EXPLANATORY STATEMENT
Appropriation Act (No. 1) 2012-2013
Advance to the Finance Minister Determination (No. 5 of 2012-2013)
Purpose of this Determination
The Advance to the Finance Minister (AFM) is provided under subsection 13(2) of Appropriation Act (No. 1) 2012-2013 (the Act). Section 13 provides that amounts can be issued from the AFM, up to a limit of $295 million. The Finance Minister must, however, be satisfied there is an urgent need for expenditure, in the current year, that is not provided for, or is insufficiently provided for, in Schedule 1 of the Act, for one of the reasons specified in paragraphs 13(1)(a) and (b).
The Finance Minister is satisfied, based on information provided by the Department of Regional Australia, Local Government, Arts and Sport (DRALGAS), that the additional expenditure was unforeseen until after the last day on which it was practicable to provide for it in the Bill for the Act, before the Bill was introduced into the House of Representatives: paragraph 13(1)(b). An explanation of the additional expenditure is provided in this determination under the heading ‘Consultation and Impact’ below.
The effect of the determination is that Schedule 1 of Appropriation Act (No. 1) 2012‑2013 will have effect as if it were amended as specified in the determination.
Advances to the Finance Minister generally
The section providing for the AFM is contained in the annual Appropriation Acts. It enables the Finance Minister to facilitate urgent and unforeseen expenditure that was not within the contemplation of Parliament when the Appropriation Act was passed, and was therefore not provided for in Schedule 1 of the Appropriation Act.
The background to the instrument was provided by DRALGAS in their application forms for funding from the AFM. DRALGAS have advised that the expenditure was unforeseen as the decisions were taken after the last day on which it was practicable to provide for expenditure for it in either Appropriation Bill (No. 1) 2012-2013 (introduced into the House of Representatives on Tuesday, 8 May 2012) or Appropriation Bill (No. 3) 2012-2013 (introduced into the House of Representatives on Thursday, 7 February 2013).
A determination made under subsection 13(2) of Appropriation Act (No. 1) 2012-2013 is a legislative instrument, but neither section 42 (disallowance) nor Part 6 (sunsetting) of the Legislative Instruments Act 2003 applies to the determination.
Statement of Compatibility with Human Rights
The annual Appropriation Acts perform an important constitutional function, by authorising the withdrawal of money from the Consolidated Revenue Fund for the broad purposes indentified in the annual Appropriation Acts.
However, as the High Court has emphasised, beyond this, the annual Appropriation Acts do not create rights and nor do they, importantly, impose any duties.
Given that the legal effect of annual Appropriation Acts is limited in this way, the increase of amounts in the annual Appropriation Acts through an AFM is not seen as engaging, or otherwise affecting, the rights or freedoms relevant to the Human Rights (Parliamentary Scrutiny) Act 2011.
Consultation and Impact
Consistent with Part 3 of the Legislative Instruments Act 2003, DRALGAS was consulted in the preparation of this Determination.
The instrument determines that, in Appropriation Act (No. 1) 2012‑2013, the administered item for Outcome 4 for DRALGAS is increased by $4,632,500.
The administered item for Outcome 4 can be applied for the purpose of contributing to achieving the Outcome, namely: Improved opportunities for community participation in sport and recreation, and excellence in high‑performance athletes, including through investment in sport infrastructure and events, research and international cooperation.
The additional amount for Outcome 4 is specifically provided to enable DRALGAS to make payments to service providers to improve opportunities for community participation in sport and recreation.
Overview
The Appropriation Act (No. 1) 2012-2013, enacted by the Parliament of Australia, was designed to address the need for urgent and unforeseen expenditure that was not accounted for in the initial appropriation schedule. This Act allows the Finance Minister to provide an advance to cover such expenditures, ensuring that the government can meet unexpected financial obligations that are critical for public services and infrastructure. The policy objective underpinning this Act is to provide flexibility in fiscal management to address unforeseen circumstances without the need for additional legislative amendments. The Advance to the Finance Minister (AFM) provision, as specified in subsection 13(2), allows the Finance Minister to facilitate these urgent expenditures, provided there is a demonstrated urgent need, and the expenditure was unforeseen after the last practicable opportunity to include it in the appropriation bills. This mechanism ensures that the government can respond promptly to urgent needs that arise after the appropriation process has concluded.
Scope and Application
The Advance to the Finance Minister Determination (No. 5 of 2012-2013) under the Appropriation Act (No. 1) 2012-2013 applies to the Finance Minister, who is authorised to make an advance of up to $295 million for urgent and unforeseen expenditure not covered in the Act's Schedule 1. This determination is specifically in response to an urgent need for additional funding identified by the Department of Regional Australia, Local Government, Arts and Sport (DRALGAS), which was not contemplated at the time of the Act's passage. The additional funding of $4,632,500 is designated for Outcome 4, aimed at enhancing community participation in sport and recreation, supporting high-performance athletes, and fostering international cooperation through investments in sport infrastructure and events. This Act applies at the Commonwealth level, and the determination itself does not fall under the disallowance or sunsetting provisions of the Legislative Instruments Act 2003. The determination is also accompanied by a Statement of Compatibility with Human Rights, asserting that the Act does not impose any duties or affect relevant rights or freedoms.
Key Provisions
The Advance to the Finance Minister (AFM) Determination (No. 5 of 2012-2013) under section 13(2) of the Appropriation Act (No. 1) 2012-2013 authorises an additional expenditure of up to $295 million. This provision allows the Finance Minister to issue funds for urgent and unforeseen expenditures not covered by the Act (subsection 13(2)). The determination specifies that the additional funds are intended for urgent needs identified by the Department of Regional Australia, Local Government, Arts and Sport (DRALGAS) that were not anticipated when the Appropriation Act was passed (subsection 13(1)(b)). Specifically, the determination increases the administered item for Outcome 4 by $4,632,500, which supports initiatives for improved community participation in sport and recreation.
The Act imposes obligations on the Finance Minister to ensure that any expenditure under the AFM is justified by an urgent need for unforeseen expenditure, as confirmed by DRALGAS. The determination highlights that the additional funds are necessary for specific outcomes identified by DRALGAS, such as enhancing community involvement in sports and recreation through investments in infrastructure and events. This requirement ensures that the AFM is used responsibly and only for legitimate, urgent needs that were not anticipated during the drafting of the Appropriation Act.
Under this Act, any misuse or unauthorised use of funds allocated through the AFM could potentially lead to legal consequences. Although the Act does not explicitly outline specific offences or penalties, breaches of such provisions could be subject to general legal actions under other relevant Australian laws, such as the Public Governance, Performance and Accountability Act 2013, which could include fines or other penalties for mismanagement of public funds. The Act ensures that the AFM is used strictly in accordance with its intended purpose, thereby maintaining fiscal discipline and accountability in government spending.