I am pleased to present my first annual report as Secretary to the Commonwealth Grants Commission. The CGC’s main role is to provide independent advice to the government each year on the distribution of the GST among the states and territories. The CGC’s advice is based upon the principle of horizontal fiscal equalisation – that is, to distribute the GST to give all states the fiscal capacity to provide their citizens with a comparable standard of services.

The CGC’s advice for this year was provided in its Report on GST Revenue Sharing Relativities 2021 Update, publicly released on 25 March 2021. The 2021 Update was the first incorporating new legislative arrangements governing the distribution of the GST. In developing its advice, the Commission assessed state fiscal capacities across 20 revenue and expenditure categories, drawing on data from over 150 sources. CGC staff consulted closely with state treasuries on new and emerging issues, including the effect of COVID-19 on state budgets.

During the year, CGC staff supported the Commission in producing Occasional Papers on COVID-19 and state tax reform. Staff also supported the Chairperson’s attendance at meetings of the Council on Federal Financial Relations and Heads of Treasuries.

Within the agency, the CGC progressed the vital work of transforming its ICT systems using funding secured in 2018-19. A focus this year was the migration of ICT systems to a cloud-based environment, while work continued on modernising the CGC’s core ICT platform for analysing state fiscal data. Work commenced on a broader strategy for improving communication with stakeholders and the community, which will include the redevelopment of the CGC’s website.

I was also particularly pleased to support an initiative from staff to develop the CGC’s first Reconciliation Action Plan (RAP). A RAP working group has now been established and our CGC Reflect RAP 2021–23 has been submitted to Reconciliation Australia for endorsement.

A key member of the CGC leadership team, Tony Nichols, announced he would be retiring soon after the end of the financial year. I would like to thank Tony for his outstanding leadership in the CGC over the past 15 years. Finally, I would like to thank all CGC staff for the professional approach they brought to their work through a year of considerable change for the organisation.

(Signed) Jonathan Rollings
Secretary