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Advance to the Finance Minister – section 13 of Appropriation Act (No. 2) 2005-2006 (No. 18 of 2005-2006)

Advance to the Finance Minister – section 13 of Appropriation Act (No. 2) 2005-2006 (No. 18 of 2005-2006)

Administered by Department of Finance

Legislation au F2006L02286 Not in force Legislative Instrument

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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 18 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 1 (which sets out the amounts appropriated); and

(b) The additional expenditure is not provided for, or is insufficiently provided for, in Schedule 1:

(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 1 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 Management Group, 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 the Administered Expenses – Outcome 1 appropriation for the Department of Transport and Regional Services in Appropriation Act (No. 2) 2005-06 be increased by $23,200,122.

Background

The background to the instrument is provided in the application made by the Department of Transport and Regional Services 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 Transport and Regional Services

Appropriation: Appropriation Acts (No. 2) 2005-06 and (No. 6) 2005-06

Description: Payments to States, ACT, NT and local government

Description of Outcome: Fostering an efficient, sustainable, competitive, safe and secure transport system

Source of Available Funds	2003-2004	2004-2005	2005-2006
	$	$	$
Appropriation Act No. 2	0	0	1,625,469,000.00
Appropriation Act No. 6	0	0	1,759,989,000.00
TOTAL FUNDS AVAILABLE	0	0	3,385,458,000.00
TOTAL EXPENDITURE	0	0	952,166,820.00
TOTAL UNSPENT FUNDS	0	0	2,433,291,180.00

Funds Required: $ 2,456,491,302

Funds Currently Unspent: $ 2,433,291,180

Amount required from AFM: $ 23,200,122

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

Explanation of requirements from AFM:

The AusLink programme was established in 2005-06 under the AusLink (National Land Transport) Act 2005. The former National Highways and Roads of National Importance and associated programmes had been funded from and drawn down against former Australian Land Transport Development Act 1988 special appropriations without the need to classify payments as grant payments to and through state and territory governments (SPPs) or other payments. The AusLink programme involves: SPP payments; payments to local government councils (non-SPP); and other payments for research, development and innovation projects (non-SPP). Funding for the AusLink programme is provided from Appropriation Act s (No. 2) 2005-06, (No. 4) 2005-06 and (No.6) 2005-06 under the items ‘New Administered Expenses’; ‘Specific Payments to States and Territories’, and ‘Payments to States, ACT, NT and local government’.

Current appropriations for ‘New Administered Expenses’ and ‘Payments to States, ACT, NT and local government’ were based on an expected project allocations available during the 2006-07 Budget update. However, payments are made based on actual invoiced amounts. The final allocations between these categories are now known.

Also, for budgetary purposes all payments under the AusLink Roads to Recovery programme have been treated as payments to local government, which in 2005-06 are being funded under the ‘New Administered Expenses’ item in Appropriation Acts (No. 2) 2005-06. However, some of these payments are paid directly to the State and Territories ($11.5m), in particular to the ACT (in lieu of there being any "local government" bodies) and payments to SA Local Government Grants Commission, which administers a certain proportion of local government payments within the State.

The issues outlined above has resulted in additional funds being sought under the ‘Payments to States, ACT, NT and local government’ item with an equal and offsetting reduction under the ‘New Administered Expenses’ item which will lapse at year end. The total level of funding required under the aggregate AusLink programme will remain unchanged.

Urgent :

Payments under the programme are made on a regular basis. Although a small number of invoice remain outstanding, once received payment cannot be delayed due to the requirement of the funding agreements with recipients. At this time, we anticipate all claims will need to paid by 30 June 2006

Unforeseen :

The final allocation between state and non-state components cannot finalised until towards the end of the financial year when final invoices are processed.

Notes on the instrument

The instrument provides that the appropriation item listed in column 1 for the Department of Transport and Regional Services be increased by the amount listed in column 3. The instrument specifies that the additional amount be provided to meet a commitment in relation to payments to the States, ACT, NT and local government for the AusLink programme.

Overview

The Appropriation Act (No. 2) 2005-06, enacted by the Parliament of Australia, introduced provisions to allow for urgent funding needs that may arise during the financial year. One such provision is the Advance to the Finance Minister under section 13, which serves as a contingency fund. This fund enables the Finance Minister to issue amounts up to a specified limit to meet urgent and unforeseen expenditure needs not adequately provided for in the initial appropriation schedules. The Act aims to ensure that the government can respond swiftly to financial requirements that emerge after the appropriation bills have been introduced, thereby maintaining operational continuity across various agencies. The policy objective is to provide flexibility and address potential shortfalls or oversights in the initial budget allocations, ensuring that critical services and commitments can be met without delay.

Scope and Application

The instrument relates to the allocation of an additional $23,200,122 under the Administered Expenses – Outcome 1 appropriation for the Department of Transport and Regional Services in the Appropriation Act (No. 2) 2005-06. This allocation is made via the Advance to the Finance Minister, a contingency fund established to provide urgent funding when needed. The provision is authorised by section 13 of the Appropriation Act (No. 2) 2005-06, which allows for the issuance of funds if the Finance Minister is satisfied that there is an urgent need for additional expenditure not provided for in the appropriation schedule, either due to an erroneous omission or because the expenditure was unforeseen until after the last practicable opportunity to include it in the Appropriation Bill. The instrument is effective as if the appropriation schedule had been amended to include the additional expenditure. The exercise of this power is delegated to a specific official within the Department of Finance and Administration. The instrument applies specifically to the Department of Transport and Regional Services and its AusLink programme, addressing the need for payments to states, the ACT, the NT, and local government that were not sufficiently provided for in the initial appropriations.

Key Provisions

Section 13 of the Appropriation Act (No. 2) 2005-06 authorises the Finance Minister to issue advances up to a limit of $215 million to meet urgent and unforeseen expenditure not provided for in the initial appropriation schedules. The provision can be exercised if the Finance Minister is satisfied that there is an urgent need for expenditure that is not provided for, or is insufficiently provided for, in Schedule 1. This can occur due to an erroneous omission or understatement, or because the additional expenditure was unforeseen until after the last day practicable to include it in the Appropriation Bill. The exercise of this provision effectively amends Schedule 1 to include the additional expenditure specified in the determination issued by the Finance Minister. The Act imposes several obligations on the Finance Minister and relevant departments. The Finance Minister must ensure that any advance issued under section 13 is justified by an urgent need for expenditure that is not otherwise covered in the appropriations schedules. This requires careful consideration and substantiation of the circumstances leading to the request for additional funds. Departments seeking funding from the Advance to the Finance Minister must provide detailed justification for the additional expenditure, including evidence that the need for funds is urgent and unforeseen, and that it cannot be met from existing appropriations. Failure to comply with the requirements of the Act may result in legal consequences. While specific offences and penalties are not detailed in the explanatory statement, breaches of appropriation laws can generally lead to both civil and criminal liabilities. Civil penalties may include fines, while criminal penalties can result in imprisonment, depending on the severity and intent behind the breach. The maximum penalties would be determined by the specific provisions of the Appropriation Act and other relevant legislation. The instrument issued under section 13 specifies that the Administered Expenses – Outcome 1 appropriation for the Department of Transport and Regional Services be increased by $23,200,122 to meet the additional funding requirements for the AusLink programme. This adjustment ensures that payments to states, the ACT, the NT, and local government under the programme can be made as required, despite the final allocations between state and non-state components being finalised later in the financial year. The instrument reflects the urgency of meeting these payments to honour existing funding agreements and maintain the integrity of the programme.

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

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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.

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