,758	4,279,730	
Total PPP commitments for expenditure (inclusive of GST)	4,762,138	4,959,549	
Less GST recoverable from the Australian Taxation Office	(432,922)	(450,868)	
Total commitments for expenditure (exclusive of GST)	4,329,216	4,508,681	

(iii) Commitments receivable
Table 3.5: Victorian Desalination Project PPP other commitments receivable
	2016 $’000	2015 $’000	
PPP commitments receivable – Victorian Desalination Project			
Other commitments			
Not longer than one year	155,854	124,209	
Longer than one year but not longer than five years	569,526	555,610	
Longer than five years	4,036,758	4,279,730	
Total commitments receivable (inclusive of GST)	4,762,138	4,959,549	
Less GST payable to the Australian Taxation Office	(432,922)	(450,868)	
Total commitments receivable (exclusive of GST)	4,329,216	4,508,681	

(f) Financial instruments
(i) Financial risk management objectives and policies
The principal financial instruments the department administers on behalf of the state are the finance lease liability payable and finance lease asset receivable associated with the desalination plant.
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement, and the basis on which income and expenses are recognised, with respect to the classes of financial asset and financial liability above are disclosed in Note 1 to the financial statements.
The disclosures below relate exclusively to the Victorian Desalination Project.  Other administered financial instruments, such as receivables and payables, are not considered significant for the evaluation of the department’s financial position and performance with respect to administered items.  For disclosures concerning the department’s controlled financial instruments refer to Note 23. Financial instruments.
Table 3.6: Categorisation of financial instruments
 	2016	2015					
 	Contractual financial assets - loans and receivables $’000	Contractual financial liabilities at amortised cost $’000	Total $’000	Contractual financial assets - loans and receivables $’000	Contractual financial liabilities at amortised cost $’000	Total $’000	
 							
Contractual financial assets							
Finance lease receivable	4,176,842 	0   	4,176,842	4,230,827   	0	4,230,827   	
Contractual financial liabilities							
Finance lease liability	0  	4,173,804 	4,173,804	0 	4,227,629 	4,227,629	

Table 3.7: Net holding gain/(loss) on financial instruments by category
 	 	2016	 	2015	
 
 	Total interest income/(expense) $’000	Total $’000	Total interest income/(expense) $’000	Total $’000	
Contractual financial assets					
Finance lease receivable	452,383 	452,383	466,816	466,816	
Contractual financial liabilities	 	 	 		
Finance lease liability at amortised cost	 (452,544)	(452,544)	(466,974)	(466,974)	

(f) Financial instruments (continued)
(ii) Credit risk
Table 3.8: Credit quality of contractual financial assets that are neither past due nor impaired
 
 		2016		2015	
	Government agencies $’000	Total $’000	Government agencies  $’000	Total $’000	
Contractual financial assets	 	 	 		
Finance lease receivable	4,176,842 	4,176,842 	4,230,827	4,230,827	

Table 3.9: Ageing analysis of contractual financial assets
 
 	Carrying amount $’000	Not past due and not impaired $’000	Past due but not impaired					
			Less than 1 month $’000	2–3 months $’000	3 months– 1 year $’000	1–5 years $’000	5 years + $’000	
2016	 	 	 	 	 	 	 	
Finance lease receivable	4,176,842 	4,176,842	0	0	0	0	0	
2015	 	 	 	 	 	 	 	
Finance lease receivable	4,230,827	4,230,827	0	0	0	0	0	

(iii) Liquidity risk
Table 3.10: Maturity analysis of contractual financial liabilities
 
 	Carrying amount $’000	Nominal amount $’000	Maturity dates					
			Less than 1 month $’000	2–3 months $’000	3 months– 1 year $’000	1–5 years $’000	5 years + $’000	
2016	 	 	 	 	 	 	 	
Finance lease liability	4,173,804 	11,409,914 	42,081 	79,644 	368,415 	1,944,354 	8,975,420 	
2015	 	 	 	 	 	 	 	
Finance lease liability	4,227,629	11,972,152	43,079	82,037	381,709	1,968,629	9,496,698	

(iv) Market risk
The department’s exposures to market risk are primarily through interest rate risk. Objectives, policies and processes used to manage each of these risks are disclosed below.
Interest rate risk
The department’s interest bearing liabilities are managed by AquaSure. The interest rate risk is mitigated by hedging of the debt and bonds. Interest rates are fixed at the inception of the lease and refinancing options are subject to approval by the Minister for Finance. The department’s exposure to interest rate risk is set out in the Table 3.11.
(f) Financial instruments (continued)
Table 3.11: Interest rate exposure of financial instruments

 
 	 	 	2016	 	 	2015	
	 Weighted average interest rate %	  Carrying amount $’000	Interest rate exposure	 Weighted average interest rate %	  Carrying amount $’000	Interest rate exposure	
			Fixed interest rate $’000			Fixed interest rate $’000	
Financial assets	 	 	 	 	 	 	
Finance lease receivable	10.72	4,176,842 	4,176,842	10.77	4,230,827	4,230,827	
Financial liabilities	 	 	 	 	 	 	
Finance lease liability	10.73	4,173,804	4,173,804	10.78	4,227,629	4,227,629	

(v) Fair value
Table 3.12: Comparison between carrying amount and fair value
 	 	2016	 	2015	
	Carrying amount $’000	Fair value $’000	Carrying amount $’000	Fair value $’000	
Contractual financial assets					
Finance lease receivable	4,176,842 	4,176,842	4,230,827	4,230,827 	
Contractual financial liabilities 					
Finance lease liability	4,173,804	4,173,804	4,227,629	4,227,629 	

Note 4. Income from transactions
	2016 $’000	2015 $’000	
(a) Interest			
Interest from financial assets not at fair value through profit or loss:			
Interest on cash deposits and investments	19,067	6,867	
Total interest 	19,067	6,867	
(b) 	Sales of goods and services			
Rendering of services 	67,009	65,882	
Sales of goods and livestock	1,028	1,427	
Regulatory fees and charges	69	5,337	
Refunds and reimbursements	1,965	5,849	
Total sale of goods and services	70,071	78,495	
(c) 	Municipal and Industrial Landfill Levy			
Municipal and Industrial Landfill Levy	201,170	0	
Total Municipal and Industrial Landfill Levy	201,170	0	
(d) Metropolitan Parks Improvement Rate			
Metropolitan Parks Improvement Rate (i)	159,537	152,564	
Total Metropolitan Parks Improvement Rate	159,537	152,564	
(e) Grants 			
Specific purpose grants 	11,320	186,237	
General purpose grants	2,242	26,762	
Total grants	13,562	212,999	
(f)	 Fair value of services received free of charge or for nominal consideration:			
Assets at fair value	2	0	
Services at fair value	   3	64	
Total fair value of assets and services received free of charge or for nominal consideration	   5	  64	
(g) Other income			
Other miscellaneous income	2,252	11,341	
Total other income	2,252	11,341	

Note:
(i)	This rate commonly known as the ‘parks charge’ is an annual levy on all commercial and residential properties in the Melbourne and metropolitan areas. The Water Industry Act 1994 determines how the parks charge is to be levied and requires that money collected be spent on developing and managing open space, parks, waterways and bays within the metropolitan area for the purposes of conservation, recreation, leisure, tourism and navigation.
	The parks charge is paid into the Parks and Reserves Trust Account controlled by the department on behalf of the Minister for Energy, Environment and Climate Change. By agreement with the department, the parks charge is billed and collected by the three metropolitan retail water corporations and is paid directly into the trust account. For 2015-16 the minimum charge was levied at the rate of $72.56 (2015: $70.62) and the rate in the dollar of Net Annual Value was 0.435 cents (2015: 0.424 cents).
	During the 2015-16 financial year a total of $152.455 million was disbursed from the trust (in 2015, $164.851 million was disbursed for the full financial year) for the following purposes:
Parks Victoria
Zoological Parks and Gardens Board
Royal Botanic Gardens
Shrine of Remembrance
Purchase of public open space
Other projects approved by the Minister in line with the Water Industry Act 1994.
Note 5. Expenses from transactions
	2016 $’000	2015 $’000	
(a) Employee expenses			
Post-employment benefits			
	Defined contribution superannuation expense	(19,987)	(18,697) 	
	Defined benefit superannuation expense	(5,671)	(7,628)	
Termination benefits	(1,264)	(2,431)	
Salaries and wages	(278,139)	(279,213)	
Leave expenses (annual leave and long service leave)	(42,160)	(40,940) 	
Other on-costs (fringe benefits tax, payroll tax and workcover levy)	(16,454)	(20,832) 	
Total employee expenses	(363,675)	(369,741)	
(b) Depreciation			
Property, plant and equipment			
Buildings and structures	(13,653)	(20,566)	
Buildings leasehold improvements	(66)	(584)	
Motor vehicle finance lease assets	(7,309)	(9,553)	
Plant, machinery and equipment	(6,520)	(12,038)	
Roads 	(12,990)	(13,039)	
Historic and cultural assets	(22)	(22) 	
Total depreciation of property, plant and equipment	(40,560)	(55,802)	
Intangible assets			
Software and other intangible assets	(873)	(957)	
Total depreciation of intangible assets	(873)	(957)	
Total depreciation	(41,433)	(56,759)	
(c) Interest expense			
Interest on finance leases (i) 	(1,016)	(12,008)	
Other interest expense	34	14	
Total interest expense	(982)	(11,994)	
(d) Grants and other transfers 			
Grants to portfolio agencies	(354,001)	(270,376)	
Grants to catchment management authorities	(107,036)	(107,227)	
Grants to non-portfolio agencies	(28,088)	(24,049)	
Grants to the Commonwealth, other state, territory and local governments	(115,689)	(18,854)	
Grants to private individuals, businesses and non-profit organisations	(28,766)	(40,794)	
Other grants and transfers	(24)	(137)	
Total grants and other transfers	(633,604)	(461,437)	

Note:
(i)	Of the balance in ‘interest on finance leases’, nil (2015: $11.046 million) relates to assets contracted under the Royal Melbourne Showgrounds and Bioscience Research Centre PPP arrangements up to 31 December 2014. Effective 1 January 2015, both arrangements were transferred out of the department as a result of the Machinery of Government changes. Refer to Note 13. Property, Plant and Equipment, Note 17. Borrowings and Note 33. Restructure of administrative arrangements. 
Note 5. Expenses from transactions (continued)
	2016 $’000	2015 $’000	
(e) Supplies and services 			
Community awareness and publicity	(2,447)	(2,396)	
Contract and professional services	(252,335)	(239,718)	
Equipment maintenance and hire 	(42,759)	(41,294)	
General expenses	(97,238)	(17,379)	
Insurance expenses	(6,848)	(21,653)	
IT costs	(28,730)	(33,750)	
Laboratory, farm and livestock expenses	(3,086)	(8,615)	
Motor vehicle costs	(8,784)	(9,595)	
Office and accommodation	(40,181)	(47,299)	
Office expenses	(5,090)	(6,193)	
Payments for shared services	(15,867)	(21,570)	
Postage and telephone	(14,179)	(13,689)	
Travel and subsistence	(6,541)	(7,327)	
Total supplies and services	(524,085)	(470,478)	
(f) Other operating expenses			
Fair value of assets and services provided free of charge or for nominal consideration:			
Assets at fair value	(13)	(62)	
Services at fair value	(59)	(46)	
Total fair value of assets and services provided free of charge or for nominal consideration	(72)	(108)	
Operating lease rental expenses:			
Minimum lease payments - operating leases	(962)	(733)	
Total operating lease rental expenses	(962)	(733)	
Sub-total	(1,034)	(841)	
Cost of goods sold/distributed	(6,714)	(5,815)	
Ex-gratia payments (i)	(15)	(1)	
Research and development costs immediately expensed	(42)	(47)	
Settlement of litigation (ii)	(4,842)	94	
Total other operating expenses	(12,647)	(6,610)	

Note:
(i)	Refer to Note 27 Ex-gratia payments for more details. 
(ii)	2015–16 amounts predominantly related to the settlement of various land registry claims. In 2014–15 there was no settlement of litigation. The credit balance relates to a litigation over accrued in the previous year.

Note 6. Other economic flows included in net result
	2016 $’000	2015 $’000	
(a)	 Net gain/(loss) on non-financial assets 			
Net gain on disposal of property, plant and equipment	1,688	7,436	
Net recognition/(derecognition) of non-financial assets (Note 1(l))	(51,145)	4,117	
Adjustment to inventory	(32)	1,047	
Write-down of property, plant and equipment and intangible assets	(1,484)	(5,230)	
Total net gain/(loss) on non-financial assets 	(50,973)	7,370	
(b) 	Net gain/(loss) on financial instruments 			
Impairment of receivables (i)	(1,236)	(36)	
Net gain arising from the revaluation of financial assets at fair value – market risk	3,947	0	
Total net gain/(loss) on financial instruments	2,711	(36)	
(c) 	Share of net losses of associates, excluding dividends			
Share of net losses of associates, excluding dividends	(4,377)	(2,985)	
Total share of net losses of associates, excluding dividends	(4,377)	(2,985)	
(d) 	Other losses from other economic flows			
Loss from revaluation of investment in associates 	(2,021)	0	
Net loss arising from revaluation of employee benefits (ii)	(82)	(733)	
Other provision discount rate adjustments	(41)	(597)	
Total other losses from other economic flows	(2,144)	(1,330)	

Note:
(i)	This item represents the net increase in the provision for doubtful debts, the unilateral write off of bad debts and other debt from other economic flows – refer to Note 1(h).
(ii)	This item represents revaluation loss due to changes in bond rates.

Note 7. Receivables
	2016 $’000	2015 $’000	
Current receivables			
Contractual			
Trade receivables (i) (Note 23)	30,262	26,153	
Provision for doubtful contractual receivables (i) (Notes 7(a), 23)	(144)	(54)	
Accrued income (ii) (Note 23)	9,484	 1,946	
	39,602	28,045	
Statutory			
Amounts owing from Victorian Government (iii)	123,606	171,086	
Landfill levies receivable	97,248	0	
GST input tax credit recoverable 	6,020	17,913	
	226,874	188,999	
Total current receivables	 266,476	217,044	
Non-current receivables			
Contractual			
Amounts owing from Victorian Government (iii)	36,759	48,426	
Total non-current receivables	36,759	48,426	
Total receivables	303,235	265,470	

Note:
(i) The average credit period on sales of goods and services and for other receivables is 30 days. No interest is charged on trade debtors for the first 30 days from the date of the invoice. Thereafter, interest is charged at 9.5 per cent p.a. (2015: 9.5 per cent p.a.) on the outstanding balance of invoices relating to land licences. The interest rate is determined under the Penalty Interest Rate Act 1983. A provision has been made for estimated irrecoverable amounts from the sale of goods when there is objective evidence that an individual receivable is impaired. The movement in the allowance of $(90,000) (2015: $98,000) was recognised in the operating result for the current financial year.
(ii) No interest is charged on accrued receivables for the outstanding balance. An allowance is made for estimated irrecoverable amounts from the sale of goods, determined by reference to past default experience. No such allowance has been made in this financial year for accrued receivables.
(iii) The amounts recognised from Victorian Government represent funding for all commitments incurred through the appropriations and are drawn from the Consolidated Fund as the commitments fall due.

Note 7. Receivables (continued)
	2016 $’000	2015 $’000	
(a) Movement in the provision for doubtful debts			
Balance at 1 July	  54	152	
Reversal of unused provision recognised in the net result	(21)	0	
Reversal of provision of receivables written off during the year as uncollectible	0	(42)	
Increase in provision recognised in the net result	111	0	
Capital contributions to the Crown 	0	(56)	
Balance at 30 June	 144	  54	

(b) Ageing analysis of receivables
Refer to Table 23.3 in Note 23. Financial instruments for the ageing analysis of contractual receivables.
(c) Nature and extent of risk arising from receivables
Refer to Note 23. Financial instruments for the nature and extent of risks arising from contractual receivables.

Note 8. Investments and other financial assets

	2016 $’000	2015 $’000	
Current investments and other financial assets			
Term deposits:			
Australian dollar term deposits greater than three months (i)	243,190	20,100	
Total current investments and other financial assets	243,190	20,100	
Non-current investments and other financial assets			
Investment in managed fund (ii)(iii)	267,110	0	
Total non-current investments and other financial assets	267,110	   0	
Total investments and other financial assets	 510,300	20,100	

Note: 
(i)	Relates to trust fund term deposits held with the Treasury Corporation of Victoria. 
(ii)	The investment in managed fund transferred from the Environment Protection Authority to the department on 1 July 2015 as part of the transfer of management and administration of the Sustainability Fund.
(iii)	The investment represents funds invested in the Capital Stable Fund managed by the Victorian Funds Management Corporation. The Capital Stable Fund invests in a combination of asset classes which include cash deposits, fixed interest, Australian equities and global equities.

Note 9. Investments accounted for using the equity method
The department has an investment in an associate entity, Property Exchange Australia Limited (PEXA) (formerly known as National E-Conveyancing Development Limited). PEXA was established in January 2010 to develop a single national electronic conveyancing system for settling property transactions.
While the department’s ownership interest in PEXA is less than 20 per cent, it has significant influence through Victorian government representation on the Board of Directors and participation in policy making processes. 
On 1 July 2013, the investment in PEXA was transferred to the former Department of Transport, Planning and Local Infrastructure (DTPLI). On 1 January 2015, the investment was subsequently transferred back to the department. Refer to Note 33. Restructure of Administrative Arrangements for more information on the transfer.
On 1 July 2016, the investment transferred to the Department of Treasury and Finance. Refer to Note 34. Subsequent events for more information. 
Name of entity	Country of incorporation	Measurement method	Ownership interest	Fair value			
			2016 %	2015 %	2016 $’000	2015 $’000	
Non-current investments accounted for using the equity method							
Associate							
Property Exchange Australia Limited (i)	Australia	Equity method	9.02	11.56	11,349	9,199	
Total investments accounted for using the equity method		11,349	9,199				

Note:
(i) As at 30 June 2016, the fair value of the department’s interest in Property Exchange Australia Limited was $11.349 million (30 June 2015: $9.199 million), which is a level 3 input in terms of AASB 13 Fair Value Measurement.
Summarised financial information in respect of the department’s associate is set out below. The summarised financial information below represents amounts shown in the associate’s financial statements prepared in accordance with AASBs, adjusted by the department for equity accounting purposes.
	2016 $’000	2015 $’000	
Summarised balance sheet			
Current assets	82,822	28,321	
Non-current assets	50,663	57,071	
Total assets	133,485	85,392	
Current liabilities	7,376	5,667	
Non-current liabilities	285	146	
Total liabilities	7,661	5,813	
Net assets	125,824	79,579	
Share of associate’s net assets	11,349	9,199	
Summarised operating statement			
Total income from transactions	8,386	(1,704)	
Total expenses from transactions	(56,911)	24,116	
Net result	(48,525)	(25,820)	
Other economic flows – Other comprehensive income	0	0	
Total comprehensive income	(48,525)	(25,820)	
Share of associate’s comprehensive income	(4,377)	(2,985)	
 
	2016 $’000	2015 $’000	
Movements in carrying amount of interests in the associate			
Balance at 1 July	9,199	0	
Capital contributions from the Crown (Note 33)	0	12,029	
Share of associate’s net result 	(4,377)	(2,985)	
Loss from revaluation of investment in associates	(2,021)	0	
Share of associate’s movement in contributed capital	8,548	155	
Balance at 30 June	11,349	9,199	

Contingent liabilities and commitments
The department’s share of the commitments and contingent liabilities arising from its interest in associate are disclosed in Note 20. Leases, Note 21. Commitments for expenditure and Note 22. Contingent assets and contingent liabilities. 
Fair value measurement hierarchy for assets
	Carrying amount $’000	Fair value measurement at end of reporting period using:			
		Level 1 $’000	Level 2 $’000	Level 3 $’000	
Investments in associates at fair value					
At 30 June 2016					
Investments in associate	11,349	0	0	11,349	
At 30 June 2015					
Investments in associate	9,199	0	0	9,199	

Note 10. Investments in joint operations
On 1 July 2013, the department assumed responsibility for the Royal Melbourne Showgrounds and Biosciences Research Centre joint arrangements transferred from the former Department of Primary Industries. 
On 1 January 2015, the department relinquished its responsibility for the joint operations. Refer to Note 33. Restructure of administrative arrangement for more information on the resulting transfers. 
Royal Melbourne Showgrounds 
In October 2003, the state, represented by the former Department of Primary Industries entered into an agreement with the Royal Agricultural Society of Victoria Limited (RASV) to redevelop the Royal Melbourne Showgrounds. The agreement came into effect on 30 June 2005. Both the State and the RASV have a 50 percent interest in the joint arrangement.  
Two joint arrangement structures have been established, an unincorporated joint arrangement to carry out and deliver the project, and an incorporated joint arrangement entity, Showgrounds Nominees Pty Ltd, to hold the assets of the arrangement and to enter into agreements on behalf of the state and RASV. 
The state’s contribution to the arrangement was $100.7 million (expressed in 2004 dollars) while RASV contributed its freehold title to the showgrounds land valued at $51 million in June 2005. In June 2006, Showgrounds Nominees Pty Ltd entered into a Development and Operations Agreement (on behalf of the state and RASV) with the concessionaire, PPP Solutions (Showgrounds) Nominee Pty Ltd, to design, construct, finance and maintain the new facilities at the showgrounds. 
The principal place of the operations is Australia. The project operation term is 25 years from the date of commercial acceptance of completed works which occurred in August 2006. The project is being delivered under the Partnerships Victoria Policy framework.
The agreements in relation to the Royal Melbourne Showgrounds joint arrangement require unanimous consent from all parties for all relevant activities. Both the State and the RASV own the assets of the joint arrangement as tenants in common and are jointly and severally liable for the liabilities incurred by the partnership. The arrangement is therefore classified as a joint operation and all parties recognise its direct right to the jointly held assets, liabilities, revenues and expenses as described in Note 1(k). 
Biosciences Research Centre 
In April 2008, the State, represented by the former Department of Primary Industries entered into an agreement with La Trobe University (La Trobe) to establish a world class research facility at the University’s Melbourne campus in Bundoora. The State has a 75 percent interest in the joint arrangement. The facility is known as AgriBio, Centre for AgriBioscience. A similar structure to the Showgrounds joint arrangement has been adopted. It comprises an unincorporated arrangement to carry out and deliver the project, and an incorporated entity, Biosciences Research Centre Pty Ltd to hold the assets of the arrangement and to enter into agreements on behalf of the state and La Trobe. The principal place of the operations is Australia. 
The state’s contribution to the arrangement is $227.3 million, while La Trobe’s contribution is $60.4 million (both expressed in May 2009 dollars). 
On 30 April 2009, Biosciences Research Centre Pty Ltd entered into a Project Agreement (on behalf of the state and La Trobe) with Plenary Research Pty Ltd (the Concessionaire) to design, construct, finance and maintain the facility over the project’s operating term. The project’s operating term is 25 years from the date of commercial acceptance which occurred 18 July 2012. The project is being delivered under the Partnerships Victoria Policy framework.
The department pays the quarterly service payment in full each quarter as they fall due, with La Trobe reimbursing the state its agreed share. 
In addition, La Trobe contributes on a quarterly basis 25 percent of the general facilities management, maintenance and minor works costs associated with the services. 
In accordance with the agreement the participants are required to fund the administration expenses of the arrangement in equal shares of 50:50. 
The agreements establishing the Bioscience Research Centre joint arrangement require unanimous consent from all parties for all relevant activities. Both the State and the La Trobe own the Biosciences Research Centre facility as tenants in common and are jointly and severally liable for the liabilities incurred by the partnership. The arrangement is therefore classified as a joint operation and all parties recognise their direct right to the jointly held assets, liabilities, revenues and expenses based on its percentage interest in the operation as described in Note 1(k).  

Name of entity	Principal activity	Country of incorporation	Ownership interest		
			2016 %	2015 %	
Showground Nominees Pty Ltd	To carry out the redevelopment of the Royal Melbourne Showgrounds.	Australia	0	0	
Bioscience Research Centre Pty Ltd	To establish a world class research facility.	Australia	0	0	

Joint operations accounted for using the proportionate consolidation method
On 1 January 2015, the department relinquished its responsibility for the joint operations. Refer to Note 33. Restructure of administrative arrangement for more information on the resulting transfers. 
The department’s interest in assets, liabilities, income, and expenses employed in the above joint operations is detailed below. The amounts are included in the financial statements under their respective asset and liability categories.
Summarised financial information in respect of the department’s share of the investment in joint operations is set out below.
	2016 $’000	2015 $’000 (i)	
Royal Melbourne Showgrounds			
Total assets	0	0	
Total liabilities	0	0	
Income 	0	1,361	
Expenses 	   0	3,387	

Note:
(i)	The 2015 balance represents six months of income and expenses from 1 July to 31 December 2014, as the department relinquished its responsibility for the joint operation on 1 January 2015.     
	2016 $’000	2015 $’000 (i)	
Bioscience Research Centre			
Total assets	0	0	
Total liabilities	0	0	
Income	0	14,684	
Expenses	0	14,684	

Note:
(i)	The 2015 balance represents six months of income and expenses from 1 July to 31 December 2014, as the department relinquished its responsibility for the joint operation on 1 January 2015.   
Note 11. Inventories
	2016 $’000	2015 $’000	
Current inventories			
Supplies and consumables – at cost			
Fire stores	16,168	14,167	
Publications held for distribution	  30	  30	
Seed bank	3,084	2,593	
Weedicides	  60	43	
Other stores and materials	1,356	1,633	
	20,698	18,466	
Inventories held for distribution			
Publications held for sale – at cost	 335	 351	
Total inventories	21,033	18,817	

Note 12. Non-financial physical assets classified as held for sale
	2016 $’000	2015 $’000	
Non-financial physical assets classified as held for sale			
Land held for sale 	7,862	1,971	
Finance lease motor vehicles held for sale	 458	302	
Total non-financial physical assets classified as held for sale	8,320	2,273	

Land held for sale represents land deemed surplus to the needs of the State and sale is highly probable within the next 12 months.
Finance lease motor vehicles held for sale represent vehicles identified for immediate disposal in their current condition through the VicFleet disposal process.  It is anticipated that these disposals will be completed within the next 12 months.
Fair value measurement of non-financial physical assets classified as held for sale
Land held for sale is measured at the lower of carrying amount and fair value less costs to sell.
The market based direct comparison method is used to value land held for sale. Valuation of the land is determined by analysing comparable sales and allowing for share, size, topography, location and other relevant factors specific to the land being valued. 
Motor vehicles held for sale are carried at fair value less costs of disposal. 
Refer to Note 13. Property, plant and equipment for the valuation technique of motor vehicles under finance lease. 
The following table provides the fair value measurement hierarchy of the department’s non-financial physical assets held for sale. To the extent that non-financial physical assets classified as held for sale do not contain significant, unobservable adjustments, these assets are classified as Level 2 under the market approach. 
		Fair value measurement at end of reporting period using:			
	Carrying amount
$’000	Level 1
$’000	Level 2
$’000	Level 3
$’000	
2016					
Land held for sale	7,862	0	7,862	0	
Finance lease motor vehicles held for sale	 458	0	 458	0	
Total	8,320	0	8,320	0	

2015					
Land held for sale	1,971	0	1,971	0	
Finance lease motor vehicles held for sale	302	0	302	0	
Total	2,273	0	2,273	0	

Note 13. Property, plant and equipment
Classification by ‘purpose groups’ – carrying amounts (i)
	Public Safety and Environment 
(Table 13.1) 	Public Administration 
(Table 13.2) 	Total				
	2016	2015	2016	2015 (ii)	2016	2015	
	$’000	$’000	$’000	$’000	$’000	$’000	
Land 	6,595,004	5,648,084	195,628	167,894	6,790,632	5,815,978	
Buildings and structures 	583,124	495,651	6,198	6,681	589,322	502,332	
Roads	881,753	1,098,418	   0	0	881,753	1,098,418	
Plant and equipment	57,933	56,001	 481	445	58,414	56,446	
Assets under construction at cost	48,496	92,215	   0	5,503	48,496	97,718	
Historic and cultural assets	1,665	1,637	 857	866	2,522	2,503	
Net carrying amount of property, plant and equipment	8,167,975	7,392,006	203,164	181,389	8,371,139	7,573,395	

Note:
(i)	Property, plant and equipment are classified by the ‘purpose’ for which the assets are used, according to one of six purpose groups based upon government purpose classifications. All assets in a purpose group are further sub categorised according to the asset’s ‘nature’ (i.e. buildings, plant etc.), with each sub category being classified as a separate class of asset for financial reporting purposes.
(ii)	As a consequence of the Machinery of Government changes announced on 4 December 2014, property, plant and equipment under the Public Administration purpose group transferred to the department. Refer to Note 33. Restructure of administrative arrangements for more information on the transfers.
Gross carrying amounts and accumulated depreciation
	2016 $’000	2015 $’000	
Land			
Freehold land 			
At fair value 	201,772	185,583	
Total freehold land	201,772	185,583	
Crown land			
Land and unused roads at fair value 	2,698,564	2,285,876	
National parks at fair value	1,036,473	1,061,654	
State forests at fair value 	1,367,291	1,149,204	
Conservation reserves at fair value 	647,409	665,297	
Metropolitan parks at fair value 	751,659	334,272	
Land used for operational purposes at fair value	87,464	134,092	
Total Crown land 	6,588,860	5,630,395	
Total land	6,790,632	5,815,978	
Buildings and structures			
At fair value	597,189	562,133	
Less accumulated depreciation 	(7,867)	(59,801)	
Total buildings and structures	589,322	502,332	

Note 13. Property, plant and equipment (continued)
Gross carrying amounts and accumulated depreciation (continued)
	2016 $’000	2015 $’000	
Roads			
At fair value 	881,753	1,150,378	
Less accumulated depreciation	 0	   (51,960)	
Total roads	881,753	1,098,418	
Plant and equipment			
At fair value	106,405	104,367	
Less accumulated depreciation	(80,382)	(76,239)	
	26,023	28,128	
Motor vehicles under finance lease at fair value	47,987	42,902	
Less accumulated amortisation	(15,596)	(14,584)	
	32,391	28,318	
Total plant and equipment 	58,414	56,446	
Assets under construction at cost			
Buildings and structures	13,856	68,385	
Plant and equipment	34,640	29,333	
Total assets under construction at cost	48,496	97,718	
Historic and cultural assets			
At fair value	2,522	2,596	
Less accumulated depreciation	 0	(93)	
Total historic and cultural assets	2,522                                                                                               	2,503	
Total property, plant and equipment	8,371,139	7,573,395	

Note 13. Property, plant and equipment (continued) 
Table 13.1: Movements in carrying amounts – Classification by purpose group – ‘Public Safety and Environment’ 
	Freehold  land $’000	Land and unused roads $’000	National parks $’000	State  forests $’000	Conservation reserves $’000	Metropolitan parks $’000	Land used for operational purposes  $’000	Buildings and structures $’000	Roads $’000	Plant and equipment $’000	Assets under construction $’000	Historic and cultural assets $’000	Total $’000	
Balance at 1 July 2014 	0	2,326,263	1,066,284	1,135,484	664,630	311,250	385,206	801,170	1,005,903	91,478	124,793	1,678	7,914,139	
Additions	0	0	0	0	0	3,898	24,825 	773	228	22,905	57,839	0	110,468	
Disposals	0	0	0	0	0	0	0	(105)	0	(6,586)	0	0	(6,691)	
Reclassification to asset classified as held for sale (refer to Note 12)	0	(1,480)	0	0	0	0	0	0	0	(23)	0	0	(1,503)	
Net transfers in/(out) – free of charge	0	0	0	0	0	0	0	0	0	(62)	0	0	(62)	
Capital contributions (to)/from owners														
Transfers (to)/from other government entities	0	684	0 	0	0	0	0	0	0	(277)	0	0	 407	
Machinery of Government transfer in (Note 33)	0	0	0	0	0	0	0	9,970	0	1,320	1	0	11,291	
Machinery of Government transfer out (Note 33)	0	(34,581)	0	0	0	0	(238,404)	(327,153)	0	(35,497)	(40,917)	(23)	(676,575)	
Transfers to administered entity for disposal	0	(1,651)	0	0	0	0	(365)	(10,604)	(5,621)	(65)	0	0	(18,306)	
Transfers to third parties	0	669	0	0	0	0	0	0	0	0	0	0	 669	
Net transfers in/(out) – from other categories 	17,689	(9,384)	(4,630)	13,511	824	19,124	(37,135)	43,106	(25)	4,103 	(48,742)	0	(1,559)	
Revaluation increments/ (decrements)	0	675	0	0	0	0	0	0	110,972	0	0	0	111,647	
Recognition/(derecognition), (write-down) of assets 	0	4,681	0	209	(157)	0	(35)	(452)	0	214	(759)	0	3,701	
Depreciation expense (refer to Note 5(b))	0	0	0	0	0	0	0	(21,054)	(13,039)	(21,509)	0	(18)	(55,620)	
Balance at 1 July 2015	17,689	2,285,876	1,061,654	1,149,204	665,297	334,272	134,092	495,651	1,098,418	56,001	92,215	1,637	7,392,006	

Note: 
(i)	Refer to Note 35. Glossary of terms and style conventions for information about purpose groups.

Note 13. Property, plant and equipment (continued) 
Table 13.1: Movements in carrying amounts – Classification by purpose group – ‘Public Safety and Environment’ (continued)
	Freehold land $’000	Land and unused roads $’000	National parks $’000	State forests $’000	Conservation reserves $’000	Metropolitan parks $’000	Land used for operational purposes  $’000	Buildings and structures $’000	Roads $’000	Plant and equipment $’000	Assets under construction $’000	Historic and cultural  assets $’000	Total $’000	
Balance at 1 July 2015	17,689	2,285,876	1,061,654	1,149,204	665,297	334,272	134,092	495,651	1,098,418	56,001	92,215	1,637	7,392,006	
Additions	0	0	229	99	486	0	16,181 	2,447	0	16,221	31,940	0	67,603	
Disposals	0	(465)	0	0	0	0	0	(30)	(361)	(2,140)	0	0	(2,996)	
Reclassification to asset classified as held for sale (refer to Note 12)	0	(3,371)	0	0	0	0	0	0	0	(156)	0	0	(3,527)	
Net transfers in/(out) – free of charge	0	0	0	0	0	0	0	2	0	0	0	0	2	
Capital contributions (to)/from owners														
Transfers (to)/from other government entities	0	2,428	0 	0	0	0	(20,619)	0	0	0	6,330	0	(11,861)	
Transfers to administered entity for disposal	(78)	(15,919)	0	0	0	0	(3)	(8,430)	(279)	(207)	0	(28)	(24,944)	
Transfers to third parties	0	(84,444)	(250)	0	(4,968)	(168)	0	0	0	0	0	0	(89,830)	
Net transfers in/(out) – from other categories	(1,566)	(9,781)	3,541	11,718	14,544	23,500	(54,352)	78,287	0	1,250 	(80,298)	(5)	(13,162)	
Revaluation increments/ (decrements)	(15,063)	565,384	(28,701)	206,270	(13,475)	394,055	12,225	29,187	(203,026)	0	0	74	946,930	
Recognition/(derecognition), write-on/(write-down) of assets 	5,162	(41,144)	0	0	(14,475)	0	(60)	(409)	(9)	684	(1,691)	0	(51,942)	
Depreciation expense (refer to Note 5(b))	0	0	0	0	0	0	0	(13,581)	(12,990)	(13,720)	0	(13)	(40,304)	
Balance at 30 June 2016	6,144	2,698,564	1,036,473	1,367,291	647,409	751,659	87,464	583,124	881,753	57,933	48,496	1,665	8,167,975	

Note:
(i)	Refer to Note 35. Glossary of terms and style conventions for information about purpose groups.

Note 13. Property, plant and equipment (continued)
Table 13.1: Movements in carrying amounts – Classification by purpose group – ‘Public Administration’  
	Freehold land $’000	Land and unused roads $’000	National parks $’000	State forests $’000	Conservation reserves $’000	Metropolitan parks $’000	Land used for operational purposes  $’000	Buildings and structures $’000	Roads $’000	Plant and equipment $’000	Assets under construction $’000	Historic and cultural  assets $’000	Total $’000	
Balance at  1 July 2014	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Additions	0	0	0	0	0	0	0	0	0	152	0	0	 152	
Disposals	0	0	0	0	0	0	0	0	0	(28)	(1,720)	0	(1,748)	
Reclassification to asset classified as held for sale (refer to Note 12)	0	0	0	0	0	0	0	0	0	0	0	0	0	
Net transfers in/(out) – free of charge	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Capital contributions (to)/from owners														
Transfers (to)/from other government entities	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Machinery of Government transfer in (Note 33) (i)	122,416	0	0	0	0	0	0	6,170	0	403	58,122	870	187,981	
Machinery of Government transfer out (Note 33)	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Transfers to administered entity for disposal	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Transfers to third parties	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Net transfers in/(out) – from other categories	45,478	0	0	0	0	0	0	607	0	0 	(46,085)	0	   0	
Revaluation increments / (decrements)	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Recognition/(derecognition), write-on/(write-down) of assets	0	0	0	0	0	0	0	0	0	0	(4,814)	0	(4,814)	
Depreciation expense (refer to Note 5(b))	0	0	0	0	0	0	0	(96)	0	(82)	0	(4)	(182)	
Balance at 30 June 2015	167,894	   0	   0	   0	   0	   0	   0	6,681	   0	 445	5,503	 866	181,389	

Note:
(i)	As a consequence of the Machinery of Government changes announced on 4 December 2014, property, plant and equipment under the Public Administration purpose group transferred to the department. Refer to Note 33. Restructure of administrative arrangements for more information on the transfers. 
(ii)	Refer to Note 35. Glossary of terms and style conventions for information about purpose groups.

Note 13. Property, plant and equipment (continued)
Table 13.1: Movements in carrying amounts – Classification by purpose group – ‘Public Administration’  (continued)
	Freehold land $’000	Land and unused roads $’000	National parks $’000	State forests $’000	Conservation reserves $’000	Metropolitan parks $’000	Land used for operational purposes  $’000	Buildings and structures $’000	Roads $’000	Plant and equipment $’000	Assets under construction $’000	Historic and cultural  assets $’000	Total $’000	
Balance at  1 July 2015	167,894	0	0	0	0	0	0	6,681	0	445	5,503	866	181,389	
Additions	53	0	0	0	0	0	0	0	0	275	0	0	 328	
Disposals	0	0	0	0	0	0	0	0	0	(15)	0	0	(15)	
Reclassification to asset classified as held for sale (refer to Note 12)	(2,520)	0	0	0	0	0	0	0	0	0	0	0	(2,520)	
Net transfers in/(out) – free of charge	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Capital contributions (to)/from owners														
Transfers (to)/from other government entities	0	0	0	0	0	0	0	0	0	0	0	0	0	
Transfers to administered entity for disposal	(9,787)	0	0	0	0	0	0	(345)	0	0	0	0	(10,132)	
Transfers to third parties	0	0	0	0	0	0	0	0	0	0	0	0	   0	
Net transfers in/(out) – from other categories	17,899	0	0	0	0	0	0	0	0	(118) 	(5,503)	0	12,278	
Revaluation increments / (decrements)	22,089	0	0	0	0	0	0	0	0	0	0	0	   22,089	
Recognition/(derecognition), write-on/(write-down) of assets	0	0	0	0	0	0	0	0	0	3	0	0	   3	
Depreciation expense (refer to Note 5(b))	0	0	0	0	0	0	0	(138)	0	(109)	0	(9)	(256)	
Balance at 30 June 2016	195,628	0	0	0	0	0	0	6,198	0	 481	   0	 857	203,164	

Note:
(i)	Refer to Note 35. Glossary of terms and style conventions for information about purpose groups.

Note 13. Property, plant and equipment (continued) 
Table 13.2 Fair value measurement hierarchy for assets 
	Carrying amount $’000	Fair value measurement at  end of reporting period using:			
		Level 1 (i) $’000	Level 2 (i) $’000	Level 3 (i) $’000	
2016					
Land at fair value					
Non specialised land					
    Freehold land	195,628	0	195,628	0	
Specialised land					
    Freehold land	6,144	0	0	6,144	
    Crown land – Land and unused roads	2,698,564	0	0	2,698,564	
    Crown land – National parks	1,036,473	0	0	1,036,473	
    Crown land – State forests	1,367,291	0	0	1,367,291	
    Crown land – Conservation reserves	647,409	0	0	647,409	
    Crown land – Metropolitan parks	751,659	0	0	751,659	
    Crown land – Land used for operational purposes	87,464	0	0	87,464	
Buildings and structures at fair value					
Non specialised buildings and structures	6,198	0	6,198	0	
Specialised buildings and structures	583,124	0	0	583,124	
Roads at fair value					
Roads	881,753	0	0	881,753	
Plant and equipment at fair value					
Plant and equipment 	26,023	0	0	26,023	
Motor vehicles under finance lease	32,391	0	32,391	0	
Historic and cultural assets at fair value					
Artwork and historic assets	2,522	0	2,522	0	
2015					
Land at fair value					
Non specialised land					
    Freehold land	167,894	0	167,894	0	
Specialised land					
    Freehold land	17,689	0	0	17,689	
    Crown land – Land and unused roads	2,285,876	0	0	2,285,876	
    Crown land – National parks	1,061,654	0	0	1,061,654	
    Crown land – State forests	1,149,204	0	0	1,149,204	
    Crown land – Conservation reserves	665,297	0	0	665,297	
    Crown land – Metropolitan parks	334,272	0	0	334,272	
    Crown land – Land used for operational purposes	134,092	0	0	134,092	
Buildings and structures at fair value					
Non specialised buildings and structures	6,681	0	6,681	0	
Specialised buildings and structures	495,651	0	0	495,651	
Roads at fair value					
Roads	1,098,418	0	0	1,098,418	
Plant and equipment at fair value					
Plant and equipment 	28,128	0	0	28,128	
Motor vehicles under finance lease	28,318	0	28,318	0	
Historic and cultural assets at fair value					
Artwork and historic assets	2,503	0	2,503	0	

Note: 
(i)	Classified in accordance with the fair value hierarchy, refer to Note 1(b). 
Assets under construction are excluded from the table above. 
The measurement and classification of each class of property, plant and equipment is outlined below. The property, plant and equipment transferred to the department as a consequence of Machinery of Government changes have been incorporated. There have been no transfers between levels during the period for existing property, plant and equipment. 
Non specialised land and buildings
Non specialised land and buildings are valued using the market approach. Under this method, the assets are compared to recent comparable sales or sales of comparable assets which are considered to have nominal or no added improvement value. For the sales analysed, an appropriate rate per square metre has been applied to the subject asset.
The department’s non specialised land and buildings relates to the Public Administration Purpose Group and will be independently revalued at 30 June 2017.
A managerial revaluation was performed on non specialised land at 30 June 2016 as the fair value assessment indicated a material difference between fair value and the carrying value of the land. No revaluation was performed on buildings as the difference in value was immaterial. The effective valuation date of the buildings was 30 June 2012.
To the extent that non-specialised land and buildings do not contain significant, unobservable adjustments, these assets are classified as Level 2 under the market approach.  
Specialised land 
The market based direct comparison method is used for specialised land although it is adjusted for a community service obligation (CSO) to reflect the specialised nature of the land being valued. 
Valuation of the land was determined by analysing comparable sales and allowing for share, size, topography, location and other relevant factors specific to the land being valued. 
The CSO adjustment is a reflection of the valuer’s assessment of the impact of restrictions associated with an asset to the extent that is also equally applicable to market participants. This approach is in light of the highest and best use consideration required for fair value measurement, and takes into account the use of the asset that is physically possible, legally permissible, and financially feasible. As adjustments of CSO are considered as significant unobservable inputs, specialised  land is classified as Level 3 assets.
An independent valuation of the department’s specialised land was performed by the Valuer-General Victoria. The valuation was performed using the market approach adjusted for CSO. The effective date of the valuations was  30 June 2016. 
Specialised buildings and structures
For the department’s majority of specialised buildings, the depreciated replacement cost method is used, adjusting for the associated depreciation. As depreciation adjustments are considered as significant, unobservable inputs in nature, specialised buildings are classified as Level 3 fair value measurements.
An independent valuation of the department’s specialised buildings was performed by the Valuer-General Victoria. The valuation was performed using the depreciated replacement cost method. The effective date of the valuations was 30 June 2016. 
Structures are valued using the depreciated replacement cost method. This cost represents the replacement cost of the component after applying depreciation rates on a useful life basis. Replacement costs relate to costs to replace the current service capacity of the asset.   
Where it has not been possible to examine hidden works, the use of reasonable materials and methods of construction have been assumed bearing in mind the age and nature of the structures. The estimated cost of reconstruction includes structure services and finishes. 
An independent valuation of the department’s structures was performed by the Valuer-General Victoria. The valuation was performed based on the depreciated replacement cost of the assets. The effective date of the valuations was 30 June 2016. 
Roads 
Roads are valued using the depreciated replacement cost method. This cost represents the replacement cost of the component after applying depreciation rates on a useful life basis. Replacement costs relate to costs to replace the current service capacity of the asset.   
Where it has not been possible to examine hidden works, the use of reasonable materials and methods of construction have been assumed bearing in mind the age and nature of the roads. The estimated cost of reconstruction includes structure services and finishes.  
An independent valuation of the department’s roads was performed by the Valuer-General Victoria as at 30 June 2016. The valuation was performed based on the depreciated replacement cost of the assets. 
Plant and equipment
Plant and equipment is held at fair value. When plant and equipment is specialised in use, such that it is rarely sold other than as part of a going concern, fair value is determined using the depreciated cost method. Given valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable, these assets are classified as Level 3.
Motor vehicles under finance lease
Motor vehicles are valued using the market approach. Under this valuation method, the vehicles are compared to recent comparable sales. To the extent that motor vehicles under finance lease have an exit price prescribed by the lessor at the start of the lease term, these assets are classified as Level 2 under the market approach.
Historic and cultural assets
Artwork and historic assets are valued using the market approach. Under this valuation method, the historic and cultural assets are determined by a comparison to similar examples of the artist’s work in existence throughout Australia and research on prices paid for similar examples offered at auction or through art galleries in recent years. 
To the extent that artwork and historic assets do not contain significant, unobservable adjustments, these assets are classified as Level 2 under the market approach.
An independent valuation of the department’s artwork and historic assets was performed by the Valuer-General Victoria. The effective date of the valuations was 30 June 2012 for historic and cultural assets under the Public Administration Purpose Group and 30 June 2016 for the Public Safety and Environment Purpose Group.
There were no changes in valuation techniques throughout the period to 30 June 2016. 
For all assets measured at fair value, the current use is considered the highest and  best use.

Note 13. Property, plant and equipment (continued) 
Table 13.3: Reconciliation of Level 3 fair value
	Freehold land $’000	Land and unused  roads $’000	National parks $’000	State forests $’000	Conservation reserves $’000	Metropolitan parks $’000	Land used for operational purposes  $’000	Buildings and structures $’000	Roads $’000	Plant and equipment $’000	Total $’000	
Balance at 1 July 2014 	0	2,326,263	1,066,284	1,135,484	664,630	311,250	385,206	801,170	1,005,903	53,531	7,749,721	
Purchases/(sales)	0	0	0	0	0	3,898	24,825 	668	228	6,612	36,231	
Transfers in/(out) of Level 3 – assets classified as held for sale (Note 12)	0	(1,480)	0	0	0	0	0	0	0	0	(1,480)	
Transfers in/(out) – from other categories (i)	17,689	(9,384)	(4,630)	13,511	824	19,124	(37,135)	43,106	(25)	3,028	46,108	
Depreciation expense	0	0	0	0	0	0	0	(21,054)	(13,039)	(12,038)	(46,131)	
	17,689	2,315,399	1,061,654	1,148,995	665,454	334,272	372,896	823,890	993,067	51,133	7,784,449	
Gains/(losses) recognised in net result												
Recognition/(derecognition), write-on/(write-down) of assets	0	4,681	0	209	(157)	0	(35)	(452)	0	226	4,472	
	   0	4,681	   0	 209	(157)	   0	(35)	(452)	   0	 226	4,472	
Gains/(losses) recognised in other economic flows – other comprehensive income												
Revaluation increments/(decrements)	0	675	0	0	0	0	0	0	110,972	0	111,647	
	   0	 675	   0	   0	   0	   0	   0	   0	110,972	   0	111,647	
Transfers in/(out) through contributions by owner												
Transfers in/(out) – Machinery of Government transfers	0	(34,581)	0	0	0	0	(238,404)	(317,183)	0	(23,152)	(613,320)	
Transfers in/(out) – other capital contributions	0	(298)	0	0	0	0	(365)	(10,604)	(5,621)	(79)	(16,967)	
	   0	(34,879)	   0	   0	0	   0	(238,769)	(327,787)	(5,621)	(23,231)	(630,287)	
Balance at 30 June 2015	17,689	2,285,876	1,061,654	1,149,204	665,297	334,272	134,092	495,651	1,098,418	28,128	7,270,281	
 Note:
(i) Net transfers from assets under construction. 
Assets under construction are excluded from table 13.3.
 Note 13. Property, plant and equipment (continued) 
Table 13.3: Reconciliation of Level 3 fair value (continued)
	Freehold land $’000	Land and unused  roads $’000	National parks $’000	State forests $’000	Conservation reserves $’000	Metropolitan parks $’000	Land used for operational purposes  $’000	Buildings and structures $’000	Roads $’000	Plant and equipment $’000	Total $’000	
Balance at 1 July 2015	17,689	2,285,876	1,061,654	1,149,204	665,297	334,272	134,092	495,651	1,098,418	28,128	7,270,281	
Purchases/(sales)	0	(466)	229	99	486	0	16,181	2,417	(361)	2,803	21,383	
Transfers in/(out) of Level 3 – assets classified as held for sale (Note 12)	0	(3,371)	0	0	0	0	0	0	0	0	(3,371)	
Transfers in/(out) – free of charge	0	0	0	0	0	0	0	2	0	0	   2	
Transfers in/(out) – from other categories (i)	(1,566)	(9,781)	3,541	11,718	14,544	23,500	(54,352)	78,287	0	1,132	67,023	
Depreciation expense	0	0	0	0	0	0	0	(13,581)	(12,990)	(6,520)	(33,091)	
	16,123	2,272,258	1,065,424	1,161,021	680,327	357,772	95,921	562,776	1,085,067	25,543	7,322,232	
Gains/(losses) recognised in net result												
Recognition/(derecognition), (write-down) of assets 	5,162	(41,144)	0	0	(14,475)	0	(60)	(409)	(9)	687	(50,248)	
	5,162	(41,144)	   0	   0	(14,475)	   0	(60)	(409)	(9)	 687	(50,248)	
Gains/(losses) recognised in other economic flows – other comprehensive income												
Revaluation increments/ (decrements)	(15,063)	565,385	(28,701)	206,270	(13,475)	394,055	12,225	29,187	(203,026)	0	946,857	
	(15,063)	565,385	(28,701)	206,270	(13,475)	394,055	12,225	29,187	(203,026)	   0	946,857	
Transfers in/(out) through contributions by owner												
Transfers in/(out) – Machinery of Government transfers	0	0	0	0	0	0	0	0	0	0	   0	
Transfers in/(out) – other capital contributions	(78)	(97,935)	(250)	0	(4,968)	(168)	(20,622)	(8,430)	(279)	(207)	(132,937)	
	(78)	(97,935)	(250)	0	(4,968)	(168)	(20,622)	(8,430)	(279)	(207)	(132,937)	
Balance at 30 June 2016	6,144	2,698,564	1,036,473	1,367,291	647,409	751,659	87,464	583,124	881,753	26,023	8,085,904	
 Note:
(i) Net transfers from assets under construction. 
Assets under construction are excluded from table 13.3. 

Note 13. Property, plant and equipment (continued) 
Table 13.4: Description of significant unobservable inputs to Level 3 valuations
Asset class	Valuation technique 	Significant Unobservable Inputs 	
Specialised land	Market approach	Community Service Obligation (CSO) adjustment 	
Specialised buildings	Depreciated replacement cost   	Direct cost per square metre
Useful life of specialised buildings	
Specialised structures	Depreciated replacement cost 	Cost per structure
Useful life of specialised structures	
Roads 	Depreciated replacement cost 	Cost per km
Useful life of roads	
Plant and equipment	Depreciated replacement cost   	Cost per unit
Useful life of plant and equipment	

Note 14. Biological assets
	2016	2015	
Breeding livestock – sheep and cattle (by headcount)	0	0	

Reconciliation of carrying amount
	2016 $’000	2015 $’000	
Movements in carrying amounts of breeding livestock			
Balance at 1 July	0	1,845	
Capital contributions to the Crown (Note 33)	0	(1,845)	
Balance at 30 June	   0	0	

The department recognised breeding livestock as biological assets. 
On 1 January 2015, the breeding stock transferred out of the department as a result of Machinery of Government changes. Refer to Note 33. Restructure of administrative arrangements for more information on the resulting transfers. 

Note 15. Intangible assets
	2016 $’000	2015 $’000	
Software			
At cost 	17,028	17,062	
Less accumulated depreciation 	(10,562)	(9,752)	
Less accumulated impairment	   0	0	
	6,466	7,310	
Construction in progress – at cost	22,907	19,732	
Total software	29,373	27,042	
Total intangible assets	29,373	27,042	

Depreciation of intangible assets
Capitalised expenditure on intangible assets, such as databases and software, is depreciated on a straight-line basis over an estimated useful life of between three and 10 years.
Aggregate depreciation allocated during the year is recognised as an expense and disclosed in Note 5(b) to the financial statements. 
Significant intangible assets 
The department has software development expenditure for a number of systems.  The major component of the carrying amount of software is the Fire and Emergency Management Portal under development. The expected cost of the system is $21.50 million and is anticipated to be completed in December 2016. 
	2016 $’000	2015 $’000	
Movements in carrying amounts			
Balance at 1 July	27,042	55,803	
Additions	3,010	5,642	
Capital contributions to the Crown (Note 33)	0	(35,005)	
Net transfers from other categories (Note 13)	884	1,559	
Recognition/(derecognition), write-on/(write-down) of assets	(690)	0	
Depreciation expense (i)	(873)	(957)	
Balance at 30 June	29,373	27,042	

Note:
(i)	Depreciation expense is included in the line item ‘depreciation’ in the comprehensive operating statement.

Note 16. Payables
	2016 $’000	2015 $’000	
Current payables			
Contractual			
Trade creditors (i)	16,061	32,501	
Accrued grants and other transfers	18,501	3,090	
Capital accruals 	24,273	22,809	
Other accrued expenses	30,779	29,393	
Other payable (i)	3,029	2,588	
	92,643	90,381	
Statutory 			
Advance from the Public Account (ii)	10,556	21,773	
Taxes payables	2,304	2,392	
	12,860	24,165	
Total current payables	105,503	114,546	
Non-current payables			
Statutory			
Advance from the Public Account (ii)	6,500	12,400	
	6,500	12,400	
Total non-current payables	6,500	12,400	
Total payables 	112,003	126,946	

Note:
(i) The average credit period is 30 days. No interest is charged on the trade creditors or other payables for the first 30 days from the date of the invoice. Thereafter, interest may be charged at differing rates determined by the individual trade arrangements entered into.
(ii) These advances are for varying terms and do not normally bear interest.  The advances are unsecured and the term of the advance is usually agreed by the Minister at the time the advance was provided.
(a) Maturity analysis of contractual payables
Refer to Table 23.4 in Note 23. Financial instruments for the maturity analysis of contractual payables.
(b) Nature and extent of risk arising from contractual payables
Refer to Note 23. Financial instruments for the nature and extent of risks arising from contractual payables.

Note 17. Borrowings
	2016 $’000	2015 $’000	
Current borrowings – secured (i)			
Non-PPP related finance lease liabilities – Motor vehicles	14,380	10,052	
Total current borrowings	14,380	10,052	
Non-current borrowings – secured (i)			
Non-PPP related finance lease liabilities – Motor vehicles	18,339	18,819	
Total non-current borrowings	18,339	18,819	
Total borrowings	32,719	28,871	

Note:
(i)	Secured by the leased assets.
(a) Maturity analysis of borrowings
Refer to Table 23.4 in Note 23. Financial instruments for the maturity analysis of borrowings.
(b) Nature and extent of risk arising from borrowings
Refer to Note 23. Financial instruments for the nature and extent of risks arising from borrowings.
(c) Defaults and breaches
During the current and prior year, there were no defaults and breaches of any of the loans.

Note 18. Provisions
	2016 $’000	2015 $’000	
Current provisions 			
Employee benefits – annual leave (i) (Note 18(a))			
Unconditional and expected to settle within 12 months 	27,428	21,901	
Unconditional and expected to settle after 12 months (iii)	712	 3,442	
Employee benefits – long service leave (i) (Note 18(a))			
Unconditional and expected to settle within 12 months 	52,711	39,765	
Unconditional and expected to settle after 12 months (iii)	15,303	20,690	
	96,154	85,798	
Provisions for on-costs: (Notes 18(a) and 18(b))			
Unconditional and expected to settle within 12 months 	12,670	9,945	
Unconditional and expected to settle after 12 months (iii)	2,532	3,954	
	15,202	13,899	
Onerous lease contracts (ii) (Notes 18(b) and 20)	 594	726	
Provision for insurance deductibles (Note 18(b))	501	3,428	
Provision for fire rehabilitation (Note 18(b))	562	810	
Provision for native vegetation offset (Note 18(b))	860	610	
Provision for flood recovery works (Note 18(b))	 146	151	
Provision for legal settlements (Note 18(b))	2,347	0	
Other (Note 18(b))	1,899	2,727	
Total current provisions	118,265	108,149	
Non-current provisions 			
Employee benefits (i)(iii) (Note 18(a))	6,585	7,190	
On-costs (iii) (Note 18(a) and 18(b))	1,041	1,166	
Onerous lease contracts (ii) (Notes 18(b) and 20)	813	672	
Provision for insurance deductibles (iv) (Note 18(b)) 	6,121	15,475	
Provision for fire rehabilitation (iv) (Note 18(b)) 	962	1,043	
Provision for native vegetation offset (iv) (Note 18(b)) 	2,598	3,345	
Other (iv) (Note 18(b))	300	716	
Total non-current provisions	18,420	29,607	
Total provisions	136,685	137,756	

Note:
(i)	Provisions for employee benefits consist of amounts for annual leave and long service leave accrued by employees, not including on-costs.
(ii)	The provision for onerous lease contracts represents the present value of the future lease payments that the department is presently obligated to make in respect of onerous lease contracts under non-cancellable operating lease agreements, less income expected to be earned on the lease including estimated future sub-lease income, where applicable. The estimate may vary as a result of changes in the utilisation of the leased premises and sub-lease arrangements where applicable. The unexpired terms of the leases vary up to a maximum of 15 years.
(iii)	The amounts disclosed are discounted to present values.
(iv)	A review of provision movement patterns was undertaken during the year. The review identified not all of the provision would be utilised within the next 12 months. This resulted in reclassification of part of the provision to non-current. As the reclassification is not considered significant, re-statement of comparatives is not required under AASB 101 Presentation of Financial Statements.  
Note 18. Provisions (continued)
(a) Employee benefits and related on-costs
	2016 $’000	2015 $’000	
Current employee benefits (i)			
Annual leave entitlements (iii)	28,140	25,343	
Long service leave entitlements (iii)	68,014	60,455	
	96,154	85,798	
Non current employee benefits (i)			
Long service leave entitlements (iii)	6,585	7,190	
Total employee benefits	102,739	92,988	
Current on-costs	15,202	13,899	
Non current on-costs (iii)	1,041	1,166	
Total on-costs	16,243	15,065	
Total employee benefits and related on-costs	118,982	108,053	

Note:
(i)	Provisions for employee benefits consist of amounts for annual leave and long service leave accrued by employees, not including on-costs.
(ii)	The provision for onerous lease contracts represents the present value of the future lease payments that the department is presently obligated to make in respect of onerous lease contracts under non-cancellable operating lease agreements, less income expected to be earned on the lease including estimated future sub-lease income, where applicable. The estimate may vary as a result of changes in the utilisation of the leased premises and sub-lease arrangements where applicable. The unexpired term of the leases vary up to a maximum of 15 years.
(iii)	The amounts disclosed are discounted to present values.

Note 18. Provisions (continued)
(b) Movement in provisions
	On-costs $’000	Onerous lease contracts $’000	Insurance deductibles $’000	Fire rehabilitation $’000	Native vegetation offset $’000	Flood recovery works $’000	Legal settlements $’000	Other $’000 	Total $’000	
Balance at 1 July 	15,065	1,398	18,903	1,853	3,955	151	0	3,443	44,768	
Additional provisions recognised	3,284	33	0	0	0	0	2,347	0	5,664	
Reductions arising from payments/other sacrifices of future economic benefits	(1,919)	9	(12,283)	(329)	(497)	(3)	0	(1,244)	(16,266)	
Increase/(reductions) resulting from re measurement or settlement without cost 	(174)	0	2	0	0	(2)	0	0	(174)	
Unwind of discount and effect of changes in the discount rate	(13)	(33)	0	0	0	0	0	0	(46)	
Balance at 30 June 	16,243	1,407	6,622	1,524	3,458	 146	2,347	2,199	33,946	
										
Current 	15,202	 594	501	 562	860	 146	2,347	1,899	22,111	
Non-current 	1,041	813	6,121	962	2,598	0	0	300	11,835	
	16,243	1,407	6,622	1,524	3,458	 146	2,347	2,199	33,946                                                                                                                                               	

Note 19. Superannuation
Government Employees’ Superannuation Fund
Employees of the department are entitled to receive superannuation benefits and the department contributes to both defined benefit and defined contribution plans. The defined benefit plan provides benefits based on years of service and final average salary.
The department does not recognise any defined benefit liability in respect of the plan because the department has no legal or constructive obligation to pay future benefits relating to its employees; its only obligation is to pay superannuation contributions as they fall due. DTF discloses the state’s defined benefit liabilities in its disclosure for administered items.
However, superannuation contributions paid or payable for the reporting period are included as part of employee benefits in the comprehensive operating statement of the department.
The name, details and amounts expensed in relation to the major employee superannuation funds and contributions made by the department are as follows:
	Paid contribution  for the year	Contribution outstanding  at year end			
Fund	2016 $’000	2015 $’000	2016 $’000	2015 $’000	
Defined benefit plans:					
Emergency Services Superannuation Scheme	5,558	7,543	113	85	
Defined contribution plans:					
Victorian Superannuation Fund – Vic Super Scheme	14,860	13,717	283	162	
Various other 	4,747	4,763	97	55	
Total superannuation contributions	25,165	26,023	 493	302	

Note:
•	The bases for contributions are determined by the various schemes.
•	All employees of the department are entitled to varying levels of benefits on retirement, disability or death.  Some superannuation plans provide defined benefits based on years of service and final average salary. The others are classified as contribution schemes. Contributions by the department of a minimum of  9.50 per cent (2015: 9.50 per cent) of employee’s wages and salaries are legally enforceable on the department.
•	The above amounts were measured as at 30 June of each year or in the case of employer contributions they relate to the years ended 30 June.

Note 20. Leases
Disclosures for lessee – finance leases liabilities
Leasing arrangements – Motor vehicles
The finance leases relate to motor vehicles leased through the VicFleet lease facility. The lease term is the period over which the vehicle is to be leased. Generally, vehicles must be retained for three years or 60 000 kilometres, whichever occurs first. On disposal of the vehicle any profit or loss on sale is borne by the department. The weighted average interest rate implicit in the leases is 4.82 per cent p.a. (2015: 5.31 per cent p.a.). 
	Minimum future lease payments	Present value of minimum future lease payments			
	2016 $’000	2015 $’000	2016 $’000	2015 $’000	
Motor vehicle related finance leases liabilities payable					
Not longer than one year	15,507	11,137	14,380	10,052	
Longer than one year but not longer than five years	19,470	19,860	18,339	18,819	
Minimum future lease payments	34,977	30,997	32,719	28,871	
Less future finance charges	(2,258)	(2,126)	0	0	
Present value of minimum lease payments	32,719	28,871	32,719	28,871	
Included in the financial statements as:					
Current finance lease liability (Note 17)			14,380	10,052	
Non-current finance lease liability (Note 17)			18,339	18,819	
Total lease liabilities			32,719	28,871	

The finance leases disclosed below are exempt from GST.
a) Maturity analysis of finance lease liabilities
Please refer to Table 23.4 in Note 23. Financial instruments for the maturity analysis of finance lease liabilities.
(b)	 Nature and extent of risk arising from finance lease liabilities
Please refer to Note 23. Financial instruments for the nature and extent of risks arising from finance lease liabilities.

Note 20. Leases (continued)
Disclosures for lessee – operating leases
Operating leases predominantly relate to office and other facilities with lease terms of between two to 15 years, some with options to extend the lease. Some operating lease contracts contain annual market review clauses. 
Other leases consist mainly of aircraft leases relating to fire bombing services.  Such leases have terms between one to five years.
The department does not have an option to purchase the leased assets at the expiry of the lease period.
All amounts shown in the leases note are nominal amounts.
	2016 $’000	2015 $’000	
Non-cancellable operating leases payable			
Not longer than one year	23,976	21,607	
Longer than one year but not longer than five years	19,214	24,875	
Longer than five years	275	70	
Total commitment for operating leases (inclusive of GST)	43,465	46,552	
Less GST recoverable from the Australian Taxation Office	(3,951)	(4,232)	
Total commitments for operating lease expenditure	39,514	42,320	

In respect of non-cancellable operating leases the following liabilities have been recognised:			
Current			
Onerous lease contracts (Note 18)	 594	726	
Non-current			
Onerous lease contracts (Note 18)	813	672	
Total liabilities for non-cancellable operating leases	1,407	1,398	

Associates
The department’s share of the operating leases payable arising from its interest in associate is disclosed below.
	2016 $’000	2015 $’000	
Non-cancellable operating leases payable			
Not longer than one year	69	80	
Longer than one year but not longer than five years	123	248	
Total commitment for operating leases (inclusive of GST)	 192	 328	
Less GST recoverable from the Australian Taxation Office	(17)	(30)	
Total commitments for operating lease expenditure	 175	 298	

Note 21. Commitments for expenditure
(a) Commitments other than public private partnerships
		Nominal values		
	Notes	2016 $’000	2015 $’000	
Capital expenditure commitments				
Buildings 		144	2,721	
Roads and structures		189,459	262,936	
Plant, equipment and vehicles		57,427	39,110	
Software		54	78	
Inventory		0	0	
Total capital expenditure commitments	21(b)	247,084	304,845	
				
Department’s share of associate’s capital expenditure commitments				
Investment in associate		164	274	
Total department’s share of associate’s capital expenditure commitments	 164	 274		
				
Other operating commitments				
Outsourcing 		16,158	5,081	
Other operating		577,124	665,716	
Total other operating commitments	21(b)	593,282	670,797	
Total commitments other than public private partnerships 		840,530	975,916	

The figures presented are inclusive of GST, if applicable. 

(b) Commitments payable
	2016 $’000	2015 $’000	
Capital expenditure commitments			
Not later than one year	73,072	95,952	
Later than one year but no later than five years	174,012	206,897	
Later than five years	0	1,996	
Total capital expenditure commitments	247,084	304,845	
			
Department’s share of associate’s capital expenditure commitments			
Not later than one year	62	136	
Later than one year but no later than five years	102	138	
Total department’s share of associate’s capital expenditure commitments	 164	 274	
			
Other operating commitments			
Not later than one year	213,654	265,700	
Later than one year but no later than five years	370,863	395,567	
Later than five years	8,765	9,530	
Total other operating commitments	593,282	670,797	
Total commitments for expenditure (inclusive of GST)	840,530	975,916	
Less GST recoverable from the Australian Taxation Office	(8,871)	(10,969)	
Total commitments for expenditure (exclusive of GST)	831,659	964,947	

Lease commitments
Finance lease liabilities and non-cancellable operating lease commitments are disclosed in Note 20. Leases to the financial statements.

Note 22. Contingent assets and contingent liabilities
	2016 $’000	2015 $’000	
Quantifiable contingent assets			
Other 	1,160	1,160	
	1,160	1,160	
Quantifiable contingent liabilities			
Damages claims (i)	3,379	6,502 	
Public liability insurance claims (ii)	5,725	16,943 	
Breach of contract	3,250	0 	
Other (iii)	17,645	37,675 	
	29,999	61,120	

Note:
(i)	The damages predominately relate to various personal injury claims. 
(ii)	The public liability insurance claims relate to various personal expense matters resulting from serious injury and natural disasters. 
(iii)	The other contingent liabilities relate to various planning application and compensation claims, and reimbursement for lapse of contract.  
Unquantifiable contingent liabilities
The department has the following unquantifiable contingent liabilities. 
Cleaning up the Yarra – Installation of Litter Traps
Under the agreement between the department and the Commonwealth government, the department is required to provide unlimited indemnity to the Commonwealth government for any costs or losses incurred in relation to the Cleaning up the Yarra - Installation of Litter Traps project. The value of this indemnity is not able to be accurately determined.  
Native Titles
There have been four native title claims made in relation to Victorian land and resources (2015: two native title claims). No material losses are anticipated in respect of any of these contingencies.  
Unquantifiable contingent assets
The department did not have any unquantifiable contingent assets in either 2016 or 2015.
Associates
The department does not have quantifiable or unquantifiable contingent assets or liabilities in relation to its investment in PEXA. 

Note 23. Financial instruments 
(a) Financial risk management objectives and policies
The department’s principal financial instruments comprise:
•	cash and deposits;
•	receivables (excluding statutory receivables);
•	investments (excluding investments in associates);
•	payables (excluding statutory payables); and
•	borrowings.
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement, and the basis on which income and expenses are recognised, with respect of each class of financial asset and financial liability above are disclosed in Note 1. Summary of significant accounting policies to these financial statements.
The department holds financial instruments as a result of its ordinary business activities (in the case of receivables and payables), government policy (in the case of cash and borrowings), or to prudentially manage cash balances (in the case of cash deposits and investments).
The department’s main financial risks include credit risk and market risk. The department manages these financial risks in accordance with its financial management policies.
The carrying amounts of the department’s contractual financial assets and financial liabilities by category are disclosed in Table 23.1.

Note 23. Financial instruments (continued)
Table 23.1: Categorisation of financial instruments
	2016	2015						
	Contractual financial assets –  loans and receivables $’000	Contractual financial assets – fair value through profit/loss $’000	Contractual financial liabilities at amortised cost $’000	Total $’000	Contractual financial assets – loans and receivables $’000	Contractual financial liabilities at amortised cost $’000	Total $’000	
Contractual financial assets								
Cash and deposits								
Cash, deposits on call and term deposits less than 3 months	553,410	0	0	553,410	587,537	0	587,537	
Receivables (i) 								
Trade receivables	30,118	0	0	30,118	26,099	0	26,099	
Accrued income	9,484	0	0	9,484	1,946	0	1,946	
Investments:								
Term deposits greater than 3 months	243,190	0	0	243,190	20,100	0	20,100	
Investment in managed fund	0	267,110	0	267,110	0	0	0	
Total contractual financial assets	836,202	267,110	   0	1,103,312	635,682	0	635,682	
Contractual financial liabilities								
Payables (ii)								
Trade creditors	0	0	16,061	16,061	0	32,501	32,501	
Accrued grants and other transfers	0	0	18,501	18,501	0	3,090	3,090	
Capital accruals	0	0	24,273	24,273	0	22,809	22,809	
Other accrued expenses	0	0	30,779	30,779	0	29,393	29,393	
Other payables	0	0	3,029	3,029	0	2,588	2,588	
Borrowings 								
Finance lease liabilities	0	0	32,719	32,719	0	28,871	28,871	
Total contractual financial liabilities	0	   0	125,362	125,362	0	119,252	119,252	

Note:
(i)	The amount of receivables disclosed excludes statutory receivables (i.e. amounts owing from Victorian Government, landfill levies receivable and GST input tax credit receivable) totalling $263.633 million (2015: $237.425 million) – Refer to Note 7. Receivables. 
(ii)	The amount of payables disclosed excludes statutory payables (i.e. amounts owing to Victorian Government for advances from the Public Account and taxes payable) totalling $19.360 million (2015: $36.565 million) – Refer to Note 16. Payables. 
  
Table 23.2: Net holding gain/(loss) on financial instruments by category
	2016	2015					
	Total interest income/ (expense) $’000	Impairment loss $’000	Total $’000	Total interest income/ (expense) $’000	Impairment gain $’000	Total $’000	
Contractual financial assets							
Cash and deposits							
Cash, deposits on call and term deposits less than 3 months 	6,399	0	6,399	6,251	0	6,251	
Receivables							
Trade receivables 	0	(90)	(90)	0	98	98	
Investments							
Term deposits greater than 3 months	5,448	0	5,448	616	0	 616	
Investment in managed fund	11,167	0	11,167	0	0	0	
Total contractual financial assets	23,014	(90)	22,924	6,867	98	6,965	
Contractual financial liabilities							
Payables							
Trade payables	0	0	0	0	0	0	
Borrowings							
Finance lease liabilities	(1,016)	0	(1,016)	(962)	0	(962)	
Total contractual financial liabilities	(1,016)	0	(1,016)	(962)	0	(962)	
 The net holding gains or losses disclosed above are determined as follows:
for cash and deposits, receivables and investments, the net gain or loss is calculated by subtracting any impairment recognised in the net result from the interest income
for financial liabilities measured at amortised cost, the net gain or loss reflects the interest expense.
(b)	 Credit risk 
Credit risk arises when there is the possibility of the department’s counter party defaulting on their contractual obligations resulting in financial loss to the department. Credit risk is measured at fair value and is monitored on a regular basis.
Credit risk associated with the department’s contractual financial assets is minimal because the main debtor is the Victorian Government. Credit assessments are required for all debtors other than government, where $5,000 or more of goods or services are provided. If a customer has a credit rating of less than a Triple-B rating, collateral security is obtained to reduce the department’s credit risk exposure. The department reviews receivables for impairment consistent with the ageing disclosed in Table 23.3.
In addition, the department does not engage in hedging for its contractual financial assets and mainly obtains contractual financial assets that are on fixed interest, except for cash held on call at bank. The department’s policy complies with Standing Direction 4.5.6 issued by the Minister for Finance and only permits deposits to be placed with authorised deposit-taking institutions.
Provision for impairment for contractual financial assets is recognised when there is objective evidence that the department will not be able to collect a receivable. Objective evidence includes financial difficulties of the debtor, default payments, debts which are more than 30 days overdue, and changes in debtor credit ratings. 
The carrying amount of contractual financial assets recorded in the financial statements, net of any allowances for losses, represents the department’s maximum exposure to credit risk without taking account of the value of any collateral obtained.
Contractual financial assets that are either past due or impaired
There are no material financial assets which are individually determined to be impaired. Currently the department does not hold any collateral as security nor credit enhancements relating to any of its financial assets.
There are no contractual financial assets that have had their terms renegotiated so as to prevent them from being past due or impaired, and they are stated at the carrying amounts as indicated. The following table discloses the ageing of contractual financial assets:

Table 23.3: Ageing analysis of contractual financial assets
	Carrying amount $‘000	Not past due and not impaired $‘000	Past due but not impaired				
			Less than 1 Month $‘000	1–3 months $‘000	3 months–  1 year $‘000	1–5 years $‘000	
2016							
Cash and deposits 							
Cash, deposits on call and term deposits less than 3 months	553,410	553,410	0	0	0	0	
Receivables (i)							
Trade receivables	30,118	18,184	7,372	3,941 	559	62	
Accrued income	9,484	9,484	0	0	0	0	
Investments							
Term deposits greater than 3 months	243,190	243,190	0	0	0	0	
Investment in managed fund	267,110	267,110	0	0	0	0	
Total 	1,103,312	1,091,378	7,372	3,941	 559	  62	
2015							
Cash and deposits 							
Cash, deposits on call and term deposits less than 3 months	587,537	587,537	0	0	0	0	
Receivables (i)							
Trade receivables	26,099	13,547	7,975	3,018	1,092	467	
Accrued income	1,946	1,946	0	0	0	0	
Investments							
Term deposits greater than 3 months	20,100	20,100	0	0	0	0	
Total	635,682	623,130	7,975	3,018	1,092	467	

Note:
(i)	The ageing analysis of receivables excludes statutory receivables totalling $263.633 million (2015: $237.425 million) for amounts owing from the Victorian Government, landfill levies receivable and GST input tax credit recoverable as these amounts are not contractual and are therefore outside the scope of this disclosure – Refer to Note 7. Receivables. 
(c) Liquidity risk
Liquidity risk arises when the department is unable to meet its financial obligations as and when they fall due. The department operates under the government’s fair payments policy of settling financial obligations within 30 days and in the event of a dispute, making payments within 30 days from the date of resolution. 
The department’s maximum exposure to liquidity risk is the carrying amounts of financial liabilities as disclosed in the face of the balance sheet. The department manages its liquidity risk by ensuring that it has access to sufficient cash in the public account to meet its current liabilities.
The department’s exposure to liquidity risk is deemed insignificant based on prior period data and current assessment of risk. Cash for unexpected events is generally sourced by drawing on amounts receivable from the Victorian government through the Public Account.
The following table discloses the contractual maturity analysis for the department’s contractual financial liabilities.
Table 23.4: Maturity analysis of contractual financial liabilities
			Maturity dates					
	Carrying amount  $’000	Nominal amount (i) $‘000	Less than 1 month $‘000	1 month – 3 months $‘000	3 months – 1 year $‘000	1–5 years $‘000	5+ years $‘000	
2016								
Payables (i)								
Trade creditors	16,061	16,061	15,956	24	7	22	52	
Accrued grants and other transfers	18,501	18,501	18,501	0	0	0	0	
Capital accruals	24,273	24,273	24,273	0	0	0	0	
Other accrued expenses	30,779	30,779	30,779	0	0	0	0	
Other payables	3,029	3,029	3,029	0	0	0	0	
Borrowings 								
Finance lease liabilities	32,719	32,719	2,037	1,695	10,648	18,339	0	
Total	125,362	125,362	94,575	1,719	10,655	18,361	  52	
2015								
Payables (i)								
Trade creditors	32,501	32,501	16,722	13,759	1,288	721	11	
Accrued grants and other transfers	3,090	3,090	3,090	0	0	0	0	
Capital accruals	22,809	22,809	22,809	0	0	0	0	
Other accrued expenses	29,393	29,393	29,393	0	0	0	0	
Other payables	2,588	2,588	2,588	0	0	0	0	
Borrowings 							 	
Finance lease liabilities	28,871	28,871	1,710	2,396	5,946	18,819	0	
Total	119,252	119,252	76,312	16,155	7,234	19,540	  11	

Note:
(i)	The ageing analysis of payables excludes statutory payables (i.e. amounts owing to Victorian Government for advances from the Public Account and taxes payable) totalling $19.360 million (2015: $36.565 million) – Refer to Note 16. Payables. 
(d) Market risk
The department’s exposures to market risk are primarily through interest rate and equity price  risk with insignificant exposure to foreign currency risks. Objectives, policies and processes used  to manage each of these risks are disclosed below. 
Foreign currency risk
The department occasionally transacts in foreign currencies where the counter party invoices  in a foreign currency. The foreign currency risk is managed by ensuring that the period from the initial transaction and settlement is short (less than 30 days).
Based on past and current assessment of economic outlook, it is deemed unnecessary for  the department to enter into any hedging arrangements to manage the risk.
The department had no exposure to foreign currency risk as at either 30 June 2016 or  30 June 2015.
Interest rate risk
Exposure to interest rate risk relates to cash balances held in deposits at variable interest rates and investments in a managed fund.  Minimisation of risk is achieved by undertaking fixed rate or non-interest bearing financial instruments. The department’s sole borrowings are VicFleet motor vehicle leases. The department’s interest bearing liabilities are managed by VicFleet and interest rates are fixed at the inception of the lease. 
The department’s exposure to interest rate risk is set out in the Table 23.5.
Table 23.5: Interest rate exposure of financial instruments
	Weighted average effective interest rate	Interest rate exposure				
		Carrying amount $‘000	Fixed  interest rate $‘000	Variable  interest rate $‘000	Non-interest bearing $‘000	
2016						
Financial assets						
Cash and deposits						
Cash, deposits on call and term deposits less than 3 months	1.98%	553,410	90,629	207,294	255,487	
Receivables						
Trade receivables		30,118	0	0	30,118	
Accrued income		9,484	0	0	9,484	
Investments						
Term deposits greater than 3 months	2.26%	243,190	243,190	0	0	
Investment in managed fund	1.90%	267,110	79,866	130,083	57,162	
Total financial assets		1,103,312	413,685	337,377	552,250	
Financial liabilities						
Payables						
Trade creditors		16,061	0	0	16,061	
Accrued grants and other transfers		18,501	0	0	18,501	
Capital accruals		24,273	0	0	24,273	
Other accrued expenses		30,779	0	0	30,779	
Other payables		3,029	0	0	3,029	
Borrowings						
Finance lease liabilities	4.63%	32,719	32,719	0	0	
Total financial liabilities		125,362	32,719	0	92,643	

Table 23.5: Interest rate exposure of financial instruments (continued)
	Weighted average effective interest rate	Interest rate exposure				
		Carrying amount $‘000	Fixed  interest rate $‘000	Variable  interest rate $‘000	Non-interest bearing $‘000	
2015						
Financial assets						
Cash and deposits						
Cash, deposits on call and term deposits less than 3 months	2.24%	587,537	679	295,035	291,823	
Receivables						
Trade receivables		26,099	0	0	26,099	
Accrued income		1,946	0	0	1,946	
Investments						
Term deposits greater than 3 months	2.61%	20,100	20,100	0	0	
Total financial assets		635,682	20,779	295,035	319,868	
Financial liabilities						
Payables						
Trade creditors		32,501	0	0	32,501	
Accrued grants and other transfers		3,090	0	0	3,090	
Capital accruals		22,809	0	0	22,809	
Other accrued expenses		29,393	0	0	29,393	
Other payables		2,588	0	0	2,588	
Borrowings						
Finance lease liabilities	5.31%	28,871	28,871	0	0	
Total financial liabilities		119,252	28,871	0	90,381	

Note:
The amount of receivables disclosed excludes statutory receivables (i.e. amounts owing from Victorian Government, landfill levies receivable and GST input tax credit receivable) totalling $263.633 million  (2015: $237.425 million) – Refer to Note 7. Receivables. 
The amount of payables disclosed excludes statutory payables (i.e. amounts owing to Victorian Government for advances from the Public Account and taxes payable) totalling $19.360 million  (2015: $36.565 million) – Refer to Note 16. Payables. 
Equity price risk
The department is exposed to equity price risk through its investment in the Victorian Funds Management Corporation Capital Stable Fund. The fund manager on behalf of the department closely monitors performance and manages equity price risk through diversification of it’s investment portfolio. The department’s sensitivity to equity is detailed in Table 23.7.

Sensitivity disclosure analysis and assumptions
Taking into account past performance, future expectations, economic forecasts, and management’s knowledge and experience of the financial markets, the department believes the following movements are ‘reasonably possible’ over the next 12 months (the cash rate is sourced from the Reserve Bank of Australia): 
a movement of 100 basis points up and down (2015: 100 basis points up and down) in market interest rates (AUD); and
a movement of 10 per cent up and 5 per cent down in the equity price risk (AUD) for the Capital Stable Fund portfolio mix.
Table 23.6 and 23.7 discloses the impact on net operating result and equity for each category of financial instrument held by the department at year-end as presented to key management personnel, if the above movements were to occur.
Table 23.6: Interest rate risk sensitivity
	Carrying amount  $’000	2016 Interest rate risk		
		-1.0%  (-100 basis points) Net result $‘000	+1.0% (100 basis points) Net result $‘000	
Contractual financial assets:				
Cash and deposits (i)	553,410	(2,073)	2,073	
Receivables (ii)	39,602	0	0	
Investments (iv)	510,300	(1,301)	1,301	
Total impact		(3,374)	3,374	
Contractual financial liabilities:				
Payables (ii)	92,643	0	0	
Borrowings (iii)	32,719	0	0	
Total impact		   0	   0	

	Carrying amount  $’000	2015 Interest rate risk		
		-1.0%  (-100  basis points) Net result $‘000	+1.0% (+100  basis points) Net result $‘000	
Contractual financial assets:				
Cash and deposits (i)	587,537	(2,950)	2,950	
Receivables (ii)	28,045	0	0	
Investments (iv)	20,100	0	0	
Total impact		(2,950)	2,950	
Contractual financial liabilities:				
Payables (ii)	90,381	0	0	
Borrowings (iii)	28,871	0	0	
Total impact	 	0	0	

Note:
(i)	All cash and cash equivalents are held in Australian dollars. $249.097 million (2015: $295.035 million) cash and cash equivalents were held on deposit at variable interest rates.  The remainder of the balance was held in non-interest bearing accounts. This item is not subject to any other identified risk sensitivities.
(ii)	The carrying amount is denominated in Australian dollars and is non-interest bearing.  This item is not subject to the identified risk sensitivities.
(iii)	Borrowings relate to finance lease liabilities associated with motor vehicles.  Each contract has interest fixed at the inception of the lease.  This item is not subject to identified risk sensitivities.
(iv)	Investments relate to fixed interest rate term deposits with the Treasury Corporation of Victoria (TCV) and managed investment with the Victorian Funds Management Corporation’s Capital Stable Fund. The Fund invests in a combination of asset classes which include fixed income securities which is subject to movements in interest rate. The fund manager, the Victorian Funds Management Corporation, on behalf of the department closely monitors performance and manages interest rate risk through diversification of it’s investment portfolio. The department’s exposure to interest rate risk is approximately 49 per cent of the Capital Stable Fund portfolio mix which equates to $130.083 million. The investments with TCV have a fixed interest rate, hence no sensitivity risk to interest rate movement.
Table 23.7: Equity price risk sensitivity
2016 Equity price risk				
	Carrying amount  $’000	-5% Fair value through profit/loss $‘000	+10% Fair value through profit/loss $‘000	
Contractual financial assets:				
Investments (i)	267,110	(2,858)	5,716	
Total impact 	267,110	(2,858)	5,716	

Note:
(i)	Relates to managed investment with the Victorian Funds Management Corporation’s Capital Stable Fund. The Fund invests in a combination of asset classes which include cash deposits, fixed term deposits and equities which are subject to movements in equity prices. The fund manager, the Victorian Funds Management Corporation, on behalf of the department closely monitors performance and manages equity price risk through diversification of it’s investment portfolio. The department’s exposure to equity risk is approximately 21 per cent of the Capital Stable Fund portfolio mix which equates to $57.162 million. 

(e)	 Fair value
The fair values and net fair values of financial instrument assets and liabilities are determined as follows:
Level 1 – the fair value of financial instrument with standard terms and conditions and traded in active liquid markets are determined with reference to quoted market prices;
Level 2 – the fair value is determined using inputs other than quoted prices that are observable for the financial asset or liability, either directly or indirectly; and
Level 3 – the fair value is determined in accordance with generally accepted pricing models based on discounted cash flow analysis using unobservable market inputs.
The department categories financial instruments as Level 2 given significant inputs are observable.  
The department considers the carrying amount of financial assets and financial liabilities recorded in the financial statements to be a fair approximation of their fair values, because of the short-term nature of the financial instruments and the expectation that they will be paid in full.

Note 23. Financial instruments (continued)
The following table shows that the fair value of the contractual financial assets and liabilities are the same as the carrying amounts. 
Table 23.8: Comparison between carrying amount and fair value
	2016	2015			
	Carrying amount  $’000	Fair value $‘000	Carrying amount  $’000	Fair value $‘000	
Contractual financial assets					
Cash and deposits 					
Cash, deposits on call and term deposits less than 3 months	553,410	553,410	587,537	587,537	
Receivables (i)					
Trade receivables	30,118	30,118	26,099	26,099	
Accrued income	9,484	9,484	1,946	1,946	
Investments					
Term deposits greater than 3 months	243,190	243,190	20,100	20,100	
Investment in management fund (iii)	267,110	267,110	0	0	
Total contractual financial assets	1,103,312	1,103,312	635,682	635,682	
Contractual financial liabilities					
Payables (ii)					
Trade creditors	16,061	16,061	32,501	32,501	
Accrued grants and other transfers	18,501	18,501	3,090	3,090	
Capital accruals	24,273	24,273	22,809	22,809	
Other accrued expenses	30,779	30,779	29,393	29,393	
Other payables	3,029	3,029	2,588	2,588	
Borrowings 					
Finance lease liabilities	32,719	32,719	28,871	28,871	
Total contractual financial liabilities	125,362	125,362	119,252	119,252	

Note:
(i)	The amount of receivables disclosed excludes statutory receivables (i.e. Amounts owing from Victorian Government, landfill levies receivable and GST input tax credit receivable) totalling $263.633 million  (2015: $237.425 million) – Refer to Note 7. Receivables. 
(ii)	The amount of payables disclosed excludes statutory payables (i.e. Amounts owing to Victorian Government for advances from the Public Account and taxes payable) totalling $19.360 million  (2015: $36.565 million) – Refer to Note 16. Payables. 
(iii)	In measuring fair value of the investment in a managed fund, the Fund Manager, the Victorian Funds Management Corporation, considers the valuation techniques and inputs used in valuing these funds as part of its due diligence prior to investment, to ensure they are reasonable and appropriate and therefore the net asset value (NAV) of the funds may be used as an input into measuring their fair value. The NAV of the fund is adjusted, as necessary, to reflect restrictions and redemptions, future commitments and other specific factors.

Note 24. Cash flow information
	2016 $’000	2015 $’000	
(a) Reconciliation of cash and cash deposits			
Cash at bank and on hand (i)	(5,139)	(167)	
Funds held in trust – cash 	260,626	291,990	
Funds held in trust – deposits on call and term deposits less than 3 months	297,923	295,714	
Total cash and deposits disclosed in the balance sheet	553,410	587,537	
Balance per cash flow statement	553,410	587,537	

Note:
(i)	Due to the State of Victoria’s investment policy and government funding arrangements, the department does not hold a large cash reserve in their bank accounts. Cash received by the department from the generation of income is generally paid into the state’s bank account, known as the Public Account. Similarly, any departmental expenditure, including those in the form of cheques drawn by the department for the payment of goods and services to its suppliers and creditors are made via the Public Account. The process is such that, the Public Account would remit to the department the cash required for the amount drawn on the cheques. This remittance by the Public Account occurs upon the presentation of the cheques by the department’s suppliers or creditors.
	2016 $’000	2015 $’000	
(b) Non-cash financing and investing activities 			
Acquisition of non-current assets by means of finance leases	12,806	9,467	
			
(c) Reconciliation of net result for the period 			
Net result for the period	(33,732)	326,553	
Non-cash movements			
Depreciation	41,433	56,759	
Assets and services received free of charge or for nominal consideration	(5)	(64)	
Assets and services provided free of charge or for nominal consideration	  72	108	
Net gain on disposal of property, plant and equipment	(1,688)	(7,436)	
Net (recognition)/de-recognition of non-financial assets	51,145	(4,117)	
Write-down of property, plant, equipment, intangible assets and inventory	1,516	4,183	
Net (gain)/loss on financial instruments	(2,711)	36	
Loss from revaluation of investment in associates	2,021	0	
Net loss arising from revaluation of long service leave and annual leave liabilities	  82	733	
Other provision discount rate adjustments	41	597	
Movements included in investing and financing activities			
Share of associate’s losses, excluding dividends	4,377	2,985	
Movements in assets and liabilities			
Decrease in receivables	11,947	61,643	
Increase in inventories	(2,249)	(3,802)	
Decrease in prepayments	68,396	4,859	
Increase/(decrease) in payables	 668	(107,549)	
Decrease in provisions	(1,198)	(21,447)	
Decrease in unearned income	(58)	(2,606)	
Net cash flows from operating activities	140,057	311,435	

Note 25. Reserves
	2016 $’000	2015 $’000	
Physical asset revaluation surplus			
Balance at the beginning of the year	5,762,465	5,650,818	
Increment/(decrement) on revaluation during the year resulting from:			
Freehold land	7,026	0	
Crown land – Land and unused roads	565,384	675	
Crown land – National parks	(28,701)	0	
Crown land – State forests	206,270	0	
Crown land – Conservation reserves 	(13,475)	0	
Crown land – Metropolitan parks	394,055	0	
Crown land – Land used for operational purposes	12,225	0	
Buildings and structures	29,187	0	
Roads	(203,026)	110,972	
Historic and cultural assets	74	0	
Balance as at the end of the year 	6,731,484	5,762,465	
Net change in physical asset revaluation surplus	969,019	111,647	

Nature and purpose of physical asset revaluation surplus
The physical asset revaluation surplus is used to record increments and decrements  on the revaluation of non-current physical assets, as described in accounting policy  Note 1(l) Non-financial assets.

Note 26. Summary of compliance with annual parliamentary and special appropriations
(a) Summary of compliance with annual parliamentary appropriations 
The following table discloses the details of the various parliamentary appropriations received by the department for the year.  In accordance with accrual output-based management procedures ‘Provision for outputs’ and ‘Additions to net assets’ are disclosed as ‘controlled’ activities of the department.  Administered transactions are those that are undertaken on behalf of the state over which the department has no control or discretion.
	Appropriation Act		Financial Management Act 1994							
	Annual appropriation $’000	Advance from Treasurer $’000	Administrative Arrangements Act 1983 $’000	Section 29 $’000	Section 30 $’000	Section 32 $’000	Total parliamentary authority $’000	Appropriation applied $’000	Variance $’000	
As at 30 June 2016										
Controlled										
Provision of outputs (i)	996,730	93,274	(1,262)	110,861	(15,222)	78,990	1,263,371	1,164,409	98,962	
Additions to Net Assets Base (ATNAB) (ii)	32,484	163	0	17,041	15,222	27,189	92,099	68,197	23,902	
Administered										
Payments made on Behalf of the State (POBOS) (iii)	620,000	0	0	0	0	0	620,000	613,345	6,655	
POBOS – State contribution under the Murray Darling Basin Act 1993	21,800	0	0	0	0	8,712	30,512	23,568	6,944	
Total	1,671,014	93,437	(1,262)	127,902	0	114,891	2,005,982	1,869,519	136,463	
As at 30 June 2015										
Controlled										
Provision of outputs (i)	1,253,619	30,280	(90,374)	140,888	(215)	154,118	1,488,316	1,225,193	263,123	
ATNAB (ii)	111,169	412	11,266	53,340	4,153	39,682	220,022	110,663	109,359	
Administered										
POBOS (iii)	666,000	0	0	0	0	18,088	684,088	610,074	74,014	
POBOS – State contribution under the Murray Darling Basin Act 1993	30,650	0	0	0	(3,938)	0	26,712	18,000	8,712	
Total	2,061,438	30,692	(79,108)	194,228	0	211,888	2,419,138	1,963,930	455,208	
 
Note 26. Summary of compliance with annual parliamentary and special appropriations (continued)
Note:
(i)	Provision of outputs
The majority of the variance relates to the carry over of output appropriations into 2016-17 to complete the following projects: 
2015-16 Environmental Contributions 3 funding comprises a number of major water initiatives:
Bendigo Ground-Water - The Bendigo Ground-Water Project is a critical infrastructure project that aims to remove contaminated rising ground-Water from Bendigo gold-mines, and in particular the Deborah tourist gold-mine that is a major tourist attraction for Bendigo.  A contract has been recently signed with Coliban Water and the 2015-16 milestone payment has been paid. The balance is to be paid in 2016-17  for delivery of subsequent milestones detailed in the contract between DELWP and Coliban Water. The delivery of this project has been delayed due to the complex nature of the funding agreement.
Climate Change Action Package  - During 2015-16, the department worked closely with our delivery partners to finalise the funding agreements to undertake flood mitigation works and flood mapping. The signing of the 2015-16 Natural Disaster Resilience Grants Scheme (NDGRS) Agreement with the Commonwealth occurred in late 2015-16 resulting in a delay of payments. This carryover enables the department to continue the flood mitigation works and flood mapping and it is expected that the works will be completed in 2016-17. 
Sustainable Water Management - Thomson River - The department has agreed with Melbourne Water, the Melbourne water retailers, the Victorian Environmental Water Holder and the West Gippsland Catchment Management Authority to establish 8GL of storage in Thomson Reservoir as an additional environmental entitlement for the Thomson River. The funding will be provided to Yarra Valley Water, City West Water and South East Water in compensation for the environmental entitlement, without impact to the reliability of the regional urban water corporations. Due to delays in signing the funding agreements, a carryover was requested to meet the department’s contractual commitments with the water retailers in 2016-17.
Delivery of the Goulburn Murray Water (GMW) Connections project has been tracking behind schedule with the primary reason being the inability to obtain signed landowner agreements which are required before any payments can be made to landowners to connect to the new delivery system, and perform on farm works or dry off.
The Victorian Desalination Project funds technical & engineering, planning & environment, commercial & legal services, independent reviewer and project management costs of the plant. Due to delays in contract reviews relating to the 2015 refinancing arrangement of the Victorian Desalination Plant, there were lower than expected contract services, particularly related to commercial and legal expenditure.  Carryover was sought for commercial and legal advisory services that have been committed with external parties such as GHD Pty Ltd and PwC for the ongoing refinancing of the project in 2016-17.
Adverse weather conditions across the State during much of 2015-16 has resulted in reduced levels of some core services being delivered and delays to various base funded projects including: weed and pest management, koala and kangaroo management programs. A range of critical IT related projects (these include departmental procurement, business management and HR system upgrades, Planning Scheme Information Management System, Digital First and Native Vegetation Information System), and a range of Planning portfolio related projects were delayed for varying reasons including MoG integration into DELWP and delays in project approvals. The carryover is required to ensure that the delivery of these projects is achieved and contractual obligations with service providers are met in 2016-17.
(ii)	Addition to Net Assets Base (ATNAB)
The 2016 variance of $23.9 million relates to: 
the carry over of ATNAB available in 2016 for use in 2016 predominantly for:
The underspend in the minor capital works program is due to a combination of seasonal weather factors, delays in finding suitable land for the Forrest, Orbost and Swifts Creek redevelopments and delays in finalising negotiation with the landlord for the Horsham Office.  In addition, the department has needed to re-scope the works for the Briagolong and Erica projects to align with changes to regional requirements.
Funding is required to carry out Recommendation 5 and Affirmation 18 of the 2014 Hazelwood Mine Fire Inquiry. Recommendation 5 and Affirmation 18 requires the State to equip itself to undertake rapid air quality monitoring in any location in Victoria. This is being managed by the Environmental Protection Agency (EPA). EPA are currently reviewing the requirements of the system and as a result, funding is required to be carried over into the next financial year.
The Land Compensation initiative funds the compulsory acquisition of land. Due to the nature of legal processes involved in settling compulsory acquisitions, lengthy delays between the commencement and conclusion of acquisitions can occur. These legal processes are outside the jurisdiction and control of the department. The carryover is to fund compensation claims that are expected to be settled in 2016-17.
(iii) Payments on Behalf of the State (POBOS)
The 2016 variance of $6.7 million relates to a cash flow update for: 
Payments to AquaSure for the Victorian Desalination Project operation and maintenance in 2015-16 have been reduced due to savings resulting from the refinancing of AquaSure’s external debts in March 2016.However, the Victorian Government, post the release of the 2016-17 Budget, placed a 50 gigalitre water order that will result in additional POBOS funding being required in 2016-17. Carryover of the 2015-16 saving is required to partly fund this additional obligation in 2016-17.
Note 26. Summary of compliance with annual parliamentary and special appropriations (continued)
(b) Summary of compliance with special appropriations
		Appropriation Applied		
Authority	Purpose	2016 $’000	2015 $’000	
Output special appropriations				
Section 10 of the Financial Management Act 1994	Appropriation of Commonwealth grants etc.	0	99,580	
Section 201V of the Planning and Environmental Act 1987 	Growth Area infrastructure contributions.	58,746	15,842	
Total special appropriations	58,746	115,422		

(c) Total controlled appropriations applied	Notes			
Provision of outputs				
Annual Parliamentary Appropriations	26(a)	1,164,409	1,225,193	
Special appropriations	26(b)	58,746	115,422	
Total provision of output appropriations applied		1,223,155	1,340,615	
				
Additions to net asset base				
Annual Parliamentary Appropriations	26(a)	68,197	110,663	
Total additions to net asset appropriations applied		68,197	110,663	

Note 27. Ex-gratia payments
	2016 $’000	2015 $’000	
The department has made the following ex-gratia payments:			
Compensation for economic loss	15	0	
	  15	0	

Note:
Includes ex-gratia expenses for both individual items and in aggregate that are greater than or equal to $5,000.
The total for ex-gratia expenses is also presented in ‘Other operating expenses’ of Note 5 Expenses from transactions.
Note 28. Annotated income agreements
The following is a listing of the Financial Management Act 1994 Section 29 annotated income agreements approved by the Treasurer:
		2016 $’000	2015 $’000	
Capital items				
Goulburn-Murray Water Connections Project Stage 1		1,726	3,097	
Land Sales Retained 		0	61	
		1,726	3,158	
Commonwealth specific purpose payments – capital				
Black Rock Water Recycling Project		   0	(121)	
Extending Water Recycling at Torquay		   0	1,550	
GRDC Gene Bank		0	181	
Sunraysia Modernisation		17,041	46,967	
		17,041	48,577	
User charges, or sales of goods and services				
Agriculture and Veterinary Chemical Permits		   0	139	
BushBroker		240	146	
Commercial Forests		4	159	
Constraint Measure Project Business Case Development		1,569	0	
Electronic Conveyancing		15,536	8,915	
Grants to Catchment Management Authorities		   0	1,035	
Landata		25,501	14,199	
Land Titles Office		 187	(347)	
La Trobe contributions to Quarterly Service Payments		0	2,615	
Mapping		1,144	545	
Miscellaneous Industry Contributions		291	15,581	
Goulburn-Murray Water Connections Project Stage 1 		3,659	3,238	
Parks user fees and Werribee Mansion		9,660	9,374	
Queenscliff Harbour Redevelopment		288	52	
Sale of timber resources to Australian Paper		   0	10,873	
Revenue retained on behalf of the Environmental Protection Authority		2,966	2,455	
Seafood Industry Levy		0	294	
SPEARS Project		3,632	2,788	
Water Register – Planning		 245	(272)	
Water Register – State		3,269	1,566	
		68,191	73,355	
Municipal				
Domestic Animals Act		0	1,215	
		0	1,215	

	2016 $’000	2015 $’000	
Commonwealth specific purpose payments – output			
Biodiversity Fund	14	189	
Cleaning up the Yarra - Installation of Litter Traps	516	0	
Coal Seam Gas Bioregional Assessments	321	1,000	
Murray Darling Basin - Environmental Works and Measures Feasibility Program	   0	12	
Murray Darling Basin Plan Implementation	5,558	12,179	
National Framework for Compliance and Enforcement	1,870	1,629	
National Landcare Programme Regional Allocations	20,730	26,943	
Research and Experimental Projects – Commonwealth contributions	   0	14,735	
Sunraysia Modernisation	1,500	2,500	
Victorian Farm Modernisation	10,563	10,975	
	41,072	70,162	
Total annotated income agreements	128,030	196,467	

Note 29. Trust account balances
The following is a listing of trust account balances in cash, deposits and investments relating to trust accounts controlled and administered by the department.
	2016				
	Balance at 1 July 2015 $’000	Total receipts $’000	Total payments $’000	Balance at 30 June 2016 $’000	
Controlled trusts					
Cash, deposits and investments					
Albury Wodonga Land Transfer
Operates under s19 of the Financial Management Act 1994 as a specific purpose operating account. It receives funding and earns interest for the appropriate management and protection of land transferred from the Albury Wodonga Corporation.	802	22	(35)	 789	
Building New Communities Fund
Operates under s201VB of the Planning & Environment Act 1987 to provide assistance for capital works for state funded infrastructure in any growth areas. 	41,509	29,665	(1,000)	70,174	
Casino Area Works Trust
Operates under schedule 5 of the Casino (Management Agreement) (Amendment) Act 1996 to be applied to works for the general improvement of facilities in the Melbourne casino area.  	464	7	0	 471	
Department Suspense
Operates under s19(2) of the Financial Management Act 1994 as a working account. It holds all generic unclaimed funds until they have been identified.	271	0	(138)	 133	
DTF VicFleet
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives funding and makes payments in relation to the government motor vehicle pool.	2,966	4,112	(2,473)	4,605	
Goulburn Murray Water Connections Project Trust
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives fees and disburses payments in relation to the delivery of the Goulburn Murray Water connections and irrigations modernisation program.	232,819	4,304	(69,075)	168,048	
Growth Areas Public Transport Fund
Operates under s201VA of the Planning & Environment Act 1987 to provide assistance for the state funded public transport infrastructure works in any growth areas.	43,500	29,675	(635)	72,540	
Melbourne Strategic Assessment Trust Account
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives fees and disburses payments in relation to the delivery of the Melbourne Strategic Assessment Program.	14,326	15,226	(4,508)	25,044	
Municipal and Industrial Landfill Levy Trust Account
Operates under s19 of the Financial Management Act 1994 as a specific purpose operating account.  It receives municipal and industrial landfill levies from the Environment Protection Authority as specified in s70E(2) of the Environment Protection Act 1970 and manages payments to environmental agencies with the remaining balance transferred to the Sustainability Fund Trust Account.	0	150,926	(150,926)	   0	
Parks and Reserves Trust Account
Operates under s153A of the Water Industry Act 1994 as a specific purpose operating account. It receives the Metropolitan Parks Improvement Rate and makes payments for the management and control of open spaces, parks and waterways in the metropolitan area.	51,749	156,689	(152,455)	55,983	
Plant and Machinery Trust Account
Operates under s23 of the Conservation, Forests and Lands Act 1987 as a specific purpose operating account. It receives funding and makes payments for the renewal, replacement, operation, maintenance and repair of plant and machinery.	70,199	8,254	(3,180)	75,273	
Project Trust Account
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives income and makes payments associated with services the department has been contracted to supply on a fee for service basis	126,471	84,810	(89,161)	122,120	
Revenue Suspense
Operates under s19(2) of the Financial Management Act 1994 as a departmental account. It records all unknown revenue receipts; funds are held until receipts are identified.	27	42	(4)	65	
State Development Special Projects
Operates under s19(2) of the Financial Management Act 1994 to assist in facilitating, encouraging, promoting and carrying out activities leading to a balanced economic development of the state.	12,500	0	(12,500)	   0	
Stores Suspense
Operates under s23 of the Conservation, Forests and Lands Act 1987 as a specific purpose operating account. It receives funding and makes payments for the purchase of stores and the cost of manufacturing articles for stock.	10,182	996	(6,164)	5,014	
Sustainability Fund Trust Account
Operates under s19 of the Financial Management Act 1994 as a specific purpose operating account. It manages grants fostering environmentally sustainable uses of resources, waste management best practice, greenhouse gas reduction and adapting to climate change.	0	529,366	(63,114)	466,252	
Treasury Trust – Small Scale Community Support Fund
Operates under s19 of the Financial Management Act 1994 as an operating account shared across government. It allocates funds the government receives from gaming machines back to the community through a variety of programs.	(396)	396	0	   0	
Treasury Trust – Floods
Operates under s19 of the Financial Management Act 1994 as a shared operating account. It makes state funds available for the restoration of assets and public facilities damaged in floods.	415	6,749	(5,387)	1,777	
Treasury Trust – Rural Council Planning Flying Squad
Operates under s19 of the Financial Management Act 1994 as a shared operating account. It makes state funds available for specialist expert and technical assistance to rural and regional councils on issues such as major projects and developments, long-term land use issues, strategic plans as well as immediate planning support with planning permit and amendment work.	0	1,400	(839)	 561	
Total controlled trusts	607,804	1,022,639	(561,594)	1,068,849	

	2015					
	Balance at 1 July 2014 $’000	MoG transfer to/(from) dept (i) $’000	Total receipts $’000	Total payments $’000	Balance at 30 June 2015 $’000	
Controlled trusts						
Cash, deposits and investments						
Albury Wodonga Land Transfer
Operates under s19 of the Financial Management Act 1994 as a specific purpose operating account. It receives funding and earns interest for the appropriate management and protection of land transferred from the Albury Wodonga Corporation.	898	0	18	(114)	 802	
Building New Communities Fund
Operates under s201VB of the Planning & Environment Act 1987 to provide assistance for capital works for state funded infrastructure in any growth areas.	0	35,304	10,605	(4,400)	41,509	
Casino Area Works Trust
Operates under schedule 5 of the Casino (Management Agreement) (Amendment) Act 1996 to be applied to works for the general improvement of facilities in the Melbourne casino area.	0	459	5	0	 464	
Department Suspense
Operates under s19(2) of the Financial Management Act 1994 as a working account. It holds all generic unclaimed funds until they have been identified.	288	0	0	(17)	 271	
DTF VicFleet (i)
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives funding and makes payments in relation to the government motor vehicle pool.	623	(9)	4,502	(2,150)	2,966	
Disease Compensation Fund
Operates under s5 of the Livestock Disease Control Act 1994 as a special purpose operating account. It provides funds to support the control and eradication of any outbreak and to provide compensation for livestock destroyed due to suffering or suspected of suffering from diseases.	17,591	(18,125)	2,884	(2,350)	   0	
Fisheries Plant and Equipment
Operates under s141 of the Fisheries Act 1995 as a special purpose operating account. It enables the purchase of plant or equipment required for the purposes of the Act, the operation, maintenance and repair of that plant or equipment, and to enable the payment of any other expenses in relation to that plant and equipment.	696	(548)	91	(239)	   0	
Goulburn Murray Water Connections Project Trust
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives fees and disburses payments in relation to the delivery of the Goulburn Murray Water connections and irrigations modernisation program.	0	0	282,455	(49,636)	232,819	
Growth Areas Public Transport Fund
Operates under s201VA of the Planning & Environment Act 1987 to provide assistance for the state funded public transport infrastructure works in any growth areas.	0	35,614	10,326	(2,440)	43,500	
Melbourne Strategic Assessment Trust Account
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives fees and disburses payments in relation to the delivery of the Melbourne Strategic Assessment Program.	9,610	0	11,335	(6,619)	14,326	
Parks and Reserves Trust Account
Operates under s153A of the Water Industry Act 1994 as a specific purpose operating account. It receives the Metropolitan Parks Improvement Rate and makes payments for the management and control of open spaces, parks and waterways in the metropolitan area.	62,237	0	154,363	(164,851)	51,749	
Plant and Machinery Trust Account
Operates under s23 of the Conservation, Forests and Lands Act 1987 as a specific purpose operating account. It receives funding and makes payments for the renewal, replacement, operation, maintenance and repair of plant and machinery.	71,266	(3,987)	10,374	(7,454)	70,199	
Project Trust Account
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It receives income and makes payments associated with services the department has been contracted to supply on a fee for service basis.	158,517	(27,816)	86,101	(90,331)	126,471	
Recreational Fishing Licence
Operates under s151B of the Fisheries Act 1995 as a special purpose operating account. It disburses revenue derived from the sale of recreational fishing licenses to projects that will further improve recreational fishing opportunities in Victoria, and to fund costs incurred in the administration of recreational fishing licences and the account.	6,800	(4,706)	5,061	(7,155)	   0	
Revenue Suspense
Operates under s19(2) of the Financial Management Act 1994 as a departmental account. It records all unknown revenue receipts; funds are held until receipts are identified.	(131)	5	153	0	27	
State Development Special Projects
Operates under s19(2) of the Financial Management Act 1994 to assist in facilitating, encouraging, promoting and carrying out activities leading to a balanced economic development of the state.	0	8,838	9,438	(5,776)	12,500	
Stores Suspense
Operates under s23 of the Conservation, Forests and Lands Act 1987 as a specific purpose operating account. It receives funding and makes payments for the purchase of stores and the cost of manufacturing articles for stock.	11,607	(7)	1,437	(2,855)	10,182	
Treasury Trust – Small Scale Community Support Fund
Operates under s19 of the Financial Management Act 1994 as an operating account shared across government. It allocates funds the government receives from gaming machines back to the community through a variety of programs.	0	112	0	(508)	(396)	
Treasury Trust – Floods
Operates under s19 of the Financial Management Act 1994 as a shared operating account. It makes state funds available for the restoration of assets and public facilities damaged in floods.	5,040	0	7,665	(12,290)	 415	
Total controlled trusts	345,042	25,134	596,813	(359,185)	607,804	

Note:
(i)	As a consequence of the Machinery of Government changes announced on 4 December 2014, a number of trust funds were transferred to and from the department. 
	2016				
	Balance at 1 July 2015 $’000	Total receipts $’000	Total payments $’000	Balance at 30 June 2016 $’000	
Administered trusts					
Cash, deposits and investments					
CH Barbour Forestry Foundation
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account.
It manages funds for prizes, scholarships, research and private donations.	9	0	0	   9	
J Gilmore Farm Water Supply and Hanslow Cup
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account.
It manages funds for prizes, scholarships, research and private donations.	43	1	0	  44	
Natural Disaster Relief Fund
Operates under s19(2) of the Financial Management Act 1994 as a holding account.  It holds money supplied by the Commonwealth until required for expenditure in the case of any natural disasters.	145	0	(30)	 115	
Paid Parental Leave Treasury Trust Fund
Operates under s19(2) of the Financial Management Act 1994 as a working account.  It receives funds from the Commonwealth to meet the eligible costs of parental leave for departmental employees.	52	3	(6)	  49	
Public Service Commuters’ Club 
Operates under s19 of the Financial Management Act 1994 as a working account.  It services loans to staff for the purchase of yearly tickets and funds are recouped through staff salaries and wages.	100	0	(46)	  54	
Securities Trust Fund
Operates under s19 of the Financial Management Act 1994 as a working account.  It receives and holds bonds for use by third parties of public land.	24	25	(25)	  24	
Sidney Plowman Award
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account.
It manages funds for prizes, scholarships, research and private donations.	23	0	0	  23	
Treasury Trust
Operates under s19(2) of the Financial Management Act 1994 as a working account.
It records the receipt and disbursement of unclaimed and unidentified monies such as unpresented cheques, surplus cash, unidentified remittances etc.	887	53	(271)	 669	
Victorian State Foresters’ Association
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account.
It manages funds for prizes, scholarships, research and private donations.	79	1	(49)	  31	
Total administered trusts	1,362	  83	(427)	1,018	

					2015	
	Balance at 1 July 2014 $’000	MoG transfer to/(from) dept $’000	Total receipts $’000	Total payments $’000	Balance at 30 June 2015 $’000	
Administered trusts						
Cash, deposits and investments						
CH Barbour Forestry Foundation
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.	9	0	0	0	   9	
J Gilmore Farm Water Supply and Hanslow Cup
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.	42	0	1	0	  43	
McCashney Scholarship
Operates under s19 of the Financial Management Act 1994 as a specific purpose operating account. To facilitate scholarships to Departmental staff undertaking part-time study on a work related topic and who are not able to access any other benefits under study leave arrangements.	63	(64)	1	0	   0	
Natural Disaster Relief Fund
Operates under s19(2) of the Financial Management Act 1994 as a holding account. It holds money supplied by the Commonwealth until required for expenditure in the case of any natural disasters.	115	30	0	0	 145	
Paid Parental Leave Treasury Trust Fund
Operates under s19(2) of the Financial Management Act 1994 as a working account. It receives funds from the Commonwealth to meet the eligible costs of parental leave for departmental employees.	66	(17)	7	(4)	  52	
Public Service Commuters’ Club 
Operates under s19 of the Financial Management Act 1994 as a working account. It services loans to staff for the purchase of yearly tickets and funds are recouped through staff salaries and wages.	18	0	82	0	 100	
Securities Trust Fund
Operates under s19 of the Financial Management Act 1994 as a working account. It receives and holds bonds for use by third parties of public land.	36	(7)	53	(58)	  24	
Sidney Plowman Award
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.	23	0	0	0	  23	
Treasury Trust
Operates under s19(2) of the Financial Management Act 1994 as a working account. It records the receipt and disbursement of unclaimed and unidentified monies such as unpresented cheques, surplus cash, unidentified remittances etc.	1,193	(451)	377	(232)	 887	
Victorian State Foresters’ Association
Operates under s19(2) of the Financial Management Act 1994 as a specific purpose operating account. It manages funds for prizes, scholarships, research and private donations.	77	0	2	0	  79	
Total administered trusts	1,642	(509)	 523	(294)	1,362	

Note:
(i)	As a consequence of the Machinery of Government changes announced on 4 December 2014, a number of trust funds were transferred to and from the department. 
Trust Accounts opened or closed by the department during 2016
The Municipal and Industrial Landfill Levy Trust Account and the Sustainability Fund Trust Account were opened during the year. 						
No trust accounts were closed during the year.
Treasury trust – Victorian floods
The state has made funds available for the restoration of assets and public facilities damaged in floods through the Treasury Trust Fund.
	2016 $’000	2015 $’000	
Treasury trust – Victorian floods			
Cash at bank at 30 June	1,777	415	
Total funds under management	1,777	415	
Contributions by the Victorian government	2,106	5,510	
Other contributions	4,643	2,155	
Total receipts	6,749	7,665	
Payments to catchment management authorities	133	223	
Payments to portfolio agencies	938	1,088	
Payments to non-portfolio agencies	180	971	
Payments to local governments	1,216	59	
Payments to community groups	0	42	
Payments on state-owned assets 	0	208	
Other payments	2,920	9,699	
Total payments	5,387	12,290	
Balance carried forward at 30 June	1,777	415	

 Third party funds under management
No third party funds were held under management for either 2015–16 or 2014–15.

In accordance with the Ministerial Directions issued by the Minister for Finance under the Financial Management Act 1994, the following disclosures are made regarding responsible persons for the reporting period.
Names
The persons who held the positions of Ministers and Accountable Officers in the department are as follows: 
Minister for Environment, Climate Change and Water	The Hon. Lisa Neville MP	1 July 2015 to 22 May 2016	
Minister for Water	The Hon. Lisa Neville MP	23 May 2016 to 30 June 2016	
Minister for Energy, Environment and Climate Change	The Hon. Lily D’Ambrosio	23 May 2016 to 30 June 2016	
Minister for Planning	The Hon. Richard Wynne MP	1 July 2015 to 30 June 2016	
Minister for Local Government	The Hon. Natalie Hutchins MP	1 July 2015 to 30 June 2016	
Secretary	Mr Adam Fennessy	1 July 2015 to 30 June 2016	

Acting arrangements
The Hon Richard Wynne MP acted as Minister for Environment, Climate Change and Water during the period 15 to 19 February 2016. 
Mr Paul Smith acted in the position of Secretary of the department during the periods 18 to 27 September 2015 and 26 April to 1 May 2016. Ms Kathryn Anderson acted in the position of Secretary during the periods 28 September to 2 October 2015, 1 to 8 April 2016 and 20 to 30 June 2016. Their salary for these periods is included in Note 31(a) Remuneration of executive officers. 
Remuneration
Remuneration received or receivable by the Accountable Officer in connection with the management of the department during the reporting period was in the range:
	2016 No.	2015 No.	
Income band			
$450,000 – $459,999 	0	1	
$470,000 – $479,999 	1	0	

 Amounts relating to ministers are reported in the financial statements of the Department of Premier and Cabinet. For information regarding related party transactions of ministers, the register of members’ interests is publicly available from: www.parliament.vic.gov.au/publications/register of interests.
Related party transactions
Other related transactions and loans requiring disclosure under the Directions of the Minister for Finance have been considered and there are no matters to report.
(a) Remuneration of executive officers
The number of executive officers, other than the Ministers and the Accountable Officer, and their total remuneration during the reporting periods are shown in the first two columns in the table below in their relevant income bands.  The base remuneration of executive officers is shown in the third and fourth columns. Base remuneration is exclusive of bonus payments, long service leave payments, redundancy payments and retirement benefits.  The total annualised employee equivalent provides a measure of full time equivalent executive officers over the reporting period.
Several factors have affected total remuneration payable to executives over the year. A number of employment contracts were completed during the year and renegotiated and a number of executives received bonus payments during the year. These bonus payments depend on the terms of individual employment contracts. Some contracts provide for an annual bonus payment whereas other contracts only include the payment of bonuses on the successful completion of the full term of the contract. A number of these contract completion bonuses became payable during the year.
A number of executive officers retired, resigned or were retrenched in the past year. This has had a significant impact on total remuneration figures due to the inclusion of annual leave, long-service leave and retrenchment payments.
At 30 June 2016, the department employed 62 executive officers (2015: 63 executive officers).
	Total remuneration	Base remuneration			
	2016 No.	2015 No.	2016 No.	2015 No.	
Income band					
Less than  $100,000	15	17	15	21	
$100,000 – $109,999	2	4	2	3	
$110,000 – $119,999	4	6	4	6	
$120,000 – $129,999	1	4	2	4	
$130,000 – $139,999	2	2	1	2	
$140,000 – $149,999	1	7	1	7	
$150,000 – $159,999	2	4	2	7	
$160,000 – $169,999	1	6	5	7	
$170,000 – $179,999	10	5	8	1	
$180,000 – $189,999	4	1	5	6	
$190,000 – $199,999	8	5	11	6	
$200,000 – $209,999	6	7	1	7	
$210,000 – $219,999	1	4	5	1	
$220,000 – $229,999	4	3	3	2	
$230,000 – $239,999	5	1	2	1	
$240,000 – $249,999	1	1	2	1	
$250,000 – $259,999	3	3	3	2	
$260,000 – $269,999	2	2	0	0	
$270,000 – $279,999	0	1	1	0	
$280,000 – $289,999 	1	1	0	0	
$290,000 – $299,999	0	1	0	1	
$300,000 – $309,999	0	0	1	0	
$310,000 – $319,999	1	0	0	0	
$340,000 – $349,999	0	0	0	1	
$350,000 – $359,999	0	0	1	0	
$370,000 – $379,999	1	1	0	0	
$400,000 – $409,999	0	0	1	0	
$420,000 – $429,999	1	0	0	0	
Total number of executives	  76	86	  76	86	
Total annualised employee equivalent	66.0	61.3	66.0	61.3	
Total amount $’000	12,718	13,820	12,304	12,647	

This table discloses executives of the department throughout the 2015-16 and 2014-15 financial years. As a consequence of the Machinery of Government changes announced on 4 December 2014, a number of executives transferred to and from the department on 1 January 2015.
(b)  Payments to other personnel (i.e. contractors charged with significant management responsibilities)
The following disclosures are made in relation to other personnel of the department, i.e. contractors charged with significant management responsibilities.
Payments have been made to a contractor with significant management responsibilities, which is disclosed in expense bands of $10,000. The contractor is responsible for planning, directing or controlling, directly or indirectly, some of the department’s activities. 
	2016 No.	2015 No. 	
Expense band			
Less than  $100,000	0	1	
$290,000 – $299,999	1	0	
Total expenses (exclusive of GST) $’000	295	25	

Note 32. Remuneration of auditors
	2016 $’000	2015 $’000 	
Victorian Auditor-General’s Office			
Audit of the financial statements	373	364	
	373	364	

Note 33. Restructure of administrative arrangements
Restructure of administrative arrangements – 2015 
On 4 December 2014, the Governor in Council, under Section 10 of the Public Administration Act 2004, announced a restructure of its activities via Machinery of Government changes, taking effect on 1 January 2015. As part of the Machinery of Government restructure, the department (as transferor) relinquished its Agriculture, Biosecurity and Sustainably manage fish and forest resources outputs to the newly created Department of Economic Development, Jobs, Transport and Resources (the transferee). The income and expenses for these outputs for the reporting period 1 July to 31 December 2014 is reported by the department, and the income and expenses for the reporting period 1 January to 30 June 2015 is reported by the Department of Economic Development, Jobs, Transport and Resources.
In addition, the department (as transferee) assumed responsibility for the Land Victoria, Local government, Office of the Victorian Government Architect and Planning, building and heritage outputs from the former Department of Transport, Planning and Local Infrastructure (DTPLI), and part of the Regional development (planning) output from the former Department of State Development, Business and Innovation (DSDBI). The income and expenses for these outputs for the reporting period 1 July to 31 December 2014 is reported by the former DTPLI and DSDBI. The income and expenses for the period 1 January to 30 June 2015 is reported by the department. The combined income and expenses for the Land Victoria, Local government and Planning, building and heritage outputs for the reporting period 1 July 2014 to 30 June 2015 are outlined below.  
The department (as transferor) relinquished its Office of the Victorian Government Architect output to the Department of Premier and Cabinet (the transferee) under Section 11 of the Public Administration Act 2004 on 15 May 2015 following an announcement by the Governor in Council. The income and expenses for this output for the period 1 July to 31 December 2014 are reported by the former DTPLI; the period 1 January to 15 May 2015 are reported by the department; and the period 15 May to 30 June 2015 is reported by the Department of Premier and Cabinet.
	Former DTPLI (1 July to 31 December 2014) $’000	Former  DSDBI (1 July to 31 December 2014) $’000	DELWP (1 January to 30 June 2015) $’000	Total $’000	
Land Victoria output					
Controlled income and expenses					
Income 	42,987	0	44,590	87,577	
Expenses	(37,841)	0	(44,885)	(82,726) 	
Administered income and expenses					
Income 	152,228	0	163,389	315,617	
Expenses	(149,662)	0	(160,940)	(310,602) 	
Local government output					
Controlled income and expenses					
Income 	51,231	0	11,839	63,070	
Expenses	(51,407)	0	(9,426)	(60,833) 	
Administered income and expenses					
Income 	271,338	0	540,663	812,001	
Expenses	(271,338)	0	(540,663)	(812,001) 	
Planning, building and heritage output					
Controlled income and expenses					
Income 	46,135	1,619	53,868	101,622	
Expenses	(43,657)	1,622	(41,457)	(83,492) 	
Administered income and expenses					
Income 	678	0	488	1,166	
Expenses	(687)	0	(217)	(904)	

Restructure of administrative arrangements – 2015 (continued) 
The net assets assumed by the department for the Land Victoria, Local government, Office of the Victorian Government Architect, Planning, building and heritage, and Regional development outputs as a result of the administrative restructure is recognised in the balance sheet at the carrying amount of those assets in the transferor’s (the former DTPLI and former DEDBI) balance sheet immediately before the transfer. 
The net assets transferred were treated as a contribution to capital by the State.
2015			
 	Controlled $’000	Administered $’000	
In respect of the activities assumed, the following assets and liabilities were recognised at the date of the transfer:			
Outputs – Land Victoria, Local government, Office of the Victorian Government Architect and Planning, building and heritage – transfer in 			
Assets	 		
Cash and deposits	80,451	34	
Receivables	32,380	3,489	
Investments accounted for using the equity method	12,029	0	
Property, plant and equipment (Note 13)	199,210	0	
Intangible assets (Note 15)	348	0	
Liabilities			
Payables 	(5,849)	(701)	
Borrowings	(1,060)	0	
Unearned income	(2,000)	(24)	
Provisions	(21,581)	0	
Net assets recognised at the date of transfer	293,928	2,798	
Output – Regional development (planning) – transfer in			
Assets	 		
Receivables	717	0	
Property, plant and equipment (Note 13)	62	0	
Liabilities			
Payables 	(717)	0	
Borrowings	(63)	0	
Net assets recognised at the date of transfer	(1)	0	
Total net assets recognised at the date of transfer	293,927	2,798	

Note 33. Restructure of administrative arrangements (continued)
Restructure of administrative arrangements – 2015 (continued
2015			
	Controlled $’000	Administered $’000	
In respect of the activities relinquished, the following assets and liabilities were recognised at the date of the transfer:			
Outputs – Agriculture, Biosecurity and Sustainably manage fish and forest resources – transfer out			
Assets	 		
Cash and deposits	52,164	480	
Receivables	88,472	4,510	
Investments and other financial assets	3,408	0	
Inventories	360	0	
Property, plant and equipment (Note 13)	676,377	0	
Biological assets (Note 14)	1,845	0	
Intangible assets (Note 15)	35,353	0	
Other non-financial assets	34	0	
Liabilities			
Payables 	(70,647)	(662)	
Borrowings	(259,422)	0	
Unearned income	(4,890)	(20,768)	
Deposits repayable	(11)	(25)	
Provisions	(49,014)	0	
Net assets transferred at the date of transfer	474,029	(16,465)	
Output – Office of the Victorian Government Architect – transfer out			
Assets	 		
Cash and deposits	140	0	
Receivables	301	0	
Property, plant and equipment (Note 13)	198	0	
Liabilities			
Payables 	(12)	0	
Borrowings	(241)	0	
Net assets transferred at the date of transfer	386	0	
Total net assets transferred at the date of transfer	474,415	(16,465)	
Net capital contribution from the Crown	(180,488)	19,263	

Note 34. Subsequent events
Machinery of Government Changes
On 23 May 2016, the Premier Daniel Andrews announced a change in Ministerial cabinet. As a result of the change, the department assumed responsibility for the Energy output from 1 July 2016. This output transferred from the Department of Economic Development, Jobs, Transport and Resources and will result in an increase in net assets and contributed capital (equity). The net asset transfer is estimated to be $1.169 million. 
Investment in Property Exchange Australia Limited 
On 1 July 2016, the department’s investment in Property Exchange Australia Limited (PEXA) transferred to the Department of Treasury and Finance. 
The transfer has resulted in a $11.349 million decrease in investments accounted for using the equity method (asset) and in contributed capital (equity). 

Note 35. Glossary of terms and style conventions 
Glossary of terms
Administered item
Administered item generally refers to a department lacking the capacity to benefit from that item in the pursuit of the entity’s objectives and to deny or regulate the access of others to that benefit. 
Amortisation
Amortisation is the expense which results from the consumption, extraction or use over time of a non produced physical or intangible asset. This expense is classified as an other economic flow. Amortisation charged on finance lease vehicles is classified as an expense from transactions. 
Associates
Associates are all entities over which an entity has significant influence but not control, generally accompanying a shareholding and voting rights of between 20 per cent and 50 per cent. 
Borrowings
Borrowings refer to interest-bearing finance leases and other interest-bearing arrangements.
Capital asset charge
A charge levied on the written-down value of controlled non-current physical assets in a department’s balance sheet which aims to: attribute to agency outputs the opportunity costs of capital used in service delivery; and provide incentives to departments to identify and dispose of underutilised or surplus assets in a timely manner. 
Commitments
Commitments include those operating, capital and other outsourcing commitments arising from non cancellable contractual or statutory sources.
Comprehensive result
The comprehensive result is the net result of all items of income and expense recognised for the period. It is the aggregate of operating result and other comprehensive income.
Controlled items
Controlled item generally refers to the capacity of a department to benefit from that item in the pursuit of the entity’s objectives and to deny or regulate access of others to that benefit.
Current grants
Amounts payable or receivable for current purposes for which no economic benefits of equal value are receivable or payable in return.
Depreciation
Depreciation is an expense that arises from the consumption through wear or time of a produced physical or intangible asset. This expense is classified as a ‘transaction’ and so reduces the ‘net result from transactions’.
Effective interest method
The effective interest method is used to calculate the amortised cost of a financial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial instrument, or, where appropriate, a shorter period to the net carrying amount of the financial asset or financial liability.
Employee benefits expenses
Employee benefits expenses include all costs related to employment including wages and salaries, fringe benefits tax, leave entitlements, redundancy payments, defined benefit superannuation plans and defined contribution superannuation plans.
Ex-gratia expenses
Ex-gratia expenses mean the voluntary payment of money or other non-monetary benefit (e.g. a write off) that is not made either to acquire goods, services or other benefits for the entity or to meet a legal liability, or to settle or resolve a possible legal liability or claim against the entity.
Financial asset
A financial asset is any asset that is:
(a) cash
(b) an equity instrument of another entity
(c) a contractual or statutory right:
to receive cash or another financial asset from another entity; or
to exchange financial assets or financial liabilities with another entity under conditions that are potentially favourable to the entity; or
(d) a contract that will or may be settled in the		entity’s own equity instruments and is:

a non-derivative for which the entity is or may be obliged to receive a variable number of the entity’s own equity instruments; or
a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments.
Financial instrument
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial assets or liabilities that are not contractual (such as statutory receivables or payables that arise as a result of statutory requirements imposed by governments) are not financial instruments.
Financial liability
A financial liability is any liability that is:
(a) A contractual obligation:
(i)	to deliver cash or another financial asset to another entity; or
(ii) to exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavourable to the entity; or
(b) A contract that will or may be settled in the 		entity’s own equity instruments and is:
(i)	a non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments; or
(ii) a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments. For this purpose the entity’s own equity instruments do not include instruments that are themselves contracts for the future receipt or delivery of the entity’s own equity instruments.
Financial statements
Financial statements comprise:
(a) A comprehensive operating statement for 		the period;
(b) A balance sheet as at the end of the period;
(c) A statement of changes in equity for the 		period;
(d) A cash flow statement for the period;
(e) Notes, comprising a summary of significant 		accounting policies and other explanatory 		information;
(f)	Comparative information in respect of the preceding period as specified in paragraph 38 of AASB 101 Presentation of Financial Statements.
Grants and other transfers
Transactions in which one unit provides goods, services, assets (or extinguishes a liability) or labour to another unit without receiving approximately equal value in return. Grants can either be operating or capital in nature.
While grants to governments may result in the provision of some goods or services to the transferor, they do not give the transferor a claim to receive directly benefits of approximately equal value. For this reason, grants are referred to by the AASB as involuntary transfers and are termed nonreciprocal transfers. Receipt and sacrifice of approximately equal value may occur, but only by coincidence. For example, governments are not obligated to provide commensurate benefits, in the form of goods or services, to particular taxpayers in return for their taxes.
Grants can be paid as general purpose grants which refer to grants that are not subject to conditions regarding their use. Alternatively, they may be paid as specific purpose grants which are paid for a particular purpose and/or have conditions attached regarding their use.
General government sector
The general government sector comprises all government departments, offices and other bodies engaged in providing services free of charge or at prices significantly below their cost of production. General government services include those which are mainly non-market in nature, those which are largely for collective consumption by the community and those which involve the transfer or redistribution of income. These services are financed mainly through taxes, or other compulsory levies and user charges.
Grants for on passing
All grants paid to one institutional sector (e.g. a state general government entity) to be passed on to another institutional sector (e.g. local government or a private non profit institution).
Intangible produced assets
Refer to produced assets in this glossary.
Intangible non-produced assets
Refer to non-produced asset in this glossary.

Interest expense
Costs incurred in connection with the borrowing of funds include interest on bank overdrafts and short term and long term borrowings, amortisation of discounts or premiums relating to borrowings, interest component of finance leases repayments, and the increase in financial liabilities and non employee provisions due to the unwinding of discounts to reflect the passage of time.
Interest income
Interest income includes unwinding over time of discounts on financial assets and interest received on bank term deposits and other investments. 
Joint ventures
Joint ventures are contractual arrangements between the department and one or more other parties to undertake an economic activity that is subject to joint control and have right to the net assets of the arrangement. Joint control only exists when the strategic financial and operating decisions relating to the activity require the unanimous consent of the parties sharing control (the venturers).
Net result
Net result is a measure of financial performance of the operations for the period. It is the net result of items of income, gains and expenses (including losses) recognised for the period, excluding those that are classified as ‘other economic flows – other comprehensive income’.
Net result from transactions/net operating balance
Net result from transactions or net operating balance is a key fiscal aggregate and is income from transactions minus expenses from transactions. It is a summary measure of the ongoing sustainability of operations. It excludes gains and losses resulting from changes in price levels and other changes in the volume of assets. It is the component of the change in net worth that is due to transactions and can be attributed directly to government policies.
Net worth
Net worth is assets less liabilities, which is an economic measure of wealth.
Non financial assets
Non-financial assets are all assets that are not ‘financial assets’. It includes inventories, land, buildings, road networks, land under roads, plant and equipment, cultural and heritage assets, intangible and biological assets.
Other economic flows included in net result
Other economic flows included in net result are changes in the volume or value of an asset or liability that do not result from transactions. It includes:
gains and losses from disposals, revaluations and impairments of non financial physical and intangible assets; and
fair value changes of financial instruments and agricultural assets.
Other economic flows – other comprehensive income
Other economic flows – other comprehensive income comprises items (including reclassification adjustments) that are not recognised in net result as required or permitted by other Australian Accounting Standards.
The components of other economic flows  other comprehensive income include:
(a) changes in physical asset revaluation surplus; and
(b) gains and losses on remeasuring available for sale financial assets. 
Payables
Payables includes short and long term trade debt and accounts payable, grants, taxes and interest payable.
Produced assets 
Produced assets are non-financial assets that have come into existence as outputs of production process. Produced assets include buildings, plant and equipment, inventories, cultivated assets and certain intangible assets. Intangible produced assets may include computer software, artistic originals, and research and development costs (which does not include the start-up costs associated with capital projects).
Purpose group 
Non-financial physical assets are classified by the ‘purpose’ for which the assets are used, according to one of six ‘Purpose Groups’ based upon Government Purpose Classifications. 
Receivables
Receivables include amounts owing from government through appropriation receivable, short and long term trade credit and accounts receivable, accrued investment income, grants, and interest receivable.

Sales of goods and services
Refers to income from the direct provision of goods and services and includes fees and charges for services rendered, sales of goods and services, fees from regulatory services and work done as an agent for private enterprises. It also includes rental income under operating leases and on produced assets such as buildings and entertainment, but excludes rent income from the use of non-produced assets such as land. User charges includes sale of goods and services income.
Supplies and services
Supplies and services generally represent cost of goods sold and the day-to-day running costs, including maintenance costs, incurred in the normal operations of the department. 
Taxation income
Taxation income represents income received from the state’s taxpayers and includes:
levies (including the environmental levy) on statutory corporations in other sectors of government
the Metropolitan Parks Improvement Rate
other taxes, including landfill levies, licence and concession fees.
Transactions
Transactions are those economic flows that are considered to arise as a result of policy decisions, usually an interaction between two entities by mutual agreement. They also include flows into an entity such as depreciation where the owner is simultaneously acting as the owner of the depreciating asset and as the consumer of the service provided by the asset. Taxation is regarded as mutually agreed interactions between the government and taxpayers. Transactions can be in kind (e.g. assets provided/given free of charge or for nominal consideration) or where the final consideration is cash. In simple terms, transactions arise from the policy decisions of the government.
Style conventions
Figures in the tables and in the text have been rounded. Discrepancies in tables between totals and sums of components reflect rounding. Percentage variations in all tables are based on the underlying unrounded amounts.
The notation used in the tables is as follows:
(xxx.x) negative numbers
200x year period
200x–0x year period
The financial statements and notes are presented based on the illustration for a government department in the 2015–16 Model Report for Victorian Government Departments. The presentation of other disclosures is generally consistent with the other disclosures made in earlier publications of the department’s annual report.

Accountable Officer’s and Chief Finance and Accounting Officer’s declaration
The attached financial statements for the Department of Environment, Land, Water and Planning have been prepared in accordance with Directions 4.2 of the Standing Directions of the Minister for Finance under the Financial Management Act 1994, applicable Financial Reporting Directions, Australian Accounting Standards including Interpretations, and other mandatory professional reporting requirements.
We further state that, in our opinion, the information set out in the comprehensive operating statement, balance sheet, statement of changes in equity, cash flow statement and accompanying notes, presents fairly the financial transactions during the year ended 30 June 2016 and financial position of the department at 30 June 2016.
At the time of signing, we are not aware of any circumstance which would render any particulars included in the financial statements to be misleading or inaccurate.
We authorise the attached financial statements for issue on 12 September 2016.

Adam Fennessy	Carolyn Jackson	
Secretary
Department of Environment, Land, Water  and Planning
Melbourne
12 September 2016	Executive Director Finance and Planning
Department of Environment, Land, Water  and Planning
Melbourne
12 September 2016	

Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 1. Summary of significant accounting policies (continued)
Note 2. Departmental (controlled) outputs (continued)
Note 2. Departmental (controlled) outputs (continued)
Schedule A - Controlled income and expenses for the year ended 30 June 2016 (continued)
Note 2. Departmental (controlled) outputs (continued)
Schedule A - Controlled income and expenses for the year ended 30 June 2016 (continued)
Note 2. Departmental (controlled) outputs (continued)
Schedule A - Controlled income and expenses for the year ended 30 June 2015 (continued)

Note 2. Departmental (controlled) outputs (continued)

Note 2. Departmental (controlled) outputs (continued)
Schedule B - Controlled assets and liabilities as at 30 June 2016 (continued)
Note 2. Departmental (controlled) outputs (continued)
Schedule B - Controlled assets and liabilities as at 30 June 2016 (continued)
Note 2. Departmental (controlled) outputs (continued)
Schedule B - Controlled assets and liabilities as at 30 June 2016 (continued)
Note 3. Administered (non-controlled) items (continued)
(a) Administered income and expenses for the year ended 30 June 2016 (continued)

Note 3. Administered (non-controlled) items (continued)
(a) Administered income and expenses for the year ended 30 June 2016 (continued)

Note 3. Administered (non-controlled) items (continued)
(a) Administered income and expenses for the year ended 30 June 2016 (continued)

Note 3. Administered (non-controlled) items (continued)

Note 3. Administered (non-controlled) items (continued)

Note 3. Administered (non-controlled) items (continued)

Note 3. Administered (non-controlled) items (continued)

Note 3. Administered (non-controlled) items (continued)

Note 3. Administered (non-controlled) items (continued)

Note 3. Administered (non-controlled) items (continued)

Note  9. Investments accounted for using the equity method (continued)

Note 10. Investments in joint operations (continued)

Note 13. Property, plant and equipment (continued) 
Table 13.2 Fair value measurement hierarchy for assets (continued)
Note 13. Property, plant and equipment (continued) 

Note 21. Commitments for expenditure (continued)
Note 23. Financial instruments (continued)

Note 23. Financial instruments (continued)
Note 23. Financial instruments (continued)
Note 23. Financial instruments (continued)

Note 23. Financial instruments (continued)

Note 23. Financial instruments (continued)

Note 23. Financial instruments (continued)

Note 23. Financial instruments (continued)

Note 28. Annotated income agreements (continued)

Note  29. Trust account balances (continued)
Note  29. Trust account balances (continued)
Note  29. Trust account balances (continued)
Note  29. Trust account balances (continued)
Note  29. Trust account balances (continued)
Note  29. Trust account balances (continued)
Note  29. Trust account balances (continued)
Note  29. Trust account balances (continued)
Note 30. Responsible persons
Note 31. Remuneration of executives and payments to other personnel
Note 31. Remuneration of executives and payments to other personnel (continued)
Note 33. Restructure of administrative arrangements (continued)

Note 35. Glossary of terms and style conventions (continued)

Note 35. Glossary of terms and style conventions (continued)

Note 35. Glossary of terms and style conventions (continued)

Appendices
Appendix 1: Disclosure Index  
The annual report is prepared in accordance with all relevant Victorian legislation and pronouncements. This index has been prepared to facilitate identification of the department’s compliance with statutory disclosure requirements. 
Ministerial Directions Report of Operations – FRD Guidance
Legislation	Requirement	Page reference	
Charter and purpose			
FRD 22G	Manner of establishment and the relevant Ministers	Page 9	
FRD 22G	Purpose, functions, powers and duties 	Page 7	
FRD 8D 	Departmental objectives, indicators and outputs	Page 46	
FRD 22G	Key initiatives and projects	Page 3	
FRD 22G	Nature and range of services provided	Page 13	
Management and structure			
FRD 22G	Organisational structure 	Page 12	
Financial and other information			
FRD 8D	Performance against output performance measures 	Page 46	
FRD 8D 	Budget portfolio outcomes	Page 232	
FRD 10A 	Disclosure index	Page 229	
FRD 12A	Disclosure of major contracts	Page 76	
FRD 15C 	Executive officer disclosures	Page 28	
FRD 22G	Employment and conduct principles	Page 23	
FRD 22G	Occupational health and safety policy	Page 21	
FRD 22G	Summary of the financial results for the year 	Page 17	
FRD 22G	Significant changes in financial position during the year 	Page 17	
FRD 22G	Major changes or factors affecting performance 	Page 17	
FRD 22G	Subsequent events	Page 223	
FRD 22G	Application and operation of Freedom of Information Act 1982 	Page 77	
FRD 22G	Compliance with building and maintenance provisions of Building Act 1993	Page 80	
FRD 22G	Statement on National Competition Policy 	Page 81	
FRD 22G	Application and operation of the Protected Disclosure 2012	Page 79	
FRD 22G	Application and operation of the Carers Recognition Act 2012	Page 79	
FRD 22G	Details of consultancies over $10 000 	Page 76	
FRD 22G	Details of consultancies under $10 000 	Page 76	
FRD 22G	Disclosure of government advertising expenditure	Page 77	
FRD 22G	Disclosure of ICT expenditure	Page 77	
FRD 22G	Statement of availability of other information 	Page 95	
FRD 24C	Reporting of office based environmental impacts	Page 36	
FRD 25B	Victorian Industry Participation Policy disclosures	Page 75	
FRD 29A	Workforce Data disclosures	Page 25	
SD 4.5.5	Attestation for compliance with Ministerial Standing Direction 4.5.5	Page 16 	
SD 4.2(j) 	Sign off requirements	Inside front cover	
Financial statements required under Part 7 of the FMA			
SD 4.2(a)	Statement of changes in equity	Page 101	
SD 4.2(b)	Operating statement 	Page 99	
SD 4.2(b)	Balance sheet	Page 100	
SD 4.2(b)	Cash flow statement	Page 102	
Other requirements under Standing Directions 4.2			
SD 4.2(c)	Compliance with Australian accounting standards and other authoritative pronouncements	Page 97	
SD 4.2(c)	Compliance with Ministerial Directions	Page 97	
SD 4.2(d)	Rounding of amounts	Page 107	
SD 4.2(c)	Accountable officer’s declaration	Page 97	
SD 4.2(f)	Compliance with Model Financial Report	Page 229	
Other disclosures as required by FRDs in notes to the financial statements			
FRD 9A	Departmental Disclosure of Administered Assets and Liabilities by Activity	Page 142	
FRD 11A	Disclosure of ex-gratia Expenses	Page 205	
FRD 13	Disclosure of Parliamentary Appropriations	Page 205	
FRD 21B	Disclosures of Responsible Persons, Executive Officers and other Personnel (Contractors with Significant Management Responsibilities) in the Financial Report	Page 217	
FRD 102	Inventories	Page 164	
FRD 103F	Non Financial Physical Assets 	Page 115	
FRD 106A	Impairment of assets	Page 114	
FRD 109	Intangible assets	Page 178	
FRD 110 	Cash Flow Statements	Page 102	
FRD 112D	Defined Benefit Superannuation Obligations	Page 184	
FRD 113A	Investments in subsidiaries, jointly controlled entities and associates	Page 162	
FRD 114B	Financial instruments – general government entities and public non-financial corporations	Page 190	
FRD 119A	Transfers through contributed capital	Page 100	
Legislation			
Building Act 1993	Page 80		
Carers Recognition Act 2012	Page 79		
Financial Management Act 1994	Page 97		
Freedom of Information Act 1982	Page 77		
Heritage Act 1995	Page 78		
Local Government Act 1989	Page 80		
Planning and Environment (Growth Areas Infrastructure Contribution) Act 2010	Page 83		
Protected Disclosure Act 2012	Page 79		
Victorian Industry Participation Policy Act 2003	Page 75		
Water Act 1989	Page 89		

Appendix 2: Budget portfolio outcomes
Operating Statement - Controlled	2015-16
Actuals
$ million	2015-16
Published budget
$ million	Variance
$ million	Variance
%	
Income from transactions					
Output appropriation	1,223.2 	1,186.4 	36.7 	3	
Interest 1	32.3 	21.6 	10.7 	50	
Sales of goods and services 2	91.9 	73.3 	18.5 	25	
Grants 3	64.3 	259.9 	(195.7)	(75)	
Fair value of assets and services received free of charge or for nominal consideration	0.0 	0.0 	0.0 	0	
Other income 4	301.8 	267.9 	33.9 	13	
Total income from transactions	1,713.4 	1,809.2 	(95.8)	(5)	
Expenses from transactions 					
Employee benefits	405.4 	379.1 	26.3 	7	
Depreciation	45.8 	55.1 	(9.3)	(17)	
Interest expense	1.1 	1.3 	(0.2)	(15)	
Grants and other transfers 3	631.7 	672.7 	(41.0)	(6)	
Capital asset charge	91.3 	91.4 	(0.0)	0	
Other operating expenses 5	497.2 	626.3 	(129.1)	(21)	
Total expense from transactions	1,672.6 	1,825.9 	(153.3)	(8)	
Net result from transactions (net operating balance)	40.8 	(16.7)	57.5 	(344)	
Other economic flows included in net result					
Net loss on non-financial assets 6	(50.9)	2.2	(53.1)	(2,414)	
Net loss on financial instruments and statutory receivables/payables	(8.4)	(1.0)	(7.4)	740	
Other losses from other economic flows	(2.5)	0.0 	(2.5)	-	
Total other economic flows included in net result	(61.8)	1.2	(63.0)	(5,250)	
Net result	102.6	(15.5)	(5.5)	35	
Other economic flows - other comprehensive income					
Items that will not be classified to net result					
Changes in physical asset revaluation reserve 7	(598.2)	0.0 	(598.2)	-	
Other	1.3 	0.0 	1.3 	-	
Total other economic flows - other non-owner changes in equity	(596.8)	0.0 	(596.8)	-	
Comprehensive result	(494.2)	(15.5)	(602.4)	3,886	

Note:
1.  	The increase is primarily due to additional funds from the Goulburn Murray Water (GMW) Connections project, and the Sustainability Trust Fund that were invested with Treasury Corporation of Victoria.
2. 	Variance primarily due to increase in External User Charges.
3. 	Variance is mainly due to less funding from the Commonwealth (via DTF) for GMW Connections Stage 2 project because of the delay in achieving milestones.  
4.  	Variance primarily relates to the general increase in the Landfill Levy.
5.  	Variance is attributable mainly to the rephasing of GMW Connections project ($139.7 million). 
6.  	Predominantly relates to the derecognition of land that is now to be reported by Level 1 Committees of Management which are having their statements audited for the first time by VAGO. 
7.  	Result of the full revaluation of non-current physical assets which occurs every five years in accordance with the Financial Reporting Direction (FRD) 103F Non-Current Physical Assets.
Balance Sheet - Controlled	2015-16
Actuals
$ million	2015-16
Published budget
$ million	Variance
$ million	Variance
%	
Assets					
Financial Assets					
Cash and deposit 1	573.1 	293.4 	279.7 	95 	
Receivables	312.1 	302.2 	9.8 	3 	
Other financial assets 2	613.5 	525.0 	88.4 	17 	
Investment accounted for using equity method	11.3 	9.0 	2.3 	26 	
Total financial assets	1,510.0 	1,129.7 	380.3 	34 	
Non-financial assets					
Inventories	21.0 	21.7 	(0.6)	(3)	
Non-financial assets classified as held for sale including disposal group assets	8.3 	0.8 	7.5 	938 	
Property, plant and equipment 3	8,016.7 	7,691.2 	325.5 	4 	
Biological assets	0.0	0.0 	0.0	0 	
Intangible assets	42.3 	44.8 	(2.6)	(6)	
Other 4	9.8 	104.1 	(94.3)	(91)	
Total non-financial assets	8,098.2 	7,862.6 	235.6 	3 	
Total assets	9,608.2 	8,992.2 	615.9 	7 	
Liabilities					
Payables 5 	(103.9)	(134.1)	30.2 	(23)	
Borrowings 6	(34.3)	(12.6)	(21.7)	172 	
Provisions	(148.0)	(148.9)	0.9 	(1)	
Total liabilities	(286.2)	(295.6)	9.4 	(3)	
Net assets	9,322.0 	 8,696.7 	625.3	7 	
Equity					
Accumulated surplus/(deficit)	430.7	715.4	(284.7)	(40)	
Reserves	6,372.1	5,654.0	718.1	13 	
Contributed capital	2,519.2	2,327.3	191.9	8 	
Total equity	9,322.0	8,696.7	625.3	7 	

Note:		
1.  	The variance is primarily due to the Sustainability Fund (investment) now being reported by the department.  The budget for this investment has been classified in Other financial assets.
2.  	Variance predominantly due to MoG changes relating to the Sustainability Trust Fund, and the transfer of the Growth Areas Public Transport Fund and the Building New Communities Fund from DEDJTR.
3.  	Increase due to the full revaluation of non-current physical assets which occurs every five years in accordance with the Financial Reporting Direction (FRD) 103F Non-Current Physical Assets.
4. 	Variance primarily represents the prepayment to GMW for Stage 2 of the Connections Project. The decline is due to less payments made to GMW in the 2015-16 financial year and GMW fully exhausting their prepayment during the year.  Additional payments have not been made by the Commonwealth as they have not agreed to the reported milestones to date. This is supported by the variance reported in grant from the Commonwealth in the Operating Statement  
5.  	The variance is due to a general reduction in trade creditors and accruals as a result of better historical analysis of accrued expenses and early payment of creditors.  
6.  	The variance is primarily due to borrowings linked to VicFleet finance leases liabilities on motor vehicles.
Statement of Cash Flows - Controlled	2015-16
Actuals
$ million	2015-16
Published budget
$ million	Variance
$ million	Variance
%	
Cash flows from operating activities					
Receipts					
Receipts from Government	1,117.0 	1,177.0 	(60.0)	(5)	
Receipts from other entities 1	451.9 	638.1 	(186.1)	(29)	
Interest received 2	33.4 	21.6 	11.8	55 	
Other receipts	5.9 	11.8 	(5.9)	(50)	
Total receipts	1,608.3 	1,848.6 	(240.3)	(13)	
Payments					
Payments of grants and other transfers	(685.9)	(741.7)	55.9	(8)	
Payments to suppliers and employees 3	(855.2)	(992.1)	137.0	(14)	
Capital asset charge	(91.3)	(91.4)	0.0	0	
Interest and other costs of finance paid	1.0	(1.0)	2.0	(200)	
Total payments	(1,631.4)	(1,826.2)	194.9	(11)	
Net cash flows from/(used in) operating activities 	(23.1)	22.3	(45.5)	(204)	
Cash flows from investing activities					
Net investment 2	(127.4)	(74.7)	(52.7)	71	
Payment for non-financial assets	(59.7)	(60.8)	1.0	(2)	
Proceeds from sale of non- financial assets 	5.1	2.2	2.9	132	
Net (purchase)/disposal of investments - policy purposes	(3.8)	0.0	(3.8)	–	
Net cash flows from/(used in) investing activities 	(185.8)	(133.2)	(52.6)	39	
Cash flows from financing activities					
Owner contributions by Government	10.0	12.0	(1.9)	(16)	
Repayment of finance leases	0.0	0.6	(0.6)	(100)	
Net borrowings 4	134.4	(14.0)	148.4	(1,060)	
Net cash flows from/(used in) financing activities 	144.4	(1.4)	145.9	(10,421)	
Net increase/(decrease) in cash and cash equivalents	(64.5)	(112.3)	47.8	(43)	
Cash and cash equivalents at the beginning of the financial year	637.6	405.7	231.9	57 	
Cash and cash equivalents at the end of the financial year	573.1	293.4	279.7	95 	

The variances in this report reflect the variations explained in the departmental controlled comprehensive operating statement and balance sheet.
Note:		
1.  	Variance is mainly due to less funding from the Commonwealth (via DTF) for GMW Connections Stage 2 project because of the delay in achieving milestones.
2.  	The increase is primarily due to additional funds from GMW Connections project, and the Sustainability Trust Fund that were invested with Treasury Corporation of Victoria.
3. 	Variance is attributable predominantly to the rephasing of GMW Connections project.		
4. 	Variance primarily relates to Capital Assets Charge, and Trust Fund balances movement as a result of internal transfers.

Administered items statement	2015-16
Actuals
$ million	2015-16
Published budget
$ million	Variance
$ million	Variance
%	
Administered income					
Appropriations - Payments made on behalf of the State	636.9	650.5	(13.6)	(2)	
Fair value of assets and services received free of charge or for nominal consideration	21.8	0.0	21.8	-	
Sale of goods and services 1	488.8	417.1	71.7	17 	
Grants 2	296.2	573.3	(277.0)	(48)	
Interest	452.7	462.7	(10.0)	(2)	
Other income	203.0	202.1	0.9	0 	
Total administered income	2,099.6	2,305.7	(206.1)	(9)	
Administered expenses					
Expenses on behalf of the State 3	197.1	121.6	75.6	62 	
Grants and other transfers 2	293.1	560.7	(267.6)	(48)	
Payments into the Consolidated Fund	1,144.0	1,108.1	35.9	3 	
Interest and Depreciation expense	4,63.0	4,62.9	0.1	0 	
Total administered expenses	2,097.3	2,253.3	(156.0)	(7)	
Income less expenses	2.3	52.4	(50.3)	(96)	
Other economic flows included in net result					
Net gain/(loss) on non-financial assets 4	13.5	(1.2)	14.8	(1,233) 	
Net gain/(loss) on financial instruments and statutory receivables/payables	0.2	0.0	0.2	-	
Total other economic flows included in net result	13.7	(1.2)	15.0	(1,250) 	
Net result	16.1	51.2	(35.2)	(69)	
Other economic flows - other comprehensive income					
Asset revaluation reserve	0.0	0.0	0.0	0 	
Other	0.0	0.0	0.0	0 	
Total other economic flows - other comprehensive income	0.0	0.0	0.0	0 	
Comprehensive result	16.1	51.2	(35.2)	(69)	
Administered assets					
Cash and deposits  5	49.6	1.4	48.1	3,436	
Receivables 	43,43.9	4,254.0	89.9	2 	
Other financial assets	0.0	0.1	(0.1)	(100)	
Other	0.0	12.7	(12.7)	(100)	
Property, plant and equipment	699.5	688.0	11.4	2 	
Intangible assets 6	162.9	103.1	59.8	58 	
Total administered assets	5,255.9	5,059.4	196.6	4	
Administered liabilities					
Payables 7	(182.8)	(98.2)	(84.6)	86	
Borrowings	(4,173.8)	(4,183.4)	9.6	0	
Total administered liabilities	(4,356.6)	(4,281.5)	(75.0)	2	
Net assets	899.3	777.9	121.4	16	

Note:				
1.  	Variance primarily due to increase in Land Title Office registration and Property Enquiry Service Fees as a result of increased activities in the property market.
2.  	Variance is predominantly due to lower grants received from DEDJTR for local government, as a significant portion of the 2015-16 funding was brought forward into late June 2015.
3. 	Predominantly relates to Land given free of charge to Level 1 Committee of Management which are having their statements audited for the first time by the Victorian Auditor General’s Office (VAGO). 
4.  	Predominantly relates to disposal of Land.				
5.  	Relates to EPA’s Trust Fund Inter Entity account with DTF.				
6.  	Variance primarily relates to the State’s share of Murray Darling Basin Authority - Living Murray Irrigation Water Entitlements.
7.  	Primarily due to EPA account payable to DELWP relating to the Landfill levy.
Statement of Changes in Equity - Controlled	2015-16
Actual
$ million	2015-16
Published budget
$ million	Variance
$ million	Variance
%	
Opening accumulated surplus/(deficit)	456.1 	730.8 	(274.7)	(38)	
Net result	(25.4)	(15.5)	(9.9)	64	
Closing accumulated surplus/(deficit)	430.7 	715.3 	(284.6) 	(40)	
Opening contributions by owners	2,225.3 	2,333.2 	(107.9) 	(5)	
Net transaction with owners in their capacity as owners	293.9 	(5.9)	299.8	(5,082)	
Closing contribution by owners	2,519.2 	2,327.3 	191.9 	8	
Opening physical asset revaluation reserve	5,743.2 	5,654.0 	89.2 	2	
Other reserve	628.9 	0.0   	628.9	-	
Other comprehensive income	0.0      	0.0      	0.0      	0	
Closing physical asset revaluation reserve	6,372.1 	5,654.0 	718.1 	13	
Total equity	9,322.1 	8,696.6 	625.5 	7	

Refer to the notes in the Controlled Operating Statement and Balance Sheet for variance commentary
Appendix 3: Capital projects 
Capital projects/asset investment programs
The Department and its related portfolio entities manage a range of capital projects to deliver services for government. 
Information on the new and existing capital projects for Departments and the broader Victorian public sector is contained in the most recent Budget Paper No. 4 State Capital Program (BP4) which is available on the Department of Treasury and Finance’s website. 
During the year, the Department completed the following capital projects with a Total Estimated Investment of $10 million or greater. The details related to these projects are reported below:
Table 1: Capital projects completed during the financial year ended 30 June 2016
Project Name	Original completion date	Latest approved completion date	Actual completion date	Original approved TEI*
budget $M	Latest approved TEI*
budget $M	Actual TEI cost $M	Variation between actual cost and latest approved TEI budget	Reason for variance from latest approved TEI Budget	
Improved bushfire prevention, preparedness, response and recovery (statewide)	June 2014	June 2016	June 2016	38.606	40.603	40.603	0	N/A	

*Total estimated investment (TEI)
Note:  
This project was included in last year’s completed project list in the DELWP 2014-15 Annual Report, but was financially completed in 2015-16, and is therefore included again in the 2015-16 Annual Report. 

Appendix 4: Disclosure of grants and transfer payments
Effective Water Management and Supply  - grant recipient	$	
Goulburn Broken Catchment Management Authority	23,830,748 	
North Central Catchment Management Authority	12,313,830 	
Goulburn-Murray Rural Water Corporation	11,684,680 	
Corangamite Catchment Management Authority	10,865,461 	
Mallee Catchment Management Authority	10,064,365 	
East Gippsland Catchment Management Authority	9,989,480 	
West Gippsland Catchment Management Authority	8,998,655 	
Victorian Environmental Water Holder	8,791,079 	
Glenelg-Hopkins Catchment Management Authority	7,768,095 	
Wimmera Catchment Management Authority	6,945,890 	
North East Catchment Management Authority	6,877,660 	
Port Phillip and Westernport Catchment Management Authority	3,648,840 	
Department of Justice	3,500,000 	
Melbourne Water	2,293,785 	
Department of Economic Development, Jobs, Transport And Resources	2,247,835 	
Central Highlands Region Water Authority	2,137,367 	
City of Greater Bendigo	2,034,258 	
South East Water Ltd	1,944,603 	
Vic Urban	1,600,000 	
Lower Murray Water	1,561,581 	
Yarra Valley Water Ltd	1,245,413 	
Coliban Water	1,141,756 	
Melton City Council	1,097,421 	
Grampians Wimmera Mallee Water Corporation	983,083 	
Environment Protection Authority	905,000 	
City of Boroondara	875,000 	
Baw Baw Shire Council	854,884 	
Murray-Darling Basin Authority	740,000 	
City West Water Ltd	653,982 	
Darebin City Council	650,000 	
Lend Lease Communities (Australia) Ltd	623,887 	
Manningham City Council	400,000 	
Bureau of Meteorology	397,455 	
City of Greater Geelong	395,000 	
Carranballac P-9 College	390,300 	
Murray Lower Darling Rivers Indigenous Nations	307,856 	
City of Kingston	300,000 	
Falls Creek Alpine Resort Management Board	300,000 	
Goulburn-Murray Water Connections Project	300,000 	
Ewater Ltd	294,316 	
Surf Coast Shire	283,649 	
Rural City of Wangaratta	272,800 	
Barwon Region Water Authority	269,360 	
Monash City Council	226,684 	
Western Water	218,181 	
Southern Rural Water	218,109 	
Nufarm Australia Ltd	213,636 	
Goulburn Valley Water Authority	200,736 	
Victorian State Emergency Service	180,289 	
Knox City Council	180,000 	
North East Region Water Corporation	176,609 	
Wannon Water	171,127 	
Colac Otway Shire Council	157,402 	
City of Ballarat	150,000 	
Pinarc Disability Support	145,400 	
City of Wodonga	136,161 	
Merri Creek Management Committee Inc	121,135 	
Stockland Development Pty Ltd	115,003 	
Southern Metropolitan Cemeteries Trust	110,000 	
City of Melbourne	100,000 	
Moira Shire Council	100,000 	
IIG Property Management Pty Ltd	99,651 	
Gippsland Water	99,091 	
Department of the Environment	97,616 	
Port Phillip Ecocentre Inc	97,495 	
Carlton Neighbourhood Learning Centre Inc	80,514 	
Maresi Corporations Pty Ltd	79,965 	
Water Technology Pty Ltd	75,000 	
Heytesbury District Landcare Network	73,920 	
South Gippsland Water Authority	68,075 	
Yorta Yorta Nation Aboriginal Corporation	60,000 	
East Gippsland Water	59,048 	
Violet Town Bush Nursing Centre	56,900 	
Department of Agriculture Fisheries and Forestry - Australia	52,718 	
Body Corporate Plan 9774	50,192 	
Stonnington City Council	50,000 	
Westernport Water	48,476 	
Parks Victoria	46,000 	
West Wyck Pty Ltd	45,000 	
Shire of Campaspe	44,000 	
Cape Paterson Ecovillage Pty Ltd	40,886 	
Nature Glenelg Trust	37,000 	
Hepburn Springs Golf Club Inc	36,000 	
City of Whittlesea	34,384 	
Casey Grammar School	34,000 	
The University of Melbourne	30,000 	
Victorian Water Industry Association	30,000 	
Horsham Rural City Council	27,318 	
University of New South Wales	25,000 	
Whitehorse City Council	25,000 	
Indigo Shire Council	22,050 	
RMIT University	20,000 	
Victorian Association for Environmental Education	20,000 	
Birdlife Australia	17,500 	
Warrnambool City Council	15,994 	
Ceres - Centre For Education and Research In Environmental Strategies	12,000 	
Cesar Consultants Pty Ltd	11,000 	
Australian Flat Oyster Company Pty Ltd	8,861 	
Nillumbik Shire Council	8,000 	
Coimadai Avenue of Honour Restoration Association Inc	6,602 	
Return of unspent grant funding	(130,119)	
Total	157,314,983 	

Management of Forests, Parks and Public Land - grant recipient	$	
 Parks Victoria 	155,961,688 	
 Zoological Parks and Gardens Board 	20,370,353 	
 Royal Botanic Gardens Victoria 	15,942,218 	
 Mt Baw Baw Alpine Resort 	3,258,338 	
 The University of Melbourne 	2,239,027 	
 Lake Mountain Alpine Resort Management Board 	1,148,478 	
 Gunaikurnai Land and Waters Aboriginal Corporation 	1,055,721 	
 Shrine of Remembrance 	939,000 	
 Department of Economic Development, Jobs, Transport and Resources 	895,375 	
 Gunaikurnai Traditional Owner Land Management Board 	845,000 	
 Mt Baw Baw Resort Management Board 	717,459 	
 Dhelkunya Dja Land Management Board 	614,567 	
 Yorta Yorta Nation Aboriginal Corporation 	520,143	
 Great Ocean Road Coast Committee of Management 	306,879 	
 Tawonga Caravan Park Committee of Management Inc 	300,000 	
 Macedon Ranges Shire Council 	408,390 	
 Four Wheel Drive Victoria 	250,000 	
 National Trust of Australia (Vic) 	241,779 	
 City of Greater Geelong 	331,702 	
 Barwon Coast Committee of Management 	219,935 	
 City of Kingston 	173,073 	
 Kingston City Council 	164,851 	
 Glenelg Shire Council 	160,000 	
 City of Port Phillip 	154,182 	
 Surf Coast Shire 	150,000 	
 Victorian Plantation Corporation 	150,000 	
 Bayside City Council 	144,972 	
 Native Title Services Victoria Ltd 	141,834 	
 Barengi Gadjin Land Council 	133,082 	
 Frankston City Council 	122,166 	
 Falls Creek Alpine Resort Management Board 	120,000 	
 Hobsons Bay City Council 	116,280 	
 Mornington Peninsula Shire Council 	101,400 	
 Dja Dja Wurrung Enterprises Pty Ltd 	101,350 	
 Ridley  Moolap Land Development Corp Pty Ltd 	100,000 	
 Department of Premier and Cabinet 	83,750 	
 Port Franklin Public Purposes and Foreshore Committee 	80,000 	
 Bellarine Bayside Foreshore  Committee of Management Inc 	61,111 	
 East Gippsland Shire Council 	60,541 	
 Hepburn Shire Council 	59,000 	
 Phillip Island Nature Park Board of Management 	58,751 	
 Walwa Tourist Park Inc Committee of Management 	58,000 	
 Moorabool Shire Council 	50,000 	
 Bass Coast Shire Council 	48,956 	
 Victorian National Parks Association 	42,350 	
 Corinella Foreshore Reserve Inc 	35,000 	
 Parklands Albury Wodonga 	33,675 	
 Moyne Shire Council 	30,000 	
 Kavanagh Excavation and Plumbing Pty Ltd 	27,500 	
 Department of Treasury and Finance 	26,712 	
 Blackwood Crown Reserves Committee of Management 	24,656 	
 Otway Coast Committee 	24,466 	
 Federation Heritage Services Pty Ltd 	22,727 	
 Langkoop Hall and Recreation Reserve Committee of Management 	20,000 	
 Mt Hotham Alpine Resort Management Board 	20,000 	
 Whitecliffs - Camerons Bight Foreshore Reserves Committee of Management 	19,551 	
 Balnarring Foreshore Parks and Reserves 	18,337 	
 Birdlife Australia 	14,977 	
 Harmers Haven Residents and Ratepayers Group 	14,460 	
 Corack Mechanics Institute Reserve Committee of Management 	14,048 	
 Great Southern Rail Trail (Leongatha-Yarram Rail Committee of Management) 	13,160 	
 Borough of Queenscliffe 	12,722 	
 Gippsland Plains Rail Trail Committee of Management 	12,000 	
 Warrnambool City Council 	11,762 	
 Castlemaine Pioneers and Old Residents Association Inc 	11,500 	
 Cowwarr Public Hall Reserve 	11,000 	
 Glenmaggie Mechanics Institute 	11,000 	
 East Gippsland Rail Trail Committee of Management 	10,000 	
 Princetown Recreation Reserve Committee 	10,000 	
 Wellington Shire Council 	10,000 	
 Wyeeboo Recreation Reserve 	9,655 	
 Corryong Recreation Reserve Inc 	9,298 	
 Romsey Mechanics Institute 	9,000 	
 Jessica Pocklington 	9,000 	
 Alpine Shire Council 	8,000 	
 Natte Yallock Recreation Reserve Inc 	8,000 	
 Tanjil South Recreation Reserve Committee Inc 	8,000 	
 Wyndham City Council 	7,826 	
 Angair Inc 	7,500 	
 Torquay Coast Action Group 	7,500 	
 Friends of Beware Reef Inc 	7,496 	
 Friends of Flinders Coastline Inc 	7,450 	
 Sarsfield Recreation Reserve Committee of Management Inc 	7,434 	
 Ventnor Coast Care Association Inc 	7,429 	
 Nature Glenelg Trust 	7,348 	
 Badger Creek Hall Committee of Management 	7,240 	
 Nyah District Memorial Hall Committee of Management 	7,155 	
 Bellarine Catchment Network Inc 	7,087 	
 Gippsland Plains Conservation Management Network 	7,039 	
 Emu Plains Racecourse and Recreation Reserve Committee of Management 	6,950 	
 Sandy Point Foreshore Committee of Management 	6,600 	
 Dromana Foreshore Committee of Management Inc 	6,505 	
 Murphy’s Salvage and Demolition 	6,500 	
 Balcombe Estuary Rehabilitation Group Inc 	6,313 	
 Victorian Wader Study Group 	6,295 	
 Australian Marine Mammal Conservation Foundation 	5,998 	
 Southern Otway Landcare Network Inc 	5,597 	
 Chiltern Racecourse Recreation Reserve  Committee of Management 	5,578 	
 Tag For Life 	5,520 	
 Dooen Public Hall Management Committee 	5,500 	
 Daylesford Museum Reserve Committee of Management 	5,400 	
 Merricks Beach Foreshore Committee of Management 	5,012 	
 Friends of Venus Bay Peninsula 	5,000 	
 Other < $5,000 	109,705 	
 Return of unspent grant funding 	(73,595)	
Total	209,929,290 	

Environmental Programs - grant recipient	$	
Parks Victoria	2,017,203 	
Mount Rothwell Biodiversity Pty Ltd	1,140,429 	
Trust For Nature Victoria	1,104,451 	
Wimmera Catchment Management Authority	911,000 	
Glenelg-Hopkins Catchment Management Authority	804,000 	
Vicforests	658,662 	
North Central Catchment Management Authority	619,851 	
Mallee Catchment Management Authority	603,273 	
Nargundy Pty Ltd	555,210 	
North East Catchment Management Authority	532,000 	
The University of Melbourne	486,744 	
Goulburn Broken Catchment Management Authority	467,924 	
Port Phillip and Westernport Catchment Management Authority	456,000 	
Greenhouse Balanced	455,586 	
Corangamite Catchment Management Authority	356,000 	
West Gippsland Catchment Management Authority	336,000 	
East Gippsland Catchment Management Authority	315,000 	
VFF Farm Tree and Landcare Association Inc	309,000 	
Corrections Victoria	250,000 	
Shire of Yarra Ranges	241,950 	
Glen Goulburn	230,559 	
Grand Ridge Plantations Pty Ltd	210,744 	
Dunkeld Pastoral Co Pty Ltd	201,475 	
Landcare Australia Ltd	200,000 	
Nillumbik Shire Council	190,267 	
Yarram Yarram Landcare Network	165,000 	
Tania Kirby	163,097 	
Cardinia Shire Council	150,000 	
Royal Botanic Gardens Victoria	147,572 	
Latrobe Catchment Landcare Network	145,000 	
South Gippsland Landcare Network Inc	145,000 	
Moogji Aboriginal Council	128,000 	
Connecting Country (Mt Alexander Region) Inc	125,000 	
Lismore Land Protection Group	125,000 	
La Trobe University	105,498 	
Nature Glenelg Trust	104,000 	
Southern Otway Landcare Network Inc	91,614 	
LM Buckley and PR Buckley	89,287 	
Euroa Environment Group Inc	85,000 	
Yarrowee Leigh Catchment Group Inc	76,461 	
Grant Flynn	72,791 	
Bass Coast Landcare Network Inc	70,000 	
Hindmarsh Landcare Network	70,000 	
Southern Ranges Environment Alliance	70,000 	
Upper Goulburn Landcare Network	70,000 	
Millewa Carwarp Landcare Group Inc	66,500 	
Zoological Parks and Gardens Board	65,905 	
Rainbow and District Landcare Group	63,980 	
Syer Stephen and Woodward Elisabeth	60,811 	
Heytesbury District Landcare Network	60,490 	
Upper Loddon and Avoca Landcare Network	59,220 	
Hughes Creek Catchment Collaborative	57,850 	
Vegetation Link Pty Ltd	56,500 	
David and Ruth Marnie	55,816 	
Wodonga Urban Landcare Network	55,375 	
Cesar Consultants Pty Ltd	55,000 	
Fechner BA and SJ	53,728 	
Nullawil Landcare Group	52,640 	
Jeroen and Margaret Van Veen	51,418 	
Australian Marine Mammal Conservation Foundation	50,400 	
Barongarook Landcare Group	50,000 	
Bellarine Landcare Group Inc	50,000 	
Blampied-Kooroocheang Landcare Group	50,000 	
East Gippsland Landcare Network Inc	50,000 	
Far East Victoria Landcare Inc	50,000 	
Geelong Landcare Network	50,000 	
Glenaladale Landcare Group	50,000 	
Goulburn Murray Landcare Network Inc	50,000 	
H11 - H12 Community Action Group	50,000 	
Hamilton to Coleraine Railway Line Landcare Group	50,000 	
Kiewa Catchment Landcare Group Inc	50,000 	
Kowree Farm Tree Group Inc	50,000 	
Laharum Landcare Group	50,000 	
Loddon Plains Landcare Network	50,000 	
Maffra and Districts Landcare Network	50,000 	
Manangatang Landcare Group	50,000 	
Merton Landcare Inc	50,000 	
Mid Ovens Landcare Consortium	50,000 	
Mitta Valley Landcare Group Inc	50,000 	
Moorabool Landcare Network	50,000 	
Murrayville Landcare Group	50,000 	
Ovens Landcare Network	50,000 	
Southwest Goulburn Landcare Inc	50,000 	
Strathewen Landcare Group	50,000 	
Surf Coast and Inland Plains Network	50,000 	
Tarragal Landcare Group	50,000 	
Tom's Creek Landcare Group Inc	50,000 	
Up2Us Landcare Alliance	50,000 	
Upper Campaspe Combined Landcare Groups	50,000 	
Upper Mt Emu Creek Landcare Network	50,000 	
Western Port Catchment Landcare Network	50,000 	
Yarra Ranges Landcare Network	50,000 	
Yarrilinks Inc	50,000 	
Bellarine Bayside Foreshore Committee of Management Inc	49,946 	
Upper Deep Creek Landcare Network	49,900 	
Upper Murray Landcare Network	49,888 	
Morison Alden Superannuation Pty Ltd	49,815 	
Basalt To Bay Landcare Network	49,764 	
Panyyabyr Landcare Group	49,545 	
Kara Kara Conservation Management Network Inc	48,086 	
Mornington Peninsula Landcare Network	47,800 	
Lancefield Primary School	46,850 	
Buloke and Northern Grampians Landcare Network	45,562 	
Western Melbourne Catchments Network Inc	45,000 	
Snowy River Interstate Landcare Committee	44,940 	
Avon Landcare Group	44,495 	
Kaniva District Landcare	42,350 	
Wedderburn Conservation Management Network	42,015 	
Woady Yaloak Catchment Group	41,470 	
Christiane Jaeger	41,088 	
Upper Hopkins Land Management Group	39,737 	
Wandobah Pastoral	39,565 	
Michelle Eustice	38,919 	
Richard Sealock	37,500 	
James Patrick Fowler	36,477 	
Greening Australia - Victoria	36,000 	
Environment Protection Authority	35,000 	
Willera Ag Pty Ltd	31,924 	
Cairnlea Conservation Reserves Committee of Management	30,150 	
Wyndham City Council	30,000 	
Mid Loddon Sub-Catchment Management Group	28,036 	
Melbourne Water	26,700 	
Hume City Council	26,300 	
Coomboona Dairies Prop Co 1 Pty Ltd	25,873 	
Ballarat Environment Network Inc	25,140 	
Broken Catchment Landcare Network	25,000 	
Gecko Clan Inc	25,000 	
Perri Joseph	24,914 	
Phillip Island Nature Park Board of Management	23,800 	
DJ Baker-Gabb and JC Fitzherbert	23,700 	
G and J Wallis	22,450 	
Birdlife Australia	22,000 	
Winton Wetlands Committee of Management Inc	21,800 	
AJ and KJ Rowe Pty Ltd	20,491 	
3 Creeks Landcare Network Inc	20,000 	
Bass Valley Landcare Group Inc	20,000 	
Fungimap Inc	20,000 	
Greta Valley Landcare Group	20,000 	
Moorabool Catchment Landcare Group	20,000 	
Mt Rothwell Landcare Volunteers Inc	20,000 	
Parklands Albury Wodonga	20,000 	
Phillip Island Landcare Group	20,000 	
Powlett Project	20,000 	
Northern Plains Conservation Management Network Inc	19,991 	
Dja Dja Wurrung Clans Aboriginal Corporation	19,900 	
Friends of Sassafras Creek Inc	19,900 	
Friends of Merri Creek Inc	19,890 	
Longwood Plains Conservation Management Network Inc	19,725 	
Cardinia Catchment Landcare Inc	19,500 	
Honeysuckle Recreation Environment Project	19,156 	
East Gippsland Rainsforest Conservation Management Network	19,000 	
Kinglake Ranges Neighbourhood House Inc	19,000 	
Vicsuper Ecosystems Services Pty Ltd	18,490 	
Gippsland Plains Conservation Management Network	18,000 	
Mandurang Strathfieldsaye Landcare Network	17,900 	
Birchip Landcare Group	17,600 	
Strathbogie Ranges Conservation Management Network Inc	17,000 	
Koetong Landcare Group	16,740 	
JA Michelson and RJ Michelson	16,000 	
David K Hung	15,919 	
Campaspe River and Land Management	15,779 	
Harvey Spring Creek	15,691 	
Making A Difference (MAD) For The Merri Inc	15,672 	
Wildlife Victoria	15,000 	
South Beach Wetlands and Landcare	14,440 	
Bland Dairies	14,300 	
Stephen Watson	14,024 	
Sharp Transport	13,968 	
Cardinia Environment Coalition Inc	13,860 	
Milawa Markwood Oxley Landcare Group	13,500 	
Geoscience Australia	12,798 	
Wooragee Landcare Group	12,700 	
Pinkerton Landcare and Environment Group Inc	12,220 	
Friends of the Earth Fitzroy	12,100 	
 Kilmore Mechanics Institute and Free Library Inc	11,660 	
Active Seeds	11,608 	
Trentham Reserves Committee of Management	11,200 	
Deakin University	10,909 	
Latrobe University	10,909 	
GJ Mcnaughton Pastoral Co	10,468 	
Friends of the Brisbane Ranges Inc	10,000 	
Geelong Performing Arts Centre	10,000 	
Sussex Heights Primary School	10,000 	
Yarragon Primary School	10,000 	
Euroa Arboretum Inc	9,988 	
Friends of Kevin Hoffman Walk Inc	9,976 	
Bethanga Recreation Reserve Committee of Management	9,964 	
Friends of Willow Park	9,852 	
Julie Caddy	9,572 	
Friends of the Terrick Terrick National Park Inc	9,480 	
Hamilton-Coleraine Railway Line Committee	9,445 	
Flynn Peter J and Brenda V	9,374 	
Dunmoochin Landcare Group Incorporated	8,642 	
St Arnaud Field Naturalists	8,500 	
Gonzaga Reserve Committee of Management	8,400 	
King and Shiau Pty Ltd	7,907 	
Sharkey Farming Trust	7,500 	
Museum of Victoria	7,150 	
Lancefield Park Recreation Reserves Inc	7,060 	
Apex Club of Bairnsdale Inc	7,000 	
Somerville Secondary College	6,886 	
Great Western Recreation Reserve Committee of Management Inc	6,847 	
The Scout Association of Australia Victorian Branch	6,566 	
Mt Worth and District Landcare Group Inc	6,220 	
Merricks Beach Foreshore Committee of Management	6,059 	
Frayne College	5,867 	
Yarram Recreation Reserve Inc	5,818 	
Robert Swinburn	5,727 	
Culmination Superfund	5,438 	
Warrenbayne Boho Land Protection Group Inc	5,366 	
University of Western Sydney	5,000 	
Victorian Landcare Council Inc	5,000 	
Victorian Wildlife Council Inc	5,000 	
Woodleigh School	5,000 	
Other < $5,000	247,774 	
Return of unspent grant funding	(12,107)	
Total	21,105,056 	

Local Government - grant recipient	$	
Melton City Council	6,743,809 	
Nillumbik Shire Council	6,368,354 	
City of Whittlesea	6,312,989 	
City of Casey	5,970,647 	
Cardinia Shire Council	5,611,801 	
Mornington Peninsula Shire Council	5,576,146 	
Wyndham City Council	5,424,654 	
Hume City Council	4,870,722 	
Mitchell Shire Council	3,947,703 	
Shire of Yarra Ranges	3,327,824 	
Eastern Regional Libraries Corporation	2,618,183 	
Yarra Plenty Regional Library Service	2,371,302 	
Casey Cardinia Library Corporation	2,294,874 	
Geelong Regional Library Service	1,966,473 	
Latrobe City Council	1,827,159 	
Whitehorse Manningham Regional Library Corporation	1,767,441 	
Vision Australia Ltd	1,651,349 	
Brimbank City Council	1,458,735 	
City of Ballarat	1,357,956 	
North Central Goldfields Regional Library Corporation	1,298,104 	
Monash City Council	1,141,110 	
City of Boroondara	1,060,976 	
Moreland City Council	1,041,930 	
City of Greater Dandenong	1,007,204 	
City of Kingston	994,385 	
Darebin City Council	932,009 	
Frankston City Council	910,392 	
Melton Shire Council	910,135 	
Glen Eira City Council	898,821 	
City of Greater Geelong	889,953 	
Caroline Chisholm Society	855,000 	
West Gippsland Regional Library Corporation	821,181 	
Goulburn Valley Regional Library Corporation	804,985 	
Hepburn Shire Council	801,088 	
Corangamite Regional Library Corporation	772,027 	
City of Melbourne	763,366 	
Moonee Valley City Council	745,835 	
Mildura Rural City Council	743,568 	
Hobsons Bay City Council	694,792 	
Stonnington City Council	669,431 	
City of Port Phillip	667,905 	
Wimmera Regional Library Service	652,251 	
Bayside City Council	637,724 	
High Country Library Corporation	635,713 	
Monash Health	600,000 	
Wellington Shire Council	567,437 	
City of Yarra	551,210 	
City of Maribyrnong	543,159 	
East Gippsland Shire Council	516,127 	
Colac Otway Shire Council	437,162 	
Gannawarra Shire Council	426,313 	
Glenelg Shire Council	424,330 	
Central Goldfields Shire Council	403,192 	
Murrindindi Shire Council	378,503 	
Horsham Rural City Council	357,880 	
Southern Grampians Shire Council	344,700 	
Yarra City Council	325,704 	
Yarriambiack Shire Council	310,000 	
Northern Grampians Shire Council	305,000 	
Public Libraries Victoria Network Inc	295,879 	
City of Wodonga	295,132 	
Indigo Shire Council	284,643 	
Moorabool Shire Council	281,344 	
Shire of Campaspe	276,550 	
Swan Hill Rural City Council	273,104 	
Surf Coast Shire	263,314 	
Manningham City Council	240,000 	
Golden Plains Shire Council	236,222 	
Buloke Shire Council	220,638 	
Macedon Ranges Shire Council	214,298 	
Towong Shire Council	198,939 	
Ararat Rural City Council	188,513 	
Greater Shepparton City Council	174,345 	
Pyrenees Shire Council	163,766 	
Mt Alexander Shire Council	151,343 	
The Scout Association of Australia Victorian Branch	147,000 	
Strathbogie Shire Council	143,378 	
Loddon Shire Council	125,000 	
Hindmarsh Shire Council	123,970 	
Moyne Shire Council	123,347 	
West Wimmera Shire Council	116,595 	
City of Greater Bendigo	115,521 	
Maroondah City Council	110,700 	
Benalla Rural City Council	107,854 	
Bass Coast Shire Council	106,412 	
South Gippsland Shire Council	105,935 	
Corangamite Shire Council	105,690 	
Baw Baw Shire Council	102,868 	
Campaspe Shire Council	84,120 	
Moira Shire Council	75,000 	
Warrnambool City Council	66,579 	
Mount Alexander Shire Council	60,000 	
Mansfield Shire Council	55,758 	
Alpine Shire Council	49,705 	
Rural City of Wangaratta	45,304 	
Australian Local Government Women's Association Inc Victorian Branch	20,000 	
Other < $5,000	110 	
Total	105,057,600 	

Environmental Policy  - grant recipient	$	
Sustainability Victoria	6,353,858 	
Environment Protection Authority	5,965,983 	
Commissioner for Environmental Sustainability	1,114,608 	
National Association of Charitable Recycling Organisations Inc	1,050,000 	
Parks Victoria	525,084 	
Gippsland Waste and Resource Recovery Group	483,333 	
Barwon South West Waste and Resource Recovery Group	383,333 	
Goulburn Valley Waste and Resource Recovery Group	383,333 	
Grampians Central West Waste and Resource Recovery Group	383,333 	
Loddon Mallee Waste and Resource Recovery Group	383,333 	
North East Waste and Resource Recovery Group	383,333 	
Goulburn Broken Catchment Management Authority	222,015 	
Melbourne Water	181,818 	
East Gippsland Landcare Network Inc	149,500 	
Rural City of Wangaratta	145,000 	
City of Greater Geelong	130,000 	
Conservation Volunteers Australia	128,972 	
Indigo Shire Council	115,000 	
Wurundjeri Tribe Land Compensation and Cultural Heritage Council Inc	114,050 	
East Gippsland Shire Council	111,000 	
Wildlife Victoria	105,000 	
Friends of Merri Creek Inc	93,970 	
Moira Shire Council	80,000 	
Trust For Nature Victoria	77,040 	
Yarram Yarram Landcare Network	75,000 	
Nillumbik Shire Council	74,760 	
VFF Farm Tree and Landcare Association Inc	74,150 	
Manton and Stony Creeks Landcare Group	73,925 	
Longwood Plains Conservation Management Network Inc	70,194 	
City of Casey	60,000 	
City of Port Phillip	50,000 	
Firestarter Pty Ltd	50,000 	
Mornington Peninsula Shire Council	50,000 	
Honeysuckle Recreation Environment Project	46,273 	
Alpine Shire Council	45,000 	
Laharum Landcare Group	41,000 	
Loddon Shire Council	40,000 	
Mount Elephant Community Management	34,695 	
Ballarat Environment Network Inc	33,804 	
Department of the Environment	31,072 	
Merri Creek Management Committee Inc	30,056 	
Central Goldfields Shire Council	30,000 	
Horsham Rural City Council	30,000 	
Upper Campaspe Combined Landcare Groups	28,900 	
South Gippsland Shire Council	26,900 	
Newham and District Landcare Group	26,500 	
Hepburn Shire Council	25,000 	
Moorabool Shire Council	25,000 	
Upper Barwon Landcare Network Inc	25,000 	
West Wimmera Shire Council	25,000 	
Friends of Leadbeaters Possum Inc	22,052 	
Kiewa Catchment Landcare Group Inc	21,883 	
Yarrowee Leigh Catchment Group Inc	21,299 	
Corangamite Shire Council	20,000 	
Darebin City Council	20,000 	
Geoscience Australia	18,400 	
Southern Grampians Shire Council	17,760 	
Brimbank City Council	16,000 	
Australian Marine Mammal Conservation Foundation	13,200 	
The University of Melbourne	12,823 	
Golden Plains Shire Council	10,000 	
Habitat Restoration Fund	10,000 	
Flinders Christian Community College Inc	9,950 	
Port Campbell Public Purpose Reserve	9,850 	
Longwood East Landcare Group Inc	5,994 	
Lismore Land Protection Group	5,480 	
Nicholson River Landcare Group	5,300 	
Burke Road Billabong Committee of Management Inc	5,250 	
City of Wodonga	5,000 	
Colac Otway Shire Council	5,000 	
Maroondah City Council	5,000 	
Mildura Rural City Council	5,000 	
Moyne Shire Council	5,000 	
Northern Grampians Shire Council	5,000 	
Other < $5,000	54,163 	
Return of unspent grant funding	(14,687)	
Total	20,499,841 	

Planning, Building and Heritage - grant recipient	$	
Metropolitan Planning Authority	14,900,000 	
Municipal Association of Victoria	966,000 	
Heritage Council Victoria	500,000 	
CRC For Spatial Information	100,000 	
Perspective Planning Consultants Pty Ltd	45,000 	
Macroplan Holdings Pty Ltd	32,058 	
Brayd Consulting	14,725 	
Fisher Planning Pty Ltd	9,600 	
Perceval Pty Ltd	8,988 	
Meinhardt Infrastructure and Environment Pty Ltd	6,534 	
Other < $5,000	171,120 	
Total	16,754,025 	

Land Victoria - grant recipient	$	
Towong Shire Council	1,000 	
Total	1,000 	

Statutory Activities and Environmental Protection - grant recipient	$	
Environment Protection Authority	44,100,195 	
Sustainability Victoria	22,834,328 	
Metropolitan Waste and Resource Recovery Group	5,179,372 	
Grampians Central West Waste and Resource Recovery Group	898,868 	
Loddon Mallee Waste and Resource Recovery Group	850,364 	
Barwon South West Waste and Resource Recovery Group	837,128 	
Goulburn Valley Waste and Resource Recovery Group	581,512 	
North East Waste and Resource Recovery Group	576,240 	
Gippsland Waste and Resource Recovery Group	560,672 	
Total	76,418,679 	

Fire and Emergency Management - grant recipient	$	
Parks Victoria	24,182,912 	
Otway Coast Committee	638,000 	
Department of Justice	620,229 	
The University of Melbourne	457,500 	
Department of Economic Development, Jobs, Transport and Resources	200,000 	
Bureau of Meteorology	159,829 	
Environment Protection Authority	145,659 	
NSW Rural Fire Service	75,000 	
Southern Otway Landcare Network Inc	30,000 	
Lancefield Mechanics Institute Committee of Management	15,000 	
Total	26,524,129 	
		
GRAND TOTAL	633,604,602 	

Appendix 5: Environmental contributions 
Legislation was passed in September 2004 requiring water authorities to make an environmental contribution to fund initiatives that promote the sustainable management of water or address adverse water-related environmental impacts, equivalent to 5 per cent of urban authorities’ revenues and 2 per cent of rural water authorities’ revenues. Section 195 of the Water Industry Act 1994 requires the department to report on the details of expenditure funded by environmental contributions by water supply authorities in its annual report.
In June 2012 the former Victorian Government established a third tranche of the environmental contribution (EC3). The four-year tranche, which ceased on 30 June 2016, has generated  $405.3 million to fund initiatives consistent with the purposes set out in legislation. 
The table below (Table 1) displays expenditure across each year of the tranche, with 2015-16 project expenditure bringing the total EC3 expenditure as at 30 June 2016 to $327.9 million.
The remaining funds collected through EC3 have now been committed to projects to be delivered from 2016-17 to 2018-19. This includes new projects announced in the 2016-17 state budget as well as the completion of existing projects. The annual expenditure of these projects will be reported in future annual reports.
Table 1: EC3 Current and Projected Expenditure	$’000	
2012-13 expenditure	29,625.7	
2013-14 expenditure	68,676.7	
2014-15 expenditure*	99,827.5	
2015-16 expenditure	129,806.1	
Total EC3 Expenditure as at 30 June 2016	327,936.0	
Funding committed to projects from 2016-17 to 2018-19	77,630.0	
TOTAL Projected EC3 Expenditure	405,566.0	

Note: 
Due to a printing error, the 2014-15 DELWP annual report appendix on EC expenditure omitted reference to project expenditure of $16.7 million (Murray Darling Basin Authority initiative), thereby under reporting total 2014-15 expenditure by this amount.  The table above displays the corrected amount.

The table below (Table 2) displays all project expenditure funded by environmental contributions  in 2015-16. 
Program Title	2015-16 Expenditure
$’000	
Output		
Living Melbourne, Living Victoria	3,410.44	
Breathing life back into the Yarrowee River	200.00	
Securing Priority Waterways: Regional on-ground works 	17,984.89	
Management of environmental entitlements and on-ground delivery 	12,760.43	
Surface water monitoring and data management 	2,786.30	
Groundwater monitoring of the State Observation Bore Network 	2,346.60	
Improving modelling for water resource management and transitioning to the National Hydrologic Platform	1,805.07	
Demonstrating waterway health outcomes	2,048.20	
Maintaining capability in groundwater management	1,392.37	
Managing risks to water availability	1,087.34	
Water user entitlement refinement and market development	1,023.08	
Enhancing the Victorian Water Register  	1,121.76	
Integrated water analysis and reporting	481.99	
Simplifying the Bulk Water Entitlements Framework	452.85	
Water Law Review	213.34	
Coordination of Murray-Darling Basin Plan activities within the department	920.53	
Linking Farms and Catchments to Modernisation II (Whole Farm Planning in the GMID)	514.69	
Improved integrity in water savings assessment and management	176.32	
GMW Connections project management - ensuring governance and accountability	1,034.96	
Flood resilient communities and catchments	284.80	
Basin Plan modelling	867.62	
Living Victoria	7,289.07	
Macalister Irrigation District 2030	180.52	
Catchment Management Authority water statutory costs	6,799.00	
Sustainable Irrigated Agriculture Program	4,428.86	
Implementing environmental water charges	123.00	
Implementing the Government's commitment to flood inquiries	5,113.43	
Sustainable Water Management - Investment in irrigation	3,854.52	
Sustainable Water Management - Healthy waterways	7,004.72	
Sustainable Water Management - Gippsland Lakes	2,500.00	
Sustainable Water Management - Riparian land	8,780.44	
Climate Change Action Package	4,045.03	
Managing groundwater risks from Bendigo mines	5,881.19	
Rural water management	96.10	
Yarra River protection	484.79	
Total projected output funding	109,494.2	
Asset		
Climate Change Action Package - Capital	1,405.50	
Macalister Irrigation District 2030	5,507.00	
Groundwater bores	1,599.41	
Total projected asset funding	8,511.9	
Payment on Behalf of the State		
Murray Darling Basin Authority	11,800.00	
Total projected payment on behalf of the state	11,800.0	
		
Total Environmental Contribution	129,806.1	

Appendix 6: Ministerial Statements of Expectations
Ministerial Statements of Expectations (SOEs) aim to improve regulatory governance and performance. The statements articulate the Government’s priorities and objectives for regulators. Regulators report annually on actions to fulfil these expectations.
The development of each statement is a collaborative effort. Consultation takes place with each regulator to ensure the statements are fit for purpose and take into account the regulator’s circumstances, including objectives, legislative basis, size of organisation, and current practices and processes.
Departmental regulators
In relation to SOEs, DELWP has two broad areas of regulatory responsibility – Planning; and Environment and Climate Change. Regulatory powers and functions are allocated to the Minister for Planning, the Minister for Energy, Environment and Climate Change; and the Secretary of DELWP, and in many cases these powers are delegated. 
Machinery of Government impacts
On 23 May 2016, the Victorian Government announced changes to some ministerial portfolios. Minister Neville retained the Water portfolio, while also assuming responsibility as Minister for Police. Minister D’Ambrosio took on the new portfolio of Energy, Environment and Climate Change, with a focus on renewable energy, energy efficiency and combatting the effects of climate change. Minister D’Ambrosio also became Minister for Suburban Development. These changes resulted in the transfer of the Energy portfolio from DEDJTR to DELWP, commencing from 1 July 2016.
Progress for each commitment and the associated improvement strategies are presented below.
Environment and Climate Change
In March 2015, the Premier of Victoria wrote a charter letter to the then Minister for Environment, Climate Change and Water outlining the Government’s election commitments (EC) and priority initiatives (P) for the Minister’s portfolio. A progress report summarising the key achievements for each initiative over the 2015-16 financial year is below.
2015-16 progress
SOE performance measures	Progress	Status	
(EC) Review the Flora and Fauna Guarantee Act 1988, including a broader assessment of threatened species management	Public consultation on the draft biodiversity plan was held from 17 March to 15 May 2016 and produced more than 250 submissions from individuals and organisations.  DELWP is finalising analysis of the consultation feedback, which will inform the content and timeframes of the final plan. A public discussion paper on the Act review and possible reforms are in preparation, the review is being informed by consultations with 29 stakeholder groups. Further scheduling for possible parliamentary reforms will be finalised in the coming months. 
The 2016-17 State Budget allocated $54 million in funding over  4 years for biodiversity conservation actions. These deliver on-ground actions that align with the direction of the draft plan.
This election commitment is scheduled to be completed in 2017.	In Progress	
(EC) Establish a terms of reference for a public inquiry into the Environment Protection Authority to ensure it strikes the right balance between environment regulation, economic development, and public health and safety	The Ministerial Advisory Committee provided its report, Independent Inquiry into the Environment Protection Authority, to Minister Neville on 31 March 2016. The report was made public on 16 May 2016. The government response to the inquiry's recommendations is currently being prepared and is expected to be released publicly later in 2016.	In Progress	
(EC) Refocus Sustainability Victoria to support communities to take practical actions on climate change, including energy, waste and water efficiency	Sustainability Victoria’s (SV) Strategic Plan, Towards SV2020 was released on 2 March 2016 and is the mechanism to refocus the role of SV to assist the Victorian community with responding to climate change.  In early 2016 SV delivered a series of community conversations across Victoria. SV is leading the delivery of a voluntary climate pledge program across local government, business and the community. This is part of the TAKE2 pledge program announced by government on 9 June 2016. SV received $1.75m in funding to continue the Resource Smart Schools initiative in 2016-17.	In Progress	
(EC) Examine a carbon emission reduction target as part of a new climate change policy approach that recognises the State’s role in adaptation and mitigation	An emissions reduction target of net zero carbon emissions by 2050 was announced on 9 June 2016, alongside a whole of Victorian pledging program to allow all members of Victoria to contribute to this goal (including state government, local government, community and businesses). 
External recruitment to the pledging process is being led by SV, who organised the TAKE2 Climate Change Pledge Action Day. Internal state government pledges are currently being worked through with departments, led through the Climate Change division. 
Outcomes of the pledging process will be collated as part of the Climate Change Framework which will be released at the end of 2016 and provide a long term vision for climate change action in Victoria. 
The Bill for changes to the Climate Change Act will be introduced to Cabinet by the end of 2016.	In Progress	
(P) Seek Cabinet endorsement of suitable projects to help ensure that Victoria secures a maximum share of Direct Action Funding	Victoria is continuing to look for opportunities for Victorian government and key stakeholder participation in the Emissions Reduction Fund (ERF).  DELWP is working with the Commonwealth on the development of new methods which might provide opportunities for future participation in the ERF.
DELWP is working with the Commonwealth government to progress the case for the development of conservation-focused ERF method for native state forest on public land. The Commonwealth government has a prioritisation process to determine what ERF methods are developed. 	In Progress	
(P) Work with local government and industry to support jobs in recycling by removing e-Waste from landfill	The Government made an election commitment to ban e-waste from landfill. To bring this commitment into effect, an e-waste discussion paper, Managing E-waste in Victoria, was released for public feedback in September 2015. A summary of input received is on the DELWP website.
Building on the input from the discussion paper, DELWP is now considering options for the regulatory and non-regulatory tools that will support the ban of e-waste from landfill. Development of tools will occur over the next 12 months. Workshops with industry and local government will take place in August 2016, with further public consultation on a proposal for the ban, including a regulatory impact statement, in early 2017. 
Through feedback on our discussion paper, formal consultation sessions, research on the flow of e-waste in Victoria, and individual discussions with key stakeholders, we have gathered a great deal of information. This is now informing the design and development of the range of measures needed to effectively ban e-waste from landfill. 
E-waste is growing three times faster than general municipal waste in Australia. Given it contains both hazardous and valuable materials, we need be prepared for these increasing volumes. E-waste can present risks to our environment and community but, if managed appropriately and proactively, it presents opportunities. Recovery of the valuable components of e-waste will lead to growth of the e-waste recycling industry and more jobs, as well as ensuring non-renewable resources are available for future generations.
An approach to the landfill ban will be finalised by June 2017, and is likely to come into effect in mid-2018.	In Progress	
(P) Prepare the Government’s response to the State of the Environment Report 2013	On 26 May 2015, the Victorian Government released its response to the State of the Environment Report 2013. The report and the government’s response are informing work currently underway on climate change, biodiversity, waste and resource recovery, and fire and emergency management. The next State of the Environment Report is expected in 2018.	In Progress	
(EC) Fully implement the ban on cattle grazing in the Alpine and Red Gum National Parks	The Victorian Government has permanently banned cattle grazing in the Alpine National Park and river red gum parks. A Bill to amend the National Parks Act 1975 was introduced into Parliament on 17 March 2015 and was passed by the Legislative Council on 5 May 2015.
This election commitment has been delivered. 	Complete	
(EC) Amend legislation to remove the Government’s ability to grant 99 year leases in national parks	The No 99 Year Lease Bill was introduced into Parliament on 15 September and debated on 6-8 October 2015.  The Act commenced on 27 October 2015.
This election commitment has been delivered (October 2015).	Complete	
(EC) Establish an industry taskforce to examine the future of VicForests’ Central Highlands Operation	The Forest Industry Taskforce Terms of Reference were released in November 2015.  A deliberating phase with workshops began in February 2016.  Professor Don Henry was announced as the independent chair of the taskforce in June 2016.  The commencement of the deciding phase also begun in June 2016 and will result in the production of a mid-year report that will be submitted to government.	In Progress	
(EC) Establish a new Marine and Coastal Act and refocus the operations of environmental agencies, including catchment management authorities, to ensure their effective delivery	Development of a new Marine and Coastal Act is progressing with a discussion paper prepared with guidance from an expert panel soon to be released. Public consultation on the paper will guide preparation of the new Act as well as potential changes to management and oversight arrangements in 2017.	In Progress	
(EC) Coordinate the Government’s oversight of the Portarlington Safe Harbour development	This is a joint election commitment between DEDJTR and DELWP. 
Parks Victoria has let two contracts. Breakwater works are well advanced and works to create new berths for commercial aquaculture operators are progressing as scheduled.  A third works element, upgrade of the pier head and lower landing, will be let when the remaining budget is known and scope of works finalised.  Dredging works on the inner harbour are completed. A consequential benefit of the dredging has been renourishment of Portarlington beach. 
The Portarlington Safe Harbour project commenced and a Project Steering Group was established.  The detailed planning and approval processes were initiated. This project supports the aquaculture industry by adding value to the growing mussel industry in Portarlington, and sustaining a growing scallop harvesting sector. It will also enhance leisure activities in the region and assist in longer-term tourism opportunities through the development of recreational boating opportunities.
This election commitment is scheduled to be completed by December 2016.	In Progress	
(P) Review options for the proposed Point Nepean Quarantine Station Development	The election commitment to review the options for the proposed Point Nepean Quarantine Station Development has been completed.
The Parks Victoria process to refresh the 2010 master plan has commenced with  reports on community consultation due to be released in late July 2016. The final draft master plan is due to be exhibited later in 2016 and finalised in 2017. The scope of the master plan has expanded in response to community consultation, and it will now include an implementation plan.	In Progress	
(P) Review existing policy and legislative arrangements for the management of Crown land, with a view to creating a modem and flexible system	The proposed approach to progress Crown land reform directions over the near to midterm is to link with and build on relevant projects that are currently underway e.g. the VEAC statewide assessment of public land (discussion paper due August 2016, final report due mid 2017); the new Marine and Coastal Act and governance arrangements; and Land Victoria’s proposed reforms to improve government land records.	In Progress	
(EC) Assist the Minister for Planning to establish a new Yarra River Trust to develop standardised planning controls for the Yarra	The Victorian Government committed to protect the Yarra River’s amenity and significance by introducing legislation, stronger planning controls and a Trust (or similar entity) to ensure this valuable asset is protected for the benefit and enjoyment of future generations. 
In December 2015, the Minister for Planning and the then Minister for Environment, Climate Change and Water announced a new Yarra River Protection Ministerial Advisory Committee to provide advice on the need and form of legislation and trust. Interim planning controls were implemented in January 2016 that establish development and vegetation management expectations to guide appropriate development while permanent controls are progressed for protecting the whole of the Yarra River Corridor.
Following stakeholder engagement, a discussion paper was released in July 2016 for public consultation in early July. The paper promotes discussion and debate on the key issues and proposed governance reforms. Submissions to the paper close in August 2016, and it is anticipated that the Ministerial Advisory Committee will provide advice to Government in late 2016.	 In Progress	
(P) Review and focus the operations of environmental agencies, including catchment management authorities, to ensure their effective delivery	VAGO Action Plan for CMA audit completed. Key actions delivered are: (1) development of improved strategic planning for integrated catchment management; (2) review relevant legislative instruments to improve statewide catchment management; (3) improve linkages between funding and overarching for integrated catchment management and regional catchment strategy priorities; (4) development of a catchment condition and management reporting framework; (5) improved information collation and access to support catchment condition and management of monitoring, evaluating and reporting. Further implementation will occur over the next four years through the Our Catchments, Our Communities strategy, supported by $22 million investment. Minister Neville launched Our Catchments, Our Communities, a new statewide strategy for integrated catchment management on 19 May 2016.	Complete	
(P) Review the merits of the grid of inter-urban water pipelines to enable water 
sharing with areas of greatest need across Victoria	The merits of a water grid are reviewed and supported.  The Water for Victoria discussion paper includes proposed strategic directions on creating a grid oversight role to inform statewide investment decisions and to explore options for additional connections to better use the grid.  Further work (and funding) will provide more detailed directions on the best ways of using the water grid. Response from the consultation on the discussion paper will inform the final plan.	Complete	

Planning
In October 2014, the Minister for Planning wrote to Heritage Victoria and the Heritage Council of Victoria, providing SOEs to establish clear performance goals to reduce red tape and promote greater efficiency and effectiveness in the administration and enforcement of regulation. Four key areas were identified for performance improvements:
Role clarity between Heritage Victoria and the Heritage Council 
Clear and consistent regulatory activities and strengthening of risk based strategies
Accountability and transparency
Compliance related assistance and advice.

2015-16 progress
SOE performance measures	Progress	Status	
Heritage Victoria and the Heritage Council of Victoria will agree protocols, procedures and standards of operating	Enter into a Memorandum of Understanding (MOU) by October 2014. The MOU will set out agreed protocols, procedures and standards of operating.	To be achieved through amendments to the Heritage Act rather than a MOU – no longer required	
Review opportunities to streamline statutory processes	Review opportunities to streamline statutory processes based on risk assessment, to reduce ‘red tape’ for applicants and stakeholders.	In progress
(incorporated into 2016-17 SOEs)	
Heritage Victoria and the Heritage Council of Victoria will improve the presentation and quality of heritage data to facilitate sharing with stakeholders	Improve the presentation and quality of heritage data to facilitate sharing with stakeholders through the redevelopment of the Victorian Heritage Database by December 2014.	Complete	
Review and revise permit conditions using plain English by February 2015	Heritage Victoria and the Heritage Council of Victoria will ensure advice given is clear and concise.	In progress
(incorporated into 2016-17 SOEs)	

Forest, Fire and Regions 
In June 2014, the then Minister for Environment and Climate Change wrote to the former DEPI, providing a Statement of Expectations for the regulation of land, fire and environment activities. In its response to the minister in July 2014, the department outlined a range of commitments and actions that would be implemented over the next one to two years. These commitments included:
Regulatory principles
Role clarity.
Regulatory principles - Land, Fire and Environment improvement strategy

Relevant areas	Improvement strategy	Targets	
All former LFE regulatory areas	To work with other DELWP regulators to jointly develop a standard for measuring DELWP’s performance in delivering the regulatory principles and report against the standard.	Participate in preparing the standard, collect and report on baseline data by 1 July 2016	

2015-16 progress
DELWP is currently updating its overarching compliance policy to cover latest MoG changes and ensure a best practice, risk-based approach is being followed.  Compliance strategies for the following key functional areas - Wildlife Act 1975, Flora and Fauna Guarantee Act 1988, high risk invasive animals, public land compliance (draft), bushfire prevention and tour operator compliance are completed or in final draft.  Work has commenced on developing control plans for each of the above strategies, which detail high level priorities to focus compliance efforts.  Annual reviews (strategic assessments) will be conducted each year to measure the performance of compliance activities and set compliance goals for the following year.  
The existing regional compliance will be progressively updated as control plans give greater focus  to priorities.  
Governance arrangements have been established to oversee the development and implementation of all levels of these plans.  These arrangements include regular meetings with portfolio partners, including Parks Victoria, EPA, DEDJTR and others, at the state and regional level.  Partner agencies are also involved in the annual strategic assessment, ensuring a consistent approach.
Role clarity - Land, Fire and Environment improvement strategies
Relevant areas	Improvement strategies	Targets	
Beekeeping,
Native vegetation, Timber harvesting 
	Regulatory areas to review existing compliance monitoring and assurance regimes to ensure that regulatory objectives are being met.	Complete reviews by  1 July 2016	

2015-16 progress
All strategies are currently being updated to reflect latest departmental structural changes, this will include updating names for roles and responsibilities. Existing strategies remain operational as roles and responsibilities have been allocated as part of restructure.
Native Vegetation: The Government’s Native Vegetation Regulations review is due for completion later in 2016, and any work relating to compliance matters has been placed on hold.  Once the review is completed, a compliance strategy and subsequent control plan will be developed, which will clarify roles and responsibilities.
Tour operators: Current compliance strategy clarifies roles and responsibilities, with Parks Victoria taking a lead role. 
Wildlife: Flora and Fauna Guarantee Act 1988 and Wildlife Act 1975 current compliance strategies outline roles and responsibilities.
The Code of Practice for Timber Production 2014 was reviewed and the three priority areas; construction and maintenance of coupe roads, construction and rehabilitation of waterway crossings and the protection of mandatory exclusion areas from the impacts of timber harvesting are all still relevant.

Appendix 7: Municipal and Industrial Landfill Levy Trust Account
Victoria applies a levy on each tonne of municipal and industrial waste disposed to Victorian landfills. The Environment Protection Act 1970 determines how municipal and industrial landfill levy revenue is to be managed and spent. Legislative amendments to the Act effective 1 July 2015 revised these conditions.
The EPA continues to collect landfill levies and credit them to the Environment Protection Fund. Consistent with the legislative amendments commencing 1 July 2015, the EPA now transfers the municipal and industrial landfill levies to DELWP’s newly created Municipal & Industrial Landfill Levy (MILL) Trust Account each quarter. 
Payments from the MILL Trust Account are then made to government agencies consistent with Ministerial Determinations approved and signed by the Minister for Energy, Environment and Climate Change as required under Section 70E of the Act.  
Annual payments are made to the EPA, Sustainability Victoria and the seven Waste and Resource Recovery Groups to support the operations of these environment agencies. A total of $56.31 million in payments to these environmental agencies was made in 2015-16. The legislative amendments effective 1 July 2015 mean the Minister may also make allocations from the MILL Trust Account to public entities or bodies for environmental purposes.
In 2015-16, the remaining cash balance of $94.62 million was transferred to the Sustainability Fund Account as per section 70F(2) of the Act . 
The table below provides details of the cashflow into and out of the Municipal and Industrial Landfill Levy Trust Account.
	 ($ million)	
Opening cash balance 	0.00	
Municipal and Industrial Landfill Levy funds transfer from EPA	150.93	
Agency Payments		
    Environment Protection Authority 	35.46	
    Sustainability Victoria	13.92	
    Waste and Resource Recovery Groups	6.93	
Total Agency payments	56.31	
Balance transferred to the Sustainability Fund Account	94.62	
Closing cash balance	0.00	

The MILL Trust Account did not exist prior to 1 July 2015. The EPA previously managed the collection, payment and financial reporting of municipal and industrial landfill levy revenue prior to the legislative amendments commencing 1 July 2015, and details can be found in their published annual reports up to 2014-15.
For the financial year 2015-16, a total of $201 million of landfill levies were accrued, as identified in Note 2 of Schedule A of the Financial Statements. The table below provide a reconciliation of the accrued landfill levies to funds transfer from EPA in the 2015-16 financial year.
	 ($ million)	
Landfill levies accrued	201.17	
Less: Amount receivable from EPA	97.24	
Add: Landfill levies for the 2014-15 financial year received in 2015-16	47.00	
Landfill levy funds transfer from EPA 	150.93	

Appendix 8: Sustainability Fund Account and Sustainability Fund Grants 2015-16
The Sustainability Fund Account is established under section 70F of the Environment Protection Act 1970 and is sourced from municipal and industrial landfill levy revenue. The purpose of the fund is to support the environmentally sustainable use of resources and best practice in waste management to help the state’s social and economic development, and to support community action or innovation on climate adaptation. 
The Premier and Minister jointly approve allocations from the Sustainability Fund Account consistent with section 70F of the Act. A published set of Sustainability Fund priorities and guidelines must be in place when new allocations are made. 
In response to the recommendations of the 2013 Ministerial Advisory Committee report on Waste and Resource Recovery Governance Reform, legislative amendments to section 70 of the Act effective 1 July 2015 saw management  of the Sustainability Fund transfer. 
DELWP has established a dedicated Sustainability Fund team to manage the fund, and a Sustainability Fund Committee to support the strategic and accountable management of the Sustainability Fund so that it best utilises landfill levy revenue collected for the specific legislated purposes of the fund. 
A new dedicated Sustainability Fund Trust Account was established at DELWP to receive municipal and industrial landfill levy revenue, as required under section 70F(1) of the Act. On 1 July 2015, the Sustainability Fund Trust Account received the closing cash balance of $383.76 million from the EPA’s Sustainability Fund Account (held in the Environment Protection Fund). During the remainder of 2015-16, payments from the MILL Trust Account ($94.62 million) and investment revenue ($11.10 million) were also received.
The financial transfer of the Sustainability Fund balance was reviewed and independently verified by KPMG before and after the 1 July 2015 transfer date.
The table below provides details of the cashflow totals into and out of the Sustainability Fund Trust Account, including a detailed breakdown of payments to programs.
	 ($ million)	
Opening cash balance 	0.00	
Transfer from EPA 	383.76	
Transfer from Municipal and Industrial Landfill Levy Trust Account	94.62	
Investment revenue	11.10	
Total receipts	489.47	
Living Victoria Water Rebate Program 	3.03	
A Cleaner Yarra and Port Phillip Bay	1.59	
Getting Full Value	2.21	
National Association of Charitable Recycling Organisations (NACRO)	1.20	
Threatened Species	6.00	
Climate Change Adaptation	0.20	
Climate Change Grants	0.80	
Climate Change Research 	0.23	
Victorian Adaptation and Sustainability Partnership	1.25	
Driving Investment for New Recycling	0.30	
Community Sustainability Infrastructure Fund	0.57	
Household Chemical Collection	2.65	
Love Food Hate Waste	0.32	
Community Education on Waste	0.09	
Victorian Litter Plan	0.05	
Optimising Kerbside Collection System	0.09	
Climate Change Engagement	0.20	
Metropolitan Local Government Waste and Recovery Fund	0.25	
Illegal Dumping Strikeforce Program	1.70	
Sustainability Fund Operations	0.50	
Total payments 	23.22	
Closing cash balance	466.25	

Note:
The Sustainability Fund Trust Account at DELWP did not exist prior to 1 July 2015. The EPA managed the collection, payment and financial reporting of Sustainability Fund Account revenue and expenditure prior to the legislative amendments commencing 1 July 2015, and details can be found in their published annual reports up to 2014-15.
Note that the transfer balance for the Sustainability Fund Account reported by EPA in 2014-15 was $384 million cash and $47 million in assets. As required by the legislated flow of municipal and industrial landfill levy revenue detailed in section 70D-70E of the amended Act, the $47 million was accrued to the newly established Municipal and Industrial Landfill Levy (MILL) Trust Account at DELWP as at 1 July 2015, rather than the Sustainability Fund. 
Sustainability Fund Grants 2015-16
Program - Climate Change Grants: Competitive
Recipient	Grant	Funding Support $	
City of Greater Geelong	Shellfish reefs for shoreline protection of highly erodible coasts	80,000	
East Gippsland Shire Council	East Gippsland Renewable Energy Feasibility with Innovative Options	80,000	
Hepburn Shire Council	Climate Resilient Recreation Facilities	67,670	
Moreland City Council	Working together to cool communities	80,000	
City of Yarra	Embedding Green Infrastructure Best Practice Toolkit	80,000	
Warrnambool City Council	Barwon South West Local Coastal Hazard Assessment (Phase 1) G21	80,000	
Yarra Ranges Council	Eastern Sporting Savers	30,000	
South Gippsland Shire Council	Investigation into the impact of climate change on Seawalls	80,000	
Warrnambool City Council	Barwon South West Local Coastal Hazard Assessment (Phase 1)	80,000	
Towong Shire Council	Banking on our solar future - Innovation for resilient communities	80,000	
Indigo Shire Council	Battery Storage Revolution	45,000	

Program - Climate Change Grants: Non-Competitive
Recipient	Grant	Funding Support $	
Mount Alexander Shire	Mount Alexander - Waste to Energy - Feasibility Study	10,000	
Pyrenees Shire Council	Beaufort Sustainable Water Use Plan	10,000	
Bass Coast Shire Council	Communities Making Energy Together across Southern Gippsland	10,000	
Gannawarra Shire Council	Be Cool in Gannawarra	10,000	
Golden Plains Shire Council	Online Mapping Tools and Templates - Fire, Conservation and Construction	10,000	
Borough of Queenscliffe	Supporting Queenscliff and Point Lonsdale to prepare for climate change	10,000	
Moyne Shire Council	East Beach Seawall Design	10,000	
South Grampians Shire	On for Young and Old: Kinders and Senior Citizens Facilities	10,000	
Moorabool Shire Council	Sustainable Buildings Initiative	10,000	
Northern Grampians Shire Council	Supporting Vulnerable Households Respond to Climate Risk	10,000	
Campaspe Shire Council	Campaspe Community Clubs Combat Climate Change	10,000	
West Wimmera Shire Council	Paving the way	10,000	
Moira Shire Council	Collaborative Climate Change Reporting	10,000	
South Gippsland Shire Council	Communities Making Energy Together across Southern Gippsland	10,000	
Horsham Rural City Council	Green Waste makes a Greener Place	9,000	
Macedon Ranges Shire Council	Designing a revolving energy fund for community-use buildings	9,500	
Murrindindi Shire Council	Collaborative Climate Change Reporting	10,000	
Central Goldfields Shire	Yarriambiack. Planning for the Future	10,000	
Benalla Rural City Council	Collaborative Climate Change Reporting	10,000	
Buloke Shire Council	Community Facilities Sustainability Audit	10,000	
Warrnambool City Council	Barwon South West Coastal Hazard Assessment Phase One (Non-Competitive)	30,000	
Wodonga Council	Collaborative Climate Change Reporting	10,000	
Alpine Shire Council	Plantation waste to energy	10,000	
Nillumbik Shire Council	Adapting to a New Climate	9,970	
Ararat Rural City Council	Stay in Play: Recreation Reserves and Climate Change Workshop	8,000	
Hepburn Shire Council	Carbon Free Communities	10,000	
Towong Shire Council	Beating the heat - cooling canopies for community resilience	10,000	
Indigo Shire Council	Collaborative Climate Change Reporting	10,000	
Rural City of Wangaratta	Collaborative Climate Change Reporting	10,000	
Mitchell Shire Council	Feasibility Study for the Chittick Park Micro-Grid Project	10,000	
Baw Baw Shire Council	Baw Baw Shire Community Responding to Climate Change	10,000	
Corangamite Shire	Corangamite Biolinks Project	10,000	
Surf Coast Shire Council	Local Food Program	10,000	
Swan Hill Rural City Council	Opportunity for a Regional Composting Facility - Swan Hill	10,000	

Program - Climate Change Research
Recipient	Grant	Funding Support $	
Climate KIC Australia, represented by the University of Melbourne	EU Climate KIC Summer School Grants	95,000	
Australian Research Council Centre of Excellence for Climate System Science, represented by the University of Melbourne	ARC Centre of Excellence Scholarship	70,000	
Australian Research Council Centre of Excellence for Climate System Science, represented by Monash University	ARC Centre of Excellence Scholarship	70,000	

Program – National Association of Charitable Recycling Organisations (NACRO)
Recipient	Grant	Funding Support $	
National Association of Charitable Recycling Organisations (NACRO)	Distributed to 22 charitable organisations across the state to mitigate the costs imposed on Victorian charities by illegal dumping 	$1.2m 	

Program - Threatened Species
Recipient	Grant	Funding Support $	
Arthur Rylah Institute	Roundsnout Galaxias recovery actions	27,000	
Arthur Rylah Institute	McDowalls Galaxias and East Gippsland Galaxias recovery actions	27,000	
Arthur Rylah Institute	Dargo Galaxias recovery actions	23,000	
Arthur Rylah Institute	Predator removal to save Shaw Galaxias from extinction	45,000	
Arthur Rylah Institute	Tapered Galaxias and West Gippsland Galaxias recovery actions	23,000	
Arthur Rylah Institute	Helping Hand: Glenelg Freshwater Mussel recovery actions	35,000	
Arthur Rylah Institute	Barred Galaxias recovery actions	45,000	
Arthur Rylah Institute	Determining threat management options for Master’s Snake	28,675	
Arthur Rylah Institute with Parks Victoria	Management to aid the survival of the highly localised Heath Skink in Victoria	51,500	
DELWP	Threat busting in key Jericho Wire-grass populations	10,300	
Arthur Rylah Institute with La Trobe University	Mapping and monitoring Caltha introloba Herbland Community	49,900	
DELWP with Royal Botanic Gardens Victoria	Putting Shiny Daisy-bush back in its place: Protecting diversity and unlocking the mysteries of low seed viability	32,000	
Trust for Nature with Parks Victoria and DELWP	Protecting the New Holland Mouse	51,050	
BirdLife Australia	Reintroduction and reinforcement of the endangered Black-eared Miner (Manorina melanotis) to the Victoria mallee: Translocation Plan	20,000	
DELWP with Amaryllis Environmental	Ballantinia’s road to recovery: Hydrological restoration and moving to new heights	52,600	
DELWP with Trust For Nature	Gippsland Plains EPBC Grassland ecosystems and flora species	136,200	
Trust For Nature (Vic) and Arthur Rylah Institute	Critical assessment and protection of Velvet Daisy-bush (Olearia pannosa subsp. cardiophylla)	61,700	
DELWP	Murray hardyhead recovery program	156,000	
La Trobe University with  Murray-Darling Freshwater Research Centre, Mt Buller-Mt Stirling Resort Management, Falls Creek Resort Management and Parks Victoria 	Saving the threatened Alpine and Mount Stirling stoneflies	105,498	
Zoos Victoria	Establishment of a self-sustaining captive insurance population of the Baw Baw Frog that supports wild recovery of the species.	46,530	
NCCMA with Fire Flood and Flora, Murray Darling Fresh Water Research Centre and Royal Botanical Gardens Victoria	Winged Peppercress - in-situ monitoring and ex-situ seedbank maintenance	13,851	
Hume City Council	Broadmeadows Valley Park - Geranium sp. 1	26,300	
Arthur Rylah Institute with Museum Victoria	Conservation management response to the arrival of the Amphibian Chytrid Fungus at the last fungus-free population of the nationally Vulnerable (Critically Endangered in Victoria) Alpine Tree Frog	19,958	
Port Phillip and Westernport CMA	Securing the future of Victoria's State Emblems	100,000	
Parks Victoria with DELWP	Yarra Ranges Endemic Shiny Nematolepis (Nematolepis wilsonii) Protection	32,000	
Trust For Nature (Vic)	Private Land Action for Threatened Species	32,700	
DELWP	Rare and Restored- Orchids of the Loddon Mallee	88,000	
Glenelg Hopkins CMA	Glenelg Hopkins Pine Wildling Removal	66,000	
DELWP with Tiverton Property Partners Pty Ltd, Zoos Victoria, Eastern Barred Bandicoot Recovery Team	Reintroduction of Eastern Barred Bandicoots into Tiverton, Western Victoria	25,000	
DELWP with Mt Rothwell Biodiversity Conservation Centre, Tidbinbilla Nature Reserve, Zoos South Australia	Supporting the captive insurance population of Southern Brush-tailed Rock Wallabies.	35,000	
DELWP	Discovery Bay Coastal Park Limestone Ridge, Orchid Conservation Project	25,000	
Arthur Rylah Institute	A survey protocol for the threatened Heath Mouse	15,000	
Parks Victoria	Moorabool Environmental Weed Control for Rocky Chenopod Communities	17,000	
DELWP with East Gippsland Rainforest Conservation Management Network	Lowland Rainforest: Littoral Rainforest and Coastal Vine Thickets of Eastern Australia - Measuring for Recovery	25,000	
Parks Victoria	Metallic Sun Orchid Protection	30,000	
DELWP with Parks Victoria            	Alpine Flora - managing threats from large introduced herbivores	50,000	
Trust for Nature (Vic) with Parks Victoria,  Royal Botanic Gardens, Australasian Native Orchid Society and Southern Peninsula Indigenous Flora and Fauna Association	Strategic Actions for Mornington Peninsula & Westernport Threatened Species & Communities	84,000	
Parks Victoria	Threatened orchids of Middle Yarra and the Warrandyte-Kinglake Habitat Corridor	50,000	
DELWP with Royal Botanic Gardens Victoria	Saving Plains Orchids	21,063	
DELWP with Cesar Pty Ltd	Genetic Sampling – Critical to Management Imperatives of a Highly Fragmented Threatened Woodland Population in Victoria	40,000	
Nature Glenelg Trust with Deakin University	Identifying the distribution of, and restoration opportunities for, the critically endangered Western Swamp Crayfish in the Grampians	15,000	
Parks Victoria 	Plenty Gorge Park Orchid Sites	25,000	
Yarra Ranges Council	Addressing stormwater threats to sensitive riparian ecosystems in Sassafras and Perrins Creek sub-catchment	70,000	
DELWP	Southern right whale data assessment and risk analysis (south-east population)	49,628	
Yarra Ranges Council	Pomaderris vacciniifolia protection Yarra Ranges	34,750	
DELWP with Trust For Nature	Gippsland Plains Threatened Species and Communities - 2.	93,800	
DELWP with Recovery Team and Trust For Nature	Threatened Invertebrates of the Western Strzeleckiis	30,100	
Nature Glenelg Trust	Strategic on-ground management to retain and enhance threatened flora and ecological communities of the Mortlake Common Flora Reserve.	13,000	
Parks Victoria	Eastern Barred Bandiocoot (EBB) Recovery - Pest Animal Control in the Back Paddock, Woodlands Historic Park	30,000	
Nature Glenelg Trust	Recovery of threatened species (Wimmera Bottlebrush and Dwarf Galaxias) in response to the permanent restoration of Gooseneck and Brady Swamps	30,000	
Royal Botanic Gardens Victoria	Wild Orchids of the Wimmera	141,572	
Arthur Rylah Institute	Protecting spawning conditions for Freshwater catfish at Tahbilk Lagoon	32,000	
GBCMA with Birds Bush and Beyond, GB CMA, Superb Parrot Action Group	Threatened woodland birds of the Goulburn-Murray irrigation district: Are we prioritising works in the right landscapes?	54,924	
Nature Glenelg Trust	Protecting stream habitat for the critically endangered Glenelg Freshwater Mussel	25,000	
DELWP with Parks Victoria and Royal Botanic Gardens	Threatened Orchids of the West Gippsland Coast	28,300	
DELWP and Royal Botanic Gardens Victoria	Basalt Rustyhood Translocation Project	25,000	
DELWP	Mapping review of optimal Orange-bellied Parrot habitat	40,000	
DELWP with Birdlife Australia	Expanded Orange-bellied Parrot winter survey	49,940	
Arthur Rylah Institute with NECMA, Fisheries Victoria 	Re-establishing Macquarie perch in the Ovens River	84,246	
Trust For Nature (Vic)	Survey of the Rayed Blue Butterfly (Wimmera form) and its food plant	15,200	
Nature Glenelg Trust	Protecting a western basalt plains endemic: conservation for the Salt-lake Tussock Grass at Lake Linlithgow Lake Reserve	12,000	
Nature Glenelg Trust	Rapid assessments informing critical recovery actions for threatened grassland flora of the Linear Reserves Program	4,000	
Greening Australia with Parks Victoria	Protecting Threatened Icons of the Volcanic Plains and Lakes - Salt-lake Tussock-grass	36,000	
DELWP with Mt Hotham Alpine Resort Management Board 	The design of a rock corridor linking Mountain Pygmy-possum habitat at Little Higginbotham, Mt Hotham - remove the barriers to the conservation movement.	25,000	
Trust For Nature (Vic)	Protection and augmentation of populations of seven threatened Orchid species on Trust For Nature covenanted properties in the Goldfields Bioregion	66,500	
Royal Botanic Gardens Victoria	Reducing extinction threat by seedbanking	6,000	
Nature Glenelg Trust	Protecting threatened orchids on the urban fringe: conserving the Basalt Leek-orchid at Maam Reserve	5,000	
Zoos Victoria	Captive-breeding to protect and recover the last lowland Leadbeater’s Possum population at Yellingbo Nature Conservation Reserve	19,375	
DELWP	On a Wing and Prayer- protecting the Loddon Mallee's most endangered butterflies	77,000	
Cesar Pty Ltd, Melbourne University,  Zoos Victoria, DELWP, Mt Rothwell Biodiversity and Interpretation Centre, Parks Victoria, DPWE (Tasmania), Victorian Eastern Barred Bandicoot Recovery Team	Eastern Barred Bandicoot Gene Widening Project	55,000	
Southern Otway Landcare Network	Landcare is Critical	10,000	
Cairnlea Conservation Reserve Committee of Management and Friends of Iramoo	Saving Six Grassland Species	12,000	
Friends of the Brisbane Ranges	Homes for Brush-tailed Phascogales	10,000	
East Gippsland Rainforest Conservation Management Network	Peri-urban littoral  rainforest stand improvement and community education program	19,000	
Parklands Albury Wodonga Ltd	West Wodonga Nest-box Corridors	20,000	
Friends of Campbells Creek Landcare Group (sponsored)	Resurrection of Dianella amoena along Campbells Creek	5,562	
Upper Goulburn Landcare Network (sponsored)	Ribbons of Remnant Roadsides	20,000	
Friends of the Bannockburn Bush Reserve (sponsored)	Caring for Bannockburn Bush	19,310	
Mid-Loddon Sub-Catchment Management Group (sponsored)	Citizens Science threatened species training, monitoring and habitat restoration program	14,406	
Mt. Worth and District Landcare Group Inc	Mt. Worth Strzelecki Gum Biolink	6,220	
Southern Otway Landcare Network	Community Based Monitoring of Threatened Species Habitat in the Otway Ranges	19,660	
Millewa-Carwarp Landcare Group	Rabbit eradication for the protection of threatened species	16,500	
Whroo Goldfields Conservation Management Network (sponsored)	Gliders in the Goldfields - Providing habitat and raising awareness for the endangered Squirrel Glider	16,000	
Campaspe River and Land Management group	Australian Anchor Plant- protection; propagation; and revegetation	15,779	
Middle Yarra Landcare Network (sponsored)	Future-proofing threatened species and their habitat within the Middle Yarra River catchment	19,968	
Friends of Brisbane Ranges Inc (sponsored)	Nest boxes for Brush-tailed Phascogale habitat and monitoring	9,300	
Cairnlea Conservation Reserves Committee of Management	Endangered Reptiles Habitat Restoration and Improvement	18,150	
Friends of Sassafras Creek Inc	Friends of Sassafras Creek battle weed infestations to save seven threatened species in Sassafras Creek.	19,900	
Southern Otway Landcare Network	Restoring the Woodland Habitat of the Leafy Greenhood on Cape Otway	17,204	
Kulkyne Way Landcare Group	Understanding Hopbush dieback and potential implications for Mildura Ogyris in north west Victoria	4,320	
Boolarra South Landcare (sponsored)	Boolarra South Landcare Threatened Species Training Workshops and on-ground Works Program	17,800	
Pinkerton Landcare & Environment Group Inc	Pinkerton Link Project	12,220	
Kowree Farm Tree Group (sponsored)	Kids creating habitat for Cockies	17,900	
Post Office Hill Action Hill Group (sponsored)	Delivering Habitat for Phascogales on Post Office Hill	4,460	
Northern Plains Conservation Management Network	Northern Plains Grasslands Threatened Flora & Fauna Project	19,991	
Friends of Nyah-Vinifera Forest - through Friends of the Earth Melbourne	Community surveying and weed removal in Nyah-Vinifera Park.	12,100	
Friends of Mallacoota (sponsored)	Hooded Plover Nesting Sites Protection at Betka Beach	2,000	
Ararat  Reginal Bio-Links Network Inc.	Restoration of the Native Grasslands Areas within part of  the Ararat Cemetery Creek Bio-Link	4,428	
St Arnaud Field Naturalist Club Inc.	Protection and Recruitment of the depleted iconic Grey Grass-tree (Xanthorrhoea glauca ssp. angustifolia)	8,500	
Dunmoochin Landcare Group	Expanding Orchid Conservation on Private Land in the Dunmoochin Landcare Region	8,642	
Dja Dja Wurrung Clans Aboriginal Corporation	Mt Barker Temperate Woodland Bird Restoration	19,900	
Hughes Creek Catchment Collaborative (sponsored)	Brush-tailed Phascogale	7,850	
Nullawil Landcare Group	Nulliwal Threatened Species Revegetation	2,640	
Lalbert Landcare Group (sponsored)	Goschen Bushland Reserve - Community action to protect threatened flora and fauna	18,000	
Greta Valley Landcare Group Inc.	Protecting Paddock Trees for Threatened Species	20,000	
Leigh Catchment Group	Saving the Growling Grass frog from Chytrid Fungus	10,640	
Milawa Markwood Oxley Landcare Group	Nesting boxes for hollow dependant threatened species in a fragmented landscape	13,500	
Strathbogie Ranges Conservation Management Network	Striped Legless Lizard Surveys - Cluster 8, North East Vic	17,000	
Yackandandah Landcare Group (sponsored)	Creating Homes and Habitat for Yackandandah Ck Threatened Species: A community-led initiative	14,050	
Friends of Turtons Creek (sponsored)	Turtons Creek survey for South Gippsland Spiny Crayfish and habitat rehabilitation	20,000	
Wedderburn Conservation Management Network	Conservation of malleefowl in the Wychitella NCR	16,665	
Birchip Landcare Group (sponsored)	Birchip Buloke Woodlands Protection	17,600	
South Beach Wetlands and Landcare Group	Lathams Snipe Project	14,440	
Gippsland Plains Conservation Management Network	Artificial Hollows for the Endangered Masked Owl	18,000	
Moorabool Catchment Landcare Group	Raising Awareness of Threatened Grasslands and Their Species in the Moorabool Region	20,000	
Fungimap Inc	Develop surveys, training and data collection systems to improve the conservation status of Clasping Hypocreoposis	20,000	
Koetong Landcare Group	Protecting habitat values and mitigating threats to the Summer Leek Orchid in  Pheasant Creek Reserve	16,740	
Friends of Kurth Kiln, Tall Astelia Recovery Group, Kurth Kiln Regional Park	Tall Astelia Recovery Project, Kurth Kiln Regional Park: Phase 1 - Plant Propagation	3,850	
Cardinia Catchment Landcare Inc.	Cardinia Creek Threatened Species Protection Program	19,500	
Mt Korong Eco Watch (sponsored)	Rewilding Korong Ridge – Short Story Nursery	8,800	
Christmas Hills Landcare Group (sponsored)	Christmas Hills Community - Protecting our Threatened Species.	19,915	
3 Creeks Landcare Group	Creating Growling Grass Frog and Orange-bellied Parrot habitat in 3 Creeks	20,000	
Latrobe Catchment Landcare Network	Gippsland Red Gum Woodland Species Win Hearts through Community Engagement	20,000	
Wooragee Landcare Group (sponsored)	Protecting Our Fauna Through Empowering People	12,700	
Warrenbayne Boho Land Protection Group Inc. (sponsored)	Railway Reserve Links	5,366	
Friends of Merri Creek	Matted and Tangled; Fine scale threat reduction for urban Matted Flax-lily populations	19,890	
Bass Valley Landcare Group	Holden the Ground - predator proofing and fox control at Holden Proving Ground	20,000	
Friends of Winton Wetlands (sponsored)	"Friends, Frogs and Fishes": practical community actions to help monitor and restore a wetland system	11,200	
Jack and Albert River Restoration Committee (sponsored)	Bringing The Community Together To Tackle Threatened Species Conservation	20,000	
Binginwarri Landcare Group (sponsored)	Protecting and enhancing Warm Temperate Rainforest	20,000	
Phillip Island Landcare Group Inc (sponsored)	Mapping, Monitoring, Protecting and Enhancing Phillip Island Coastal Moonah Woodlands	20,000	
Watson Creek Catchment Landcare Group (sponsored)	Protecting Dwarf Galaxias in Watson Creek Catchment	19,800	
Southwest Mornington Peninsula Landcare (sponsored)	Protect and Connect - Restoring bushland on properties adjoining Peninsula Gardens Bushland Reserve	20,000	
Powlett Project Landcare Group (sponsored)	Protecting the Powlett improving Australian Grayling and Orange Bellied Parrot habitat	20,000	
Friends of Winton Wetlands (sponsored)	"That's one giant leap!": increasing the availability of habitat for threatened arboreal mammals	10,600	
Friends of Terrick Terrick National Park Inc. (sponsored)	Fabian's Threatened Flora and Fauna Species Survey	9,480	
Entomological Society of Victoria (sponsored)	Survey for the Cryptic Sun Moth Synemon theresa	7,150	
Port Campbell Public Purposes Reserve (sponsored)	Port Campbell BioLinks – Threatened Species Protection	10,490	
Upper Maribyrnong Catchment Group (sponsored)	Protecting Remnants, Enhancing Biodiversity and Linking Corridors Project	20,000	
Castlemaine Landcare Group (sponsored)	Protecting Bibron's Habitat in Happy Valley Castlemaine, Stage 1	4,120	
Longwood Plains Conservation Management Network	Baits, boxes and biodiversity corridors for Bush-stone Curlews and Squirrel Gliders in Longwood Plains	19,725	
Mt Korong Eco-Watch (sponsored)	Rewilding Korong Ridge – Short-storey planting, retelling a threatened understorey.	16,550	
Violet Town Action Group	Honeysuckle Creek, Violet Town:  A Hot-spot for Threatened Fauna	19,156	
Rainbow and District Landcare Group Inc.	Preservation, Protection and Restoration of Rainbow's Buloke Populations	13,980	
Friends of the Eltham Copper Butterfly (sponsored)	Copper Fields: Sustaining Change for the Eltham Copper Butterfly	19,832	
Kinglake Landcare Group (sponsored)	Kinglake Landcare Threatened species monitoring, survey, and revegetation	19,000	
Hindmarsh Landcare Network	Project Hindmarsh 2016	20,000	
Southern Ranges Environment Alliance	Muddy Creek Headwaters Biodiversity Protection Program	20,000	
Kilmore Mechanics Institute and Free Lending Library Inc.	Kilmore Monument Hill Reserve Threatened Species Conservation & Community Education Project	11,660	
Ovens Landcare Network (sponsored)	What's in our patch - Silver Tea-tree	6,300	
Korumburra Landcare Group (sponsored)	Protecting and enhancing Giant Gippsland Earthworm and Strzelecki Gum Habitat in the upper Powlett catchment	20,000	
Meredith Police Paddocks Support Group (sponsored)	Meredith Police Paddocks Threatened Species Project	8,980	
Cardinia Environment Coalition Inc.	Improving the habitat for Southern Brown Bandicoot at Five Mile Reserve	13,860	
Mt Rothwell Landcare Volunteers Inc.	Let the threatened natives thrive: let’s be rabbit free	20,000	
Upper Loddon and Avoca Landcare Network	Ullina and Talbot remnant Pimelea spinescens and VVP Grassland Awareness raising and on-ground Conservation	9,220	
Ballarat Environment Network	Ballarat Environment Network Threatened Species Project	11,660	

Program – Smarter Resources Smarter Business
Recipient	Grant	Funding Support $	
Melba Support Services	Resource Assessments: energy efficiency assessment	4,285	
East Gippsland Shire Council	East Gippsland Renewable Energy Feasibility with Innovative Options	80,000	
Hepburn Shire Council	Climate Resilient Recreation Facilities	67,670	
Moreland City Council	Working together to cool communities	80,000	
City of Yarra	Embedding Green Infrastructure Best Practice Toolkit	80,000	
Warrnambool City Council	Barwon South West Local Coastal Hazard Assessment (Phase 1) G21	80,000	
Yarra Ranges Council	Eastern Sporting Savers	30,000	
South Gippsland Shire Council	Investigation into the impact of climate change on Seawalls	80,000	
Warrnambool City Council	Barwon South West Local Coastal Hazard Assessment (Phase 1)	80,000	
Towong Shire Council	Banking on our solar future - Innovation for resilient communities	80,000	
Indigo Shire Council	Battery Storage Revolution	45,000	
Skillinvest	Resource Assessments: energy efficiency assessment	4,600	
Del Re National Food Group	Resource Assessments: energy efficiency assessment	5,200	
Kyabram Cold Storage Pty Ltd	Resource Assessments: energy efficiency assessment	8,000	
Southern Ocean Mariculture	Resource Assessments: energy efficiency assessment	7,750	
Saltwater Coast Lifestyle Centre	Resource Assessments: energy efficiency assessment	5,700	
Wilson and Bradley	Resource Assessments: energy efficiency assessment	4,825	
Foamex Victoria Pty Ltd	Resource Assessments: energy efficiency assessment	 8,000	
The Comics Lounge	Resource Assessments: energy efficiency assessment	5,000	
The Leveson	Resource Assessments: energy efficiency assessment	6,000	
AF Gason	Resource Assessments: energy efficiency assessment	6,000	
E-Laundry and Dry Cleaning Service Pty Ltd (t.a. South Pacific Laundry)	Resource Assessments: energy efficiency assessment	8,000	
Western Private Hospital	Resource Assessments: energy efficiency assessment	8,000	
Goldacres Trading Pty Ltd	Resource Assessments: energy efficiency assessment	5,750	
Committee of Portland	Business Champions Project	9,800	
City of Kingston-Kingston Sustainable Business network	Business Champions Project	3,987	
East Gippsland Food Cluster-Event Series	Business Champions Project	9,650	
South Gippsland Shire Council-South Gippsland Manufacturing Event Series	Business Champions Project	9,500	

Program – Industry Waste Reduction
Recipient	Grant	Funding Support $	
Zilzie Wines Pty Ltd	Materials Efficiency Assessment	10,000	
Merino and Jumbuck	Materials Efficiency Assessment	11,415	
Southern Cross Recycling Group Pty Ltd	Materials Efficiency Assessment	12,990	
Alberton Timber and Treatment Plant Pty Ltd	Materials Efficiency Assessment	12,460	

Program – Litter Hotspots
Recipient	Grant	Funding Support $	
City of Greater Dandenong	Greater Dandenong cigarette butt litter prevention campaign	15,000	
Nillumbik Shire Council	Ramp up litter prevention – Eltham Skate Park	14,420	
Upper Yarra River Reserves Committee of Management	Plastic Bag Free Warburton – Litter prevention program	15,000	
Wyndham City Council	Hook, Line and Litter	9,930	
Friends of Williamstown Wetlands Incorporated	Wader Beach for birds not litter – tracking the plastic	14,300	
Maroondah City Council	Dorset Recreation Reserve Impact on Tarralla Creek	10,184	
Beautiful Brimbank/Friends of Kororoit Creek	Love Where you Live Drain project	13,880	
Hume City Council	Smart Bins, Stop Litter	14,985	
City of Whittlesea	Cover Your Load	14,300	

Appendix 9: Acronyms
AAS	Australian Accounting Standards	
AIIMS	Australasian Inter-service Incident Management System	
APU	Accredited Purchasing Unit	
ARI	Arthur Rylah Institute for Environmental Research	
CFA	Country Fire Authority	
CMA	Catchment Management Authority	
DEDJTR	Department of Economic Development, Jobs, Transport and Resources	
DELWP	Department of Environment, Land, Water and Planning	
DEPI	Department of Environment and Primary Industries	
DPC	Department of Premier and Cabinet	
DPCD	Department of Planning and Community Development	
DTF	Department of Treasury and Finance	
DTPLI	Department of Transport, Planning and Local Infrastructure	
EMS	Environmental Management System	
EO	Executive Officer	
EPA	Environment Protection Authority	
EWR	Environmental Water Reserve	
FMCF	Financial Management Compliance Framework	
FOI	Freedom of Information	
FMA	Financial Management Act 1994	
FRD	Financial Reporting Direction	
FTE	Full-Time Equivalent	
GMW	Goulburn Murray Water	
HVAC	Heating, Ventilation and Air Conditioning	
ICT	Information and Communications Technology	
IGEM	Inspector-General for Emergency Management	
IPAA	Institute of Public Administration Australia	
ISO	International Organisation for Standardisation	
MFB	Metropolitan Fire Brigade	
MW	Melbourne Water	
MoG	Machinery of Government	
N/A	Not Applicable	
NABERS	National Australian Built Environment Rating System	
NACRO	National Association of Charitable Recycling Organisations	
NEO	Networked Emergency Organisation	
OHS	Occupational Health and Safety	
PFF	Project Firefighter	
PPP	Public Private Partnership	
PV	Parks Victoria	
SCC	State Coordination Centre	
SES	State Emergency Service	
SGV	Surveyor-General Victoria	
SOE	Ministerial Statement of Expectation	
SV	Sustainability Victoria	
VBRC	Victorian Bushfires Royal Commission	
VCAT	Victorian Civil and Administrative Tribunal	
VGV	Valuer-General Victoria	
VGPB	Victorian Government Purchasing Board	
VIPP	Victorian Industry Participation Policy	
VPS	Victorian Public Service	
WoVG	Whole of Victorian Government	
		
Units of measure		
L	Litre	
G	Gigalitre	
MJ	Megajoules	
ML	Megalitre	
Ha	Hectare	

© The State of Victoria Department of Environment, Land, Water and Planning 2016

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