Cash Management

The Australian Government maintains a group of bank accounts at the Reserve Bank of Australia (RBA), known as the Official Public Account (OPA), the aggregate balance of which represents its daily cash position. The AOFM is responsible for management of the aggregate OPA balance.

The AOFM’s primary objective in managing the OPA balance is to ensure that the Australian Government is able to meet its financial obligations as and when they fall due. Other objectives are to minimise the cost of funding and to invest excess OPA balances efficiently.

Meeting the primary objective requires close attention to the within-year variability and uneven pattern of the Australian Government’s receipts and expenditures. There is often considerable cash flow volatility as a result of mismatches in the timing of revenue receipts and expenditures.

Cash proceeds not required for immediate purposes are invested in term deposits with the RBA. During periods when there are short-term funding needs, these can be met by increasing the volume of Treasury Notes on issue and/or redeeming term deposits.

As part of the Australian Government’s banking arrangements with the RBA, the RBA provides an overdraft facility to the government. The terms of this facility provide that it may only be accessed to cover unexpected temporary shortfalls of cash (for example, to cover a sudden previously unplanned outlay). This means that it is used very infrequently.

Last updated: 25 October 2017