Advance to the Finance Minister – section 13 of Appropriation Act (No. 2) 2006-2007 (No. 5 of 2006-2007)

Administered by Department of Finance

Legislation au F2007L01934 Not in force Legislative Instrument

Legislation content

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 22 June 2007 and numbered 5 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 Payments to States, ACT, NT and local government – Outcome 1 appropriation for the Department of Agriculture, Fisheries and Forestry in                        Appropriation Act (No. 2) 2006-2007 be increased by $57,110,565.

Background

The background to the instrument is provided in the application made by the Department of Agriculture, Fisheries and Forestry 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: Australian Government Department of Agriculture, Fisheries and Forestry

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

 

Description:  Administered Payments to the States, ACT, NT and local government - Outcome 1

Description of Outcome: More sustainable, competitive and profitable Australian agricultural, food, fisheries and forestry industries

 

Source of Available Funds

2004-2005

2005-2006

2006-2007

 

$

$

$

Retained prior year Appropriations

 

 

14,394,145

Appropriation Act (No. 2)

464,986,000

309,807,000

360,106,000

Appropriation Act (No. 4)

(47,072,000)

334,137,000

222,469,000

Appropriation Act (No. 6)

(27,475,000)

 

-

Section 32 transfer

 

 

(23,894,000)

Section 32 transfer

 

 

2,375,000

TOTAL FUNDS AVAILABLE

390,439,000

643,944,000

575,450,145

 

 

 

 

TOTAL EXPENDITURE

326,084,157

485,632,153

567,129,782

 

 

 

 

TOTAL UNSPENT FUNDS

64,354,843

158,311,847

8,320,363

 

Funds Required:              $65,430,928

Funds Currently Unspent:              $8,320,363

Amount required from AFM:              $57,110,565

 

AFM Category:    Appropriation Act (No. 2) 2006-2007 Part 3 13 (1)(b)(ii)

 


Explanation of requirements from AFM:

The Department of Agriculture, Fisheries and Forestry (the Department) requires funds from the Advance to the Finance Minister to allow payment by 30 June 2007 of funds to States for a variety of items under Appropriation Act (No. 2) 2006-2007. 

Significant funds have been expended in providing for an increased take up in drought related exceptional circumstances assistance payments in areas which have been declared or extended since the finalisation of Appropriation Bill (No. 6) 2006-2007.  The Department is therefore seeking additional funds totaling $57.1 million to allow these payments to be made before 30 June 2007.

Urgent:

The Department is planning to make an estimated $65.4 million in payments before the end of the financial year.  As at 20 June 2007, the Department has funding available of $8.3 million.  Payments for a number of programmes are due before 30 June 2007 and are almost exclusively for reimbursement to States for expenditure already incurred on behalf of the Commonwealth.  There is a risk that the States will not make payments to farmers for exceptional circumstances payments and possibly blame the Australian Government for not providing the funds.

Unforeseen:

Exceptional circumstances declarations approved after the finalisation of the Additional Estimates bills were considered in the preparation of the Supplementary Additional Estimates bills.  No additional funding was provided for in the Supplementary Additional Estimates bills as new measures for exceptional circumstances totaling $54.6 million were capable of being funded from underspends within other programmes. 

Since that time, there has been a significant increase in the take up of exceptional circumstances assistance in areas which have been declared or expanded due to the severity and extended duration of the drought, increased government advertising, and promotion through the drought bus. The programme is demand driven and a further $61.5 million in payments is required by 30 June 2007 to meet the unforeseen increase in take-up of drought related assistance.  

 

 

 

Signed By Chief Finance Officer

 

NAME:

JOHN BRIDGE

SIGNATURE:

 

DATE:

21 June 2007

 

 

Overview

The Appropriation Act (No. 2) 2006-2007, enacted by the Parliament of Australia, introduced an urgent funding mechanism to address unforeseen and immediate financial needs throughout the fiscal year. Specifically, Section 13 of this Act authorises an Advance to the Finance Minister, providing up to $215 million to be deployed when there is an urgent need for additional expenditure that is either not covered or insufficiently provided for in the appropriation schedules. This provision is intended to ensure that the government can respond swiftly to unforeseen circumstances, such as unexpected natural disasters or significant policy shifts, without waiting for the protracted legislative process of supplementary appropriations. The policy objective is to maintain operational continuity and uphold the government's commitments by providing necessary funds promptly. In this context, the instrument dated 22 June 2007, determined an increase in funding for the Department of Agriculture, Fisheries and Forestry, illustrating the practical application of this contingency fund to address an unforeseen surge in drought-related assistance payments.

Scope and Application

The instrument, titled "Advance to the Finance Minister – Section 13 of Appropriation Act (No. 2) 2006-2007", serves to facilitate additional funding for the Department of Agriculture, Fisheries and Forestry for payments to states, the Australian Capital Territory, Northern Territory, and local governments under the 2006-2007 financial year's appropriation. Authorised by the annual Appropriation Acts, the Advance to the Finance Minister is a contingency fund allowing for urgent and unforeseen expenditures not initially provided for in the appropriation schedule. Specifically, this Act permits the Finance Minister to issue funds from this contingency, up to a limit of $215 million, if there is an urgent need for additional expenditure due to erroneous omissions, understatements, or unforeseen circumstances. The provision is exercised through a determination, which amends the appropriation schedule accordingly. The instrument designates the person holding the SES Band 2 position in the Financial Reporting and Cash Management Division of the Department of Finance and Administration as the authorised officer to exercise this power. This particular instrument increases the Payments to States, ACT, NT, and local government appropriation for the Department of Agriculture, Fisheries and Forestry by $57,110,565 to cover unforeseen drought-related expenses.

Key Provisions

The main operative sections of the Appropriation Act (No. 2) 2006-2007, particularly section 13, allow for an advance to be made to the Finance Minister for urgent and unforeseen expenditures not otherwise provided for in the appropriations schedule. Section 13 specifies that up to $215 million can be issued from the Advance to the Finance Minister if the Finance Minister is satisfied that there is an urgent need for additional expenditure due to either an erroneous omission or understatement in the appropriations schedule or because the additional expenditure was unforeseen until after the last practicable day to include it in the Bill before it was introduced into the House of Representatives (section 13(a) and (b)(i) & (ii)). When an advance is made, it has the effect of amending Schedule 2 of the Act to include the additional expenditure specified in the determination. The Act imposes specific obligations on the Finance Minister, requiring them to assess whether the conditions for issuing an advance are met. Once satisfied, the Finance Minister can issue the advance, which then amends the appropriation schedule to include the specified additional expenditure. The instrument also authorises a specified officer within the Department of Finance and Administration to exercise the power provided under section 13 of the Act. This officer's role includes determining and authorising the issuance of funds from the Advance to the Finance Minister when necessary. In terms of consequences for breach, the Act does not explicitly outline specific offences or penalties for misuse of the Advance to the Finance Minister. However, misuse or mismanagement of public funds generally can lead to various civil or criminal liabilities under other relevant laws, including the Public Governance, Performance and Accountability Act 2013 (Cth) or the Crimes Act 1914 (Cth). The potential penalties for such breaches can include fines and imprisonment, depending on the severity and intent of the breach.

Legal classification tags

Area of Law
Finance & Banking Law
Instrument
Statutory Instrument
Concepts
Definitions & Interpretation
Offence Provisions
Regulatory Standards

Interactions

Authorises

All Versions

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.