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Advance to the Finance Minister – section 14 of Appropriation Act (No. 1) 2008-2009 (No. 2 of 2008-2009)

Advance to the Finance Minister – section 14 of Appropriation Act (No. 1) 2008-2009 (No. 2 of 2008-2009)

Administered by Department of Finance

Legislation au F2008L04452 Not in force Legislative Instrument

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Explanatory Statement

Appropriation Act (No. 1) 2008-2009, Section 14 – 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 14 of Appropriation Act (No. 1) 2008-2009”, dated 24 November 2008 and numbered 2 of 2008-2009.

The legislative authority under which the instrument is made

The Advance to the Finance Minister (AFM) is a provision contained in the annual Appropriation Acts. It enables the Finance Minister to facilitate urgent and unforeseen expenditure that was not within the contemplation of Parliament when the Appropriation Act was passed and is therefore not provided for in Schedule 1 of the Appropriation Act.

In Appropriation Act (No. 1) 2008-2009, the Advance to the Finance Minister is provided for under section 14. The discretionary power is exercisable upon the Finance Minister’s satisfaction of the matters specified in section 14. This section indicates that amounts can be issued from the Advance to the Finance Minister, up to a limit of $295 million, if the Finance Minister is satisfied that there is an urgent need for expenditure, in the current year, that is not provided for, or is insufficiently provided for, in Schedule 1 of that Act. The qualifying circumstances on the discretion of the Finance Minister to issue additional amounts under this provision is contained in subsections 14(1)(a) and (b) of that Act. This application satisfied the Finance Minister that the additional expenditure was not provided for because of an erroneous omission.

Exercise of the power via the issue of a determination has effect as if Schedule 1 of Appropriation Act (No. 1) 2008-2009 were amended to make provision for the additional expenditure specified in the determination.

Purpose of the instrument

The instrument determines that the Administered Item for the Bureau of Meteorology in Appropriation Act (No. 1) 2008-2009 be increased by $20,000,000. The additional amount is provided to enable payments under the Australian Government Modernisation and Extension of Hydrologic Monitoring Systems Program.

Background

The background to the instrument is provided in the application made by the Bureau of Meteorology for funding from the Advance to the Finance Minister. The application is reproduced below.

APPLICATION FOR ADVANCE TO THE FINANCE MINISTER - 2008-2009

Agency: Bureau of Meteorology

Appropriation: Appropriation Act (No. 1) 2008-2009

Description: Administered Expenses

Outcome: Outcome 1: Australia benefits from meteorological and related science and services

Source of Available Appropriations	2006-2007	2007-2008	2008-2009
	$	$	$
Appropriation Act (No. 1) 2008-2009	-	-	-

TOTAL APPROPRIATIONS AVAILABLE	-	-	-

TOTAL AMOUNT SPENT	-	-	-
TOTAL UNSPENT APPROPRIATIONS	-	-	-

Appropriations Required: $ 20,000,000.00

Appropriations Available: $ 0.00

Amount required from AFM: $ 20,000,000.00

AFM Category: Appropriation Act (No.1) 2008-2009, Part 3, Section 14, (1)(a)

Explanation of requirements from AFM:

The Bureau of Meteorology (Bureau) was appropriated $20 million under Appropriation Act (No. 2) 2008-2009 for the Australian Government Modernisation and Extension of Hydrologic Monitoring Systems Program (the Program). The objective of the Program, as originally set out in the National Plan for Water Security, is to “assist water data collecting agencies (public and private)” to modernise and extend their water resource monitoring systems.

Funding for this program was incorrectly included in Appropriation Act (No. 2) 2008-2009 due to a misunderstanding of the intended recipients – use of the term “agencies” was mistakenly interpreted as relating to only State and Territory Government agencies. As projects are evaluated on a competitive tender basis via merit based selection, recipients of funding under this program can include both public and private sector entities as named in the Water Regulations 2008 as made under the Water Act 1997.

The Finance Minister has agreed that funding for this program ought to be provided under Appropriation Act 1 and as a consequence, provision has been made in Appropriation Bill (No. 3) 2008-2009 for the current financial year and Appropriation Bill 1 in future financial years.

Urgent:

Due to the error in the budgetary process, the Bureau has no relevant appropriation item under Appropriation Act (No. 1) 2008-2009 to allow the Program to function as per government policy. Funding under Appropriation Bill (No. 3) 2008-2009 will not be available until royal assent occurs; this is not expected until April 2009. The urgency of the request relates to the following two types of Program payment activities that will occur in 2008-09.

The first payment type of $1.54 million, approved by the Minister for Climate Change and Water in late 2007-2008, is for the appointment of water information co-ordinators in each State and the Northern Territory. The relevant co-ordinators have either provided signed funding deeds awaiting counter signature by the Bureau or are expecting the Bureau to resume negotiation of contractual terms. These funding deeds indicate initial payments due on contract signature, early November 2008, with progressive milestone payments throughout the financial year. All contracts expire on the 30 June 2009, each contract having varying milestone achievement and payment dates.

The second payment type of $18.46 million, is for grant recipients whose applications are currently being assessed. The call for Program grant applications closed on the 17th October 2008 and proposals with a total value of over $43 million were received. Subject to approval by the Minister for Climate Change and Water in November 2008, the first payments will be due in December of this year. Further payments linked to milestone achievements, will be scheduled throughout the financial year as per best practice recommendations. All contracts will expire on the 30 June 2009, each contract having varying milestone achievement and payment dates.

Erroneous Omission:

In order to complete the Program, funding should have been provided under Appropriation Act
(No. 1) 2008-2009. Unfortunately poor use of the term “agencies” led to the Program being funded as a Special Purpose Payment (SPP) under Appropriation Act (No. 2) 2008-2009. In effect this means that the moneys can only be used to fund public sector entities instead of the intended beneficiaries, which include all those public and private entities named in the Water Regulations 2008.

Overview

The Appropriation Act (No. 1) 2008-2009, enacted by the Parliament of Australia, provides mechanisms to address urgent and unforeseen expenditures that were not contemplated during the passage of the Act. Specifically, Section 14 of this Act allows the Finance Minister to issue an advance to facilitate such expenditures, ensuring that critical government functions can continue without delay. This provision addresses the gap created by unexpected needs that necessitate immediate funding beyond what is outlined in the initial appropriation schedule. The policy objective is to enable the government to respond swiftly to unforeseen circumstances, ensuring continuity and effectiveness of public services and programs. The Advance to the Finance Minister under Section 14 of the Appropriation Act (No. 1) 2008-2009 was exercised to provide an additional $20 million to the Bureau of Meteorology for the Australian Government Modernisation and Extension of Hydrologic Monitoring Systems Program. This funding was necessary due to an erroneous omission in the original appropriation, where the intended recipients of the funding were misconstrued. The urgency arose because payments for water information coordinators and grants were due shortly, and without this advance, the Bureau would have been unable to fulfill its obligations under the program, thereby impacting the effective implementation of critical government initiatives.

Scope and Application

The Advance to the Finance Minister (AFM) provision in the Appropriation Act (No. 1) 2008-2009 enables the Finance Minister to facilitate urgent and unforeseen expenditure not provided for in Schedule 1 of the Act, up to a limit of $295 million. This discretionary power is exercisable 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. The instrument in question determines that the Administered Item for the Bureau of Meteorology be increased by $20,000,000 to enable payments under the Australian Government Modernisation and Extension of Hydrologic Monitoring Systems Program, which was erroneously omitted from Appropriation Act (No. 1) 2008-2009. The urgency arises from the need to make payments for the appointment of water information co-ordinators and grants to recipients whose applications are currently being assessed, with the first payments due in December 2008. The Act applies to the Finance Minister who has the discretion to issue additional amounts under section 14 if certain conditions are met. The Act’s jurisdictional reach is limited to the Commonwealth of Australia and specifically to the budgetary process as outlined in the Appropriation Acts. There are no explicit exclusions or exemptions stated in the Act, but the exercise of the power is contingent on the satisfaction of specific conditions related to urgency and erroneous omission. The application of this Act may be extended or restricted through subordinate instruments, although no such instruments are mentioned in the provided explanatory statement.

Key Provisions

The Appropriation Act (No. 1) 2008-2009 contains an important provision known as the Advance to the Finance Minister (AFM), found under section 14. This section allows the Finance Minister to issue funds for urgent and unforeseen expenditures not covered by the initial appropriation schedule. Specifically, up to $295 million can be allocated if the Finance Minister is convinced that there is an urgent need for such expenditure that was not accounted for in the original appropriation schedule (section 14(1)). The Finance Minister’s decision to issue additional funds is based on the criteria outlined in subsections 14(1)(a) and 14(1)(b) of the Act. In this case, the instrument dated 24 November 2008, numbered 2 of 2008-2009, determines that the Administered Item for the Bureau of Meteorology should be increased by $20,000,000 to facilitate payments under the Australian Government Modernisation and Extension of Hydrologic Monitoring Systems Program. The obligations imposed by the Act on the Finance Minister are significant. The Minister must ensure that any additional funds issued under the AFM provision are for urgent needs that are genuinely unforeseen and not accounted for in the original appropriation schedule. The decision to allocate funds must be based on a thorough assessment of the circumstances, ensuring that the additional expenditure is necessary and complies with the criteria set out in the Act. In this instance, the decision to increase the Bureau of Meteorology’s appropriation was made due to an erroneous omission, where the intended recipients of the funds were misunderstood, leading to the Program being funded under the wrong appropriation act. Failure to comply with the requirements of the AFM provision can result in serious consequences. Although the explanatory statement does not specify the exact penalties for non-compliance, breaches of appropriation acts can generally lead to both civil and criminal penalties, including fines and imprisonment. The exact penalties would depend on the nature and severity of the breach, as well as any additional legislation that may apply. In practice, the Finance Minister’s decisions under the AFM provision are closely scrutinised to ensure that they adhere to the legislative requirements and the urgent needs they are meant to address.

Area of Law: Administrative Law; Finance & Banking Law
Instrument: Statutory Instrument
Concepts: Definitions & Interpretation; Offence Provisions; Licensing & Registration; Reporting & Disclosure Obligations; Regulatory Standards

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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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