EXPLANATORY STATEMENT
Select Legislative Instrument 2005 No. 169
Defence Act 1903
Army and Air Force Canteen Service Amendment Regulations 2005 (No. 1)
Paragraph 124(1)(o) of the Defence Act 1903 (the Act), provides in part that the Governor-General may make regulations for the establishment, management, operation and control of canteens.
The Army and Air Force Canteen Service Regulations 1959 (the Principal Regulations), made under the Act, provide for the establishment and operation of the Army and Air Force Canteen Service (the Canteen Service). The purposes of the Canteen Service include the supply of goods, facilities and services to, or for the recreation of, members of the Army or Air Force and persons employed in Army or Air Force installations, their dependents, visitors to the installations and cadets. The Principal Regulations also establish a Board of Management which has the power, with the Treasurer's written approval, to borrow money from sources other than the Commonwealth, if considered necessary for the conduct of the Canteen Service.
The Financial Framework Legislation Amendment Act 2005 (the FFLA Act), amended the enabling Acts of all statutory authorities subject to the Commonwealth Authorities and Companies Act 1997 that contained a power to borrow from financial markets. The amendments transfer the approval power from the Treasurer to the Minister for Finance and Administration.
The amendments to subregulation 22(1) of the Principal Regulations align the Principal Regulations with the transfer of the approval power from the Treasurer to the Minister for Finance and Administration. The amendments also permit the Minister for Finance and Administration to delegate his powers or functions to officials, as provided for in the FFLA Act.
Details of the proposed Regulations are outlined in the Attachment.
The Act specifies no conditions that need to be met before the power to make the proposed Regulations may be exercised.
The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The Regulations commence on the day after they are registered on the Federal Register of Legislative Instruments.
The Department of Finance and Administration has been consulted in the making of this instrument.
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ATTACHMENT
Army and Air Force Canteen Service Amendment Regulations 2005 (No. 1).
Regulation 1 identifies these Regulations as the Army and Air Force Canteen Service Amendment Regulations 2005 (No. 1).
Regulation 2 provides that the Regulations commence on the day after they are registered on the Federal Register of Legislative Instruments.
Regulation 3 provides that the amendments to the Army and Air Force Canteen Service Regulations 1959 (the Principal Regulations) are contained in Schedule 1.
Schedule 1
Item 1 amends regulation 3 by inserting a definition of "Finance Minister" to mean the Minister administering the Financial Management and Accountability Act 1997.
Item 2 amends subregulation 22(1) by omitting "Treasurer" and inserting "Finance Minister".
Item 3 inserts a note to subregulation 22(1) to advise that the Finance Minister's powers under the subregulation may be delegated to an official as prescribed in regulation 29.
Item 4 inserts a new regulation 29, which provides that the Finance Minister may delegate any of his powers or functions by written instrument to an official within the meaning of the Financial Management and Accountability Act 1997. Subregulation 29(2) provides however, that the official must comply with the Finance Minister's directions when exercising any delegated powers or functions.
Overview
The Defence Act 1903, enacted by the Commonwealth Parliament, provides the framework for the establishment, management, operation, and control of canteens, including the Army and Air Force Canteen Service. The Act allows the Governor-General to make regulations for these purposes, which were initially established by the Army and Air Force Canteen Service Regulations 1959. These regulations outline the operation of the Canteen Service, which supplies goods, facilities, and services for the recreation of military personnel, their dependents, and visitors, among others. The Financial Framework Legislation Amendment Act 2005 amended the enabling Acts of statutory authorities to transfer the borrowing approval power from the Treasurer to the Minister for Finance and Administration. Consequently, the Army and Air Force Canteen Service Amendment Regulations 2005 (No. 1) were introduced to align the Principal Regulations with these amendments, replacing references to the Treasurer with the Minister for Finance and Administration and allowing for delegation of the Minister’s powers as provided for in the Financial Management and Accountability Act 1997.
Scope and Application
The Defence Act 1903 provides the legislative basis for the establishment, management, operation, and control of canteens, and the Army and Air Force Canteen Service Amendment Regulations 2005 (No. 1) were enacted to align the Army and Air Force Canteen Service Regulations 1959 with the Financial Framework Legislation Amendment Act 2005. The Regulations apply to the Army and Air Force Canteen Service, which is responsible for providing goods, facilities, and services to members of the Army or Air Force, their dependents, visitors, and cadets, as well as to persons employed in Army or Air Force installations. The Regulations also apply to the Board of Management of the Canteen Service, which has the authority to borrow funds for the conduct of the Canteen Service. The Regulations are applicable nationally as they are made under the Commonwealth Defence Act 1903. The Regulations do not specify any exclusions, exemptions, or thresholds. The Regulations extend the application of the Principal Regulations through subordinate instruments, allowing the Minister for Finance and Administration to delegate his powers or functions to officials.
Key Provisions
The Army and Air Force Canteen Service Amendment Regulations 2005 (No. 1) amend the Army and Air Force Canteen Service Regulations 1959 (the Principal Regulations) to align with recent legislative changes. Regulation 1 identifies these Regulations as the Army and Air Force Canteen Service Amendment Regulations 2005 (No. 1). Regulation 2 specifies that the Regulations commence on the day after they are registered on the Federal Register of Legislative Instruments. The key amendments are detailed in Schedule 1.
Schedule 1 introduces several changes. Firstly, it inserts a definition of "Finance Minister" in regulation 3, meaning the Minister administering the Financial Management and Accountability Act 1997 (Item 1). The most significant amendment is in subregulation 22(1), where "Treasurer" is replaced with "Finance Minister" (Item 2). This change reflects the transfer of the approval power from the Treasurer to the Minister for Finance and Administration as mandated by the Financial Framework Legislation Amendment Act 2005. Additionally, a note is inserted into subregulation 22(1) to clarify that the Finance Minister's powers under this subregulation may be delegated to an official as prescribed in a new regulation 29 (Item 3). Regulation 29 itself is inserted to provide that the Finance Minister can delegate any of his powers or functions by written instrument to an official within the meaning of the Financial Management and Accountability Act 1997, provided that the official complies with the Finance Minister's directions when exercising any delegated powers or functions (Item 4).
The obligations imposed by these Regulations primarily concern the Board of Management of the Canteen Service. They must now seek approval from the Finance Minister rather than the Treasurer for any borrowings deemed necessary for the conduct of the Canteen Service. Furthermore, the Regulations permit the Finance Minister to delegate his powers or functions to officials, which must be done in accordance with the Finance Minister's directions. Failure to comply with these obligations may result in unauthorised financial transactions or mismanagement of the Canteen Service's funds.
While the Regulations themselves do not specify explicit offences or penalties for non-compliance, breaches of financial management and accountability laws can have serious consequences. The Financial Management and Accountability Act 1997, along with related Commonwealth legislation, could impose both civil and criminal penalties for unauthorised borrowings or financial mismanagement. Such penalties could include fines, imprisonment, or both, depending on the severity and intent behind the breach. The precise penalties would be determined by the courts in the context of any prosecutions arising from non-compliance with these Regulations.