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Advance to the Finance Minister – section 13 of Appropriation Act (No. 2) 2006-2007 (No. 3 of 2006-2007)

Advance to the Finance Minister – section 13 of Appropriation Act (No. 2) 2006-2007 (No. 3 of 2006-2007)

Administered by Department of Finance

Legislation au F2007L01678 Not in force Legislative Instrument

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Explanatory Statement

Appropriation Act (No. 2) 2006-2007, 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) 2006-2007”, dated 4 June 2007 and numbered 3 of 2006-2007.

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) 2006-2007, 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, in the current year, 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 Bill for this Act before that 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) 2006-2007 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) 2006-2007.

Purpose of the instrument

The instrument determines that the Administered Expenses – Outcome 1 appropriation for the Department of Health and Ageing in Appropriation Act (No. 2) 2006-2007 be increased by $12,026,000.

Background

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

APPLICATION FOR FUNDS - ADVANCE TO THE FINANCE MINISTER 2006-2007

Agency: Department of Health and Ageing

Appropriation: Appropriation Act (No. 2) 2006-2007

Payments to the States, ACT, NT and local government

Description: Administered expenses – Outcome 1

Description of Outcome: The incidence of preventable mortality, illness and injury in Australians is minimised

Source of Available Funds	2004-2005	2005-2006	2006-2007
	$	$	$
Appropriation Act (No. 2)	210,006,000	253,217,000	236,139,000
Appropriation Act (No. 4)	6,463,000	-	-
Prior Year Section 8 Retention	-	-	3,357,807
TOTAL FUNDS AVAILABLE	216,469,000	253,217,000	239,496,807

TOTAL EXPENDITURE	205,937,000	219,836,000	232,189,035 1

TOTAL UNSPENT FUNDS	10,532,000	33,381,000	7,307,772

1 Expenditure as at 30 May 2007

Funds Required: $19,333,772

Funds Currently Unspent: $7,307,772

Amount required from AFM: $12,026,000

AFM Category:

Appropriation Act (No. 2) 2006 –2007 Payments to States, ACT, NT and local government Part 3 13 (1)(b)(ii)

Explanation of requirements from AFM:

On 28 November 2006 a decision was made to fund the purchase of Human Papillomavirus vaccine (HPV). However, this decision only authorised the purchase of vaccines under the special appropriation and determined that there needed to be a comeback on the actual implementation costs, including payments to the States And Territories. In February 2007 it was decided to provide $16,180,000 in 2006-07 to pay States and Territories to administer the vaccine as provision of the vaccines to school children is provided through the public school system and funded by State and Territories. The addition of this commitment to other commitments under Appropriation Act (No. 2) 2006-2007 for Payments to States, ACT, NT and local government means that there will be insufficient funds to cover the Australian Government’s remaining liabilities.

Urgent:

The Department is required to make approximately $19,333,772 in payments before the end of the financial year, with $13,600,000 due by 7 June 2007. The balance of payments will be made throughout June 2007. As at 30 May 2007, the Department has funding available of $7,307,772.

This shortfall in funding is due to the unforeseen payment of $16,180,000 for HPV in February 2007, of which funding of $12,026,000 is provided in Appropriation Bill (No. 6) 2006-2007, which has yet to receive royal assent. The balance of $4,154,000 comes from savings identified by the Department during the financial year.

An Advance to the Finance Minister of $12,026,000 is required in order to facilitate payments that are due before the anticipated royal assent of Appropriation Bill (No. 6) 2006-2007.

Unforeseen:

The decision to provide additional funding of $16,180,000 for HPV was made after the preparation of the Additional Estimates Bills and could not, therefore, be appropriated in Appropriation Act (No. 4) 2006-2007. Although partial funding for this item is included in Appropriation Bill (No. 6) 2006-2007, the Department is required to make various payments prior to royal assent being given to this Bill.

Signed By Chief Finance Officer
NAME: (block capitals please)
SIGNATURE:
DATE:

Overview

The Appropriation Act (No. 2) 2006-2007, enacted by the Parliament of Australia, was introduced to address the problem of unforeseen and urgent expenditures that may arise during the financial year, which are not adequately covered in the initial appropriations outlined in the annual budget. This Act provides a mechanism, known as the Advance to the Finance Minister, which allows for an additional allocation of up to $215 million to be issued if certain conditions are met. Specifically, section 13 of the Act allows for the issue of funds from this contingency pool if there is an urgent need for expenditure that is either not provided for or is insufficiently provided for in the appropriations schedule due to either an erroneous omission, understatement, or the expenditure being unforeseen until after the appropriation bill was introduced into the House of Representatives. The policy objective behind this provision is to ensure that the government can respond swiftly to urgent financial requirements without the need for additional legislative amendments, thereby maintaining fiscal flexibility and continuity of essential services. The instrument, dated 4 June 2007, determines an increase in the Administered Expenses – Outcome 1 appropriation for the Department of Health and Ageing by $12,026,000, to cover unforeseen payments related to the Human Papillomavirus vaccine. This funding was necessitated by the unexpected decision in February 2007 to fund the vaccine, which led to an urgent need for additional payments to the States and Territories for administering the vaccine. The Advance to the Finance Minister was exercised to facilitate these payments before the anticipated royal assent of Appropriation Bill (No. 6) 2006-2007, which partially addresses the funding requirement.

Scope and Application

The Advance to the Finance Minister, as outlined in Section 13 of the Appropriation Act (No. 2) 2006-2007, applies to the Finance Minister, who is authorised to issue amounts from a central contingency fund to cover urgent and unforeseen expenditures throughout the financial year. The Act allows the Finance Minister to issue funds up to a limit of $215 million, provided there is an urgent need for expenditure not accounted for in Schedule 2, either due to an erroneous omission or understatement, or because the additional expenditure was unforeseen until after the last practicable day to include it in the Bill before its introduction into the House of Representatives. This Act applies at the Commonwealth level and is exercised via the issuance of a determination that amends Schedule 2 of the Appropriation Act (No. 2) 2006-2007 accordingly. The instrument dated 12 February 2003 designates a specific officer within the Department of Finance and Administration to exercise this power. The application of the Act is further extended through subordinate instruments that specify the exact circumstances under which funds can be issued, ensuring flexibility in addressing urgent financial needs.

Key Provisions

Section 13 of the Appropriation Act (No. 2) 2006-2007 allows for the issuing of an advance to the Finance Minister, up to a limit of $215 million, when there is an urgent need for additional expenditure not already accounted for in Schedule 2. This additional expenditure must either be due to an erroneous omission or understatement in the appropriation or because it was unforeseen until after the last practical opportunity to include it in the Bill before its introduction into the House of Representatives. The provision operates under the assumption that if the Finance Minister is satisfied with the necessity and urgency of the expenditure, the advance will be issued as if Schedule 2 had been amended to include the additional expenditure. The Act imposes specific obligations on the Finance Minister, who must be satisfied of both the urgency and the unforeseen nature of the expenditure before issuing an advance. This includes verifying that the expenditure is not already provided for in Schedule 2 and ensuring that the additional funds are necessary to meet the urgent needs of the government agencies involved. Additionally, the Act designates a specific official within the Department of Finance and Administration to exercise the power provided under Section 13, thus formalising the process through which the advance can be issued. Failure to comply with the provisions of the Act, or misuse of the Advance to the Finance Minister, could potentially lead to legal consequences. However, the explanatory statement does not detail specific offences, penalties, or civil/criminal consequences for breaches of the Act. The absence of detailed penalties suggests that any legal action would be determined on a case-by-case basis, potentially involving general statutory offences for misuse of public funds or mismanagement of appropriations, though the exact penalties would depend on the nature and extent of the breach.

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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