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 8 March 2006 and numbered 5 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 Cash 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 the New Administered Expenses, Outcome 1 appropriation for the Department of Transport and Regional Services in Appropriation Act (No. 2) 2005-06 be increased by $103,081,633.84.
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 Act (No. 2) 2005-06
Description: New Administered Expenses – Outcome 1
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 | 80,000,000.00 |
Advance to the Finance Minister (January 2006) | 0 | 0 | 6,476,039.74 |
TOTAL FUNDS AVAILABLE | 0 | 0 | 86,476,039.74 |
TOTAL EXPENDITURE | 0 | 0 | 85,227,593.58 |
TOTAL UNSPENT FUNDS | 0 | 0 | 1,248,446.16 |
Funds Required: $ 104,330,080.00
Funds Currently Unspent: $ 1,248,446.16
Amount required from AFM: $ 103,081,633.84
AFM Category: Appropriation Act (No. 2) 2005-2006 Part 3 13 (1)(b)(i)
Explanation of requirements from AFM:
The new administered expense appropriation for Outcome 1 provides for the non-Specific Purpose Payments (SPP) components of the new AusLink programme in its first year with subsequent funding to be provided from Appropriation Acts (Nos. 1 and 3).
The new AusLink programme was established in 2005-06 under the AusLink (National Land Transport) Act 2005. The original programme was funded from special appropriations. The programme primarily involves grant payments to and through state and territory governments (SPPs), payments to local government councils (non-SPP), and other payments for research, development and innovation projects (non-SPP).
In the 2005-06 Budget, funding for non-SPP payments to local governments was erroneously classified against ‘Specific Payments to States and Territories’ under Appropriation Act (No. 2). This classification caters only for payments to or for the states, not payments to local governments.
Urgent :
Payments under the programme are made on a regular basis. Invoices totalling $104.3 million have been received and payment cannot be delayed due to the requirement of the funding agreements with local councils, and various research bodies.
Unforeseen :
The legislative anomaly was not foreseen at the time of the 2005-06 Budget.
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 is provided for the purpose of meeting commitments under the AusLink program.