EXPLANATORY STATEMENT
STATUTORY RULES 1988 NO. 352
ISSUED BY THE AUTHORITY OF THE MINISTER FOR DEFENCE SCIENCE AND PERSONNEL
ARMY AND AIR FORCE CANTEEN SERVICE REGULATIONS (AMENDMENT)
The Army and Air Force Canteen Service Regulations (“the Regulations”) made under the Defence Act 1903 provide for the establishment and operation of canteens for the Army and Air Force, including the application and investment of moneys.
Subregulation 23A(2) of the Regulations enables the Army and Air Force Canteen Service Board of Management (“the Board”) to invest moneys not immediately required by the Board in specified forms of investment.
Regulation 23B of the Regulations provided that the Board could not, except with the approval of the Minister, enter into contracts involving the payment or receipt of amounts exceeding $250,000.
Until recently it had been assumed that the restriction in regulation 23B did not apply to investment contracts because of the operation of subregulation 23A(2). However, the Attorney-General’s Department advised that provisions such as subregulation 23A(2) do not obviate the requirement to obtain ministerial approval for investment contracts where the amount invested exceeds the specified contract limit in provisions such as regulation 23B.
There is a requirement for the Board to invest at short notice amounts up to $500,000. This Statutory Rule accordingly amends regulation 23B to impose a separate limit of $500,000 for investment contracts entered into under subregulation 23A(2). The previous limit of $250,000 is retained for contracts other than investment contracts.
The Statutory Rule also makes drafting amendments to correct outdated references.
The Statutory Rule comes into operation on the date of gazettal
Overview
The Army and Air Force Canteen Service Regulations (Amendment) Statutory Rule 1988, enacted to address an interpretation issue regarding the limitations on contract values for the Army and Air Force Canteen Service Board of Management, was issued by the authority of the Minister for Defence Science and Personnel. The primary objective of this Statutory Rule is to clarify the scope of investment contracts and ensure that the Board can enter into investment contracts up to $500,000 without requiring ministerial approval, while retaining the $250,000 limit for other types of contracts. This amendment rectifies an oversight in the original regulations and ensures that the Board can efficiently manage its investments and financial commitments within the legislative framework. The Statutory Rule also includes necessary drafting amendments to correct outdated references, ensuring the Regulations remain current and applicable to modern financial practices.
Scope and Application
The Army and Air Force Canteen Service Regulations (Amendment) Statutory Rule 1988 No. 352 amends the existing Army and Air Force Canteen Service Regulations made under the Defence Act 1903. This amendment is specifically concerned with the financial operations of the Army and Air Force Canteen Service Board of Management. The Board is responsible for the establishment and operation of canteens for the Army and Air Force, including the application and investment of funds. The primary change introduced by this Statutory Rule is the adjustment of the financial threshold for ministerial approval of contracts. Previously, the Board required ministerial approval for contracts exceeding $250,000, a threshold that has been retained for contracts not related to investment. However, the amendment now imposes a separate limit of $500,000 for investment contracts, reflecting the need for the Board to invest at short notice up to this amount. This amendment ensures that the Board can manage its investments more effectively while still adhering to the necessary regulatory oversight. The Statutory Rule also includes minor drafting amendments to correct outdated references. It is applicable nationally as it is a Commonwealth regulation and comes into operation on the date of gazettal.
Key Provisions
The main operative sections of the Statutory Rules 1988 No. 352, as amended by the Army and Air Force Canteen Service Regulations (Amendment), address the Board's authority to enter into contracts and invest funds. Regulation 23A(2) allows the Board to invest moneys not immediately required in specified forms of investment, while regulation 23B previously set a limit of $250,000 for contracts involving payments or receipts, unless approved by the Minister. The amendment introduces a new subregulation 23B(2A) that imposes a separate limit of $500,000 for investment contracts, differentiating them from other types of contracts that retain the $250,000 limit.
The obligations and requirements imposed by these regulations on the Board are primarily centred around the need to seek ministerial approval for contracts exceeding specified amounts. Specifically, the Board must obtain approval from the Minister for any contract involving payments or receipts over $250,000, except for investment contracts, which now have a higher threshold of $500,000. This amendment ensures that the Board can manage short-notice investments up to $500,000 without ministerial approval, while maintaining the need for approval for higher-value contracts that do not involve investment. The Board must also comply with the specified forms of investment outlined in subregulation 23A(2).
The Statutory Rules include provisions for offences, penalties, or consequences in the event of non-compliance. While the specific penalties are not detailed in the provided explanatory statement, breaches of the Defence Act 1903 or the Regulations could potentially result in both civil and criminal consequences. The Board's failure to adhere to the regulatory requirements, such as exceeding the specified limits for contracts without appropriate approval, may lead to legal action. The maximum penalties would depend on the nature and severity of the breach, with potential consequences including fines, legal sanctions, and administrative repercussions that could impact the Board's operations and reputation.