Legal Research
Legislations
Advance to the Finance Minister – section 13 of Appropriation Act (No. 2) 2005-2006 (No. 17 of 2005-2006)

Advance to the Finance Minister – section 13 of Appropriation Act (No. 2) 2005-2006 (No. 17 of 2005-2006)

Administered by Department of Finance

Legislation au F2006L02275 Not in force Legislative Instrument

Select Document

Explanatory Statement

Appropriation Act (No. 2) 2005-06, Section 13 – Advance to the Finance Minister

The instrument to which this explanatory statement relates

This explanatory statement relates to an instrument (the instrument) entitled “Advance to the Finance Minister – Section 13 of Appropriation Act (No. 2) 2005-2006”, dated 27 June 2006 and numbered 17 of 2005-2006.

The legislative authority under which the instrument is made

The Advance to the Finance Minister is a provision authorised by the annual Appropriation Acts and made available to the Finance Minister as a central contingency fund to provide urgent funding to agencies throughout the financial year.

In Appropriation Act (No. 2) 2005-06, the Advance to the Finance Minister is provided for under section 13. This section indicates that amounts can be issued from the Advance to the Finance Minister, up to a limit of $215 million, if the Finance Minister is satisfied that:

(a) There is an urgent need for expenditure that is not provided for, or is insufficiently provided for, in Schedule 2 (which sets out the amounts appropriated); and

(b) The additional expenditure is not provided for, or is insufficiently provided for, in Schedule 2:

(i) Because of an erroneous omission or understatement; or

(ii) Because the additional expenditure was unforeseen until after the last day on which it was practicable to provide for it in the Appropriation Bill before the Bill was introduced into the House of Representatives.

Exercise of the provision via the issue of a determination, has effect as if Schedule 2 of Appropriation Act (No. 2) 2005-06 were amended to make provision for the additional expenditure specified in the determination.

In an instrument dated 12 February 2003, the Finance Minister has authorised the person holding the position of SES Band 2, Financial Reporting and Management Division, in the Department of Finance and Administration to exercise the power provided for under section 13 of Appropriation Act (No. 2) 2005-06.

Purpose of the instrument

The instrument determines that Administered Expenses – Outcome 1, appropriation for the Department of Environment and Heritage in Appropriation Act (No. 2) 2005-06 be increased by $5,073,000.

Background

The background to the instrument is provided in the application made by the Department of Environment and Heritage for funding from the Advance to the Finance Minister. The application is reproduced below.

APPLICATION FOR FUNDS - ADVANCE TO THE FINANCE MINISTER 2005-2006

Agency: Department of the Environment and Heritage

Appropriation: Appropriation Act (No. 2) 2005-06

Description: Administered expenses – Specific Payments to the States and Territories

Description of Outcome: Outcome 1 – “The environment, especially those aspects that are matters of national environmental significance, is protected and conserved.”

Source of Available Funds	2003-04	2004-05	2005-06
	$	$	$
Appropriation Act No. 2	1,530,000	23,774,951	33,340,000

TOTAL FUNDS AVAILABLE	1,530,000	23,774,951	33,340,000

TOTAL EXPENDITURE	1,530,000	23,621,541	32,913,000

TOTAL UNSPENT FUNDS	$Nil	$Nil1	427,000

1 Lapsed appropriation was $153,410.

Funds Required: $5,500,000

Funds Currently Unspent: $ 427,000

Amount required from AFM: $5,073,000

AFM Category: Appropriation Act (No. 2) 2005-2006 Part 3 13 (1)(a) and (b)

Explanation of requirements from AFM:

On 13 May 2005 the Prime Minister and the Premier of Tasmania signed the Supplementary Tasmanian Regional Forest Agreement, also known as The Tasmanian Community Forest Agreement. The agreement outlines the establishment of a new market based program (The Forest Conservation Fund) to protect and manage 45,600 hectares of forest on private land.

Funding for the Tasmanian Community Forest Agreement is currently in the Contingency Reserve (CR) under the administrative control of the Department of Finance and Administration. The funding was placed in the CR due to the market sensitivities involved with the pending land purchases and the need for details of the program to remain commercial in confidence.

The Supplementary Tasmanian Regional Forest Agreement (between the State of Tasmania and the Commonwealth of Australia) provides details of a commitment that the Commonwealth is to make a payment to the Tasmanian Government in paragraph 26:

“The Commonwealth will provide one-off funding to the State of $5.5 million in 2005-06 from program funding…”

Agreement has been subsequently reached on 16 June 2006 to make the $5.5m payment.

A tax invoice is now to hand for the payment.

The Department of the Environment and Heritage (DEH) has an obligation to make this payment prior to 30 June 2006.

Urgent:

Consistent with the Supplementary Tasmanian Regional Forest Agreement the Minister for the Environment and Heritage has now entered into a formal agreement with the Tasmanian Minister for Primary Industries and Water to provide the one-off payment of $5.5m in 2005-06 as outlined above.

Unforeseen:

Delays in the release of the strategic plan for the Forest Conservation Fund program and the Tasmanian election earlier in the year have delayed the implementation of the program. As a consequence the signing of the agreement “in relation to Funding for ongoing monitoring and management support services to owners of covenanted land participating in the Forest Conservation Fund was not signed until 16 June 2006.

Funding for the Tasmanian Community Forest Agreement is currently in the CR under the administrative control of the Department of Finance and Administration. The next available opportunity for appropriation of this programme funding to the Department of the Environment and Heritage is in 2006-2007.

There is no other available Bill 2 funding in 2005-06 to meet this contractual obligation.

Notes on the instrument

The instrument provides that the appropriation item listed in column 1 for the Department of Environment and Heritage be increased by the amount listed in column 3. The instrument specifies that the additional amount be provided to meet a commitment from the Commonwealth to provide a one-off payment to the State for the funding of ongoing monitoring and management support services to owners of forested land protected by covenants.

Overview

The Appropriation Act (No. 2) 2005-06 was enacted to provide for the appropriation of funds for the financial year 2005-2006 and addresses the need for urgent and unforeseen expenditures that may not have been initially included in the appropriation schedules. This Act is part of a series of annual appropriations laws that allocate funds to government departments and agencies, and it was introduced by the Parliament of Australia. The policy objective of the Act is to ensure that the government can adequately fund its operations, including responding to unforeseen circumstances and urgent needs that arise during the financial year. Section 13 of the Act, which allows for an advance to the Finance Minister, was specifically introduced to provide a contingency fund that can be quickly and efficiently used to address such urgent and unforeseen requirements, ensuring continuity of essential services and obligations. The explanatory statement details an instrument under Section 13 of the Act, which authorised an additional appropriation of $5,073,000 to the Department of Environment and Heritage to meet a commitment under the Supplementary Tasmanian Regional Forest Agreement. This funding was required to support ongoing monitoring and management of forested land protected by covenants, an obligation that was unforeseen and urgent due to delays in program implementation and the timing of the Tasmanian election. This provision exemplifies how the Act facilitates the government's ability to meet its commitments promptly, even when those commitments arise unexpectedly within the fiscal year.

Scope and Application

The Advance to the Finance Minister, as provided under Section 13 of the Appropriation Act (No. 2) 2005-06, is a contingency fund available to the Finance Minister to cater for urgent and unforeseen expenditures not accounted for in the budget appropriations. This provision allows for the issuance of funds up to a limit of $215 million, contingent upon the Finance Minister's satisfaction that the additional expenditure is necessitated by an urgent need or unforeseen circumstances. The exercise of this provision through the issuance of a determination functions as if the additional expenditure were amended in Schedule 2 of the Appropriation Act (No. 2) 2005-06. The Finance Minister has delegated the authority to exercise this power to a designated official within the Department of Finance and Administration. The specific instrument in question authorises an increase of $5,073,000 for Administered Expenses – Outcome 1 for the Department of Environment and Heritage, to fulfil a commitment under the Supplementary Tasmanian Regional Forest Agreement. This increase is to support the funding of ongoing monitoring and management support services for forested land protected by covenants, which was unforeseen due to delays in the release of the strategic plan and the Tasmanian election. The instrument ensures that this critical obligation is met within the financial year 2005-06, despite the constraints in the original appropriations.

Key Provisions

The key operative sections of the Advance to the Finance Minister under Section 13 of the Appropriation Act (No. 2) 2005-06 (sections 13(1)(a) and 13(1)(b)) allow for the issuance of funds up to $215 million from the Advance to the Finance Minister to meet urgent, unforeseen expenditures that are not provided for in Schedule 2. Specifically, section 13(1)(a) stipulates that the Finance Minister can authorise the release of funds if there is an urgent need for expenditure not accounted for in the appropriations schedule. Section 13(1)(b) further requires that the additional expenditure not be accounted for due to an erroneous omission or understatement in Schedule 2, or because the expenditure was unforeseen until after it was practicable to include it in the Appropriation Bill. The issuance of such a determination has the effect of amending Schedule 2 to include the additional expenditure. The obligations imposed by this Act require the Finance Minister to ensure that any funds released from the Advance to the Finance Minister meet the criteria outlined in section 13. The Minister must be satisfied that the additional expenditure is both urgent and unforeseen before issuing a determination. Additionally, the Department of Finance and Administration, through the person holding the SES Band 2 position in the Financial Reporting and Management Division, is authorised to exercise the power to issue such determinations. This person must act in accordance with the directions provided by the Finance Minister and the requirements of section 13. Breaches of the provisions in section 13 of the Act may lead to various consequences. While the explanatory statement does not specify criminal penalties, it does highlight the need for strict adherence to the criteria for issuing determinations. Failure to comply with the requirements could result in financial mismanagement or the inability to meet contractual obligations, potentially leading to legal repercussions. The maximum penalty for breaches of the appropriation laws generally involves fines and imprisonment, although the specific penalties would depend on the nature and severity of the breach as determined by relevant legislation.

Area of Law: Finance & Banking Law
Instrument: Statutory Instrument
Concepts: Definitions & Interpretation; Reporting & Disclosure Obligations; Offence Provisions

Interactions

Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.

Legislation content