Explanatory Statement
Appropriation Act (No. 1) 2004-2005, subsection 9(1) – Reduction of appropriations upon request
Appropriation Act (No. 1) 2005-2006, subsection 9(1) – Reduction of appropriations upon request
The instrument to which this explanatory statement relates
This explanatory statement relates to an instrument (the instrument) entitled “Determination to Reduce Appropriation Upon Request”, dated 11 September 2007 and numbered 1 of 2007-2008.
The legislative authority under which the instrument is made
Section 9 of Appropriation Act (No. 1) 2004-2005 and section 9 of Appropriation Act (No. 1)
2005-2006 enable the Finance Minister to make a determination reducing a departmental item for an entity upon receipt of a written request from the Minister responsible or, in the case of an entity the Finance Minister is responsible for, the Chief Executive.
The provisions were included in the Appropriation Acts to enable excess departmental appropriation items to be extinguished.
Excess appropriation may arise where, for example:
- An amount is reclassified and appropriated again under another kind of appropriation;
- Efficiency savings result in a programme costing less than expected; and
- A programme under Government policy is abolished prior to the appropriation being expensed.
In accordance with subsection 9(1) of Appropriation Act (No. 1) 2004-2005 and Appropriation Act (No. 1) 2005-2006, a determination issued by the Finance Minister cannot reduce an appropriation item by more than the lesser of the amount requested by the responsible Minister or Chief Executive (as appropriate), and the balance of the appropriation item remaining in the Consolidated Revenue Fund.
Purpose of the instrument
The instrument directs that departmental items for the Department of Families, Community Services and Indigenous Affairs (FaCSIA) in Appropriation Act (No. 1) 2004-2005 be reduced by $48,105,925. The instrument also directs that departmental items for FaCSIA in Appropriation Act (No. 1) 2005-2006 be reduced by $32,269,929.
Background
On 18 July 2007, the Minister for Families, Community Services and Indigenous Affairs wrote to the Minister for Finance and Administration seeking a reduction of FaCSIA’s departmental items under Appropriation Act (No. 1) 2004-2005 by $48,105,925 and Appropriation Act (No. 1) 2005-2006 by $32,269,929. These amounts are due to a reduction in the budgeted cost of services delivered by Centrelink under the Business Partnership Agreement.
The Administrative Arrangements Order made on 27 January 2006 resulted in the Department of Family and Community Services becoming the Department of Families, Community Services and Indigenous Affairs.
Notes on the instrument
The instrument provides that the appropriation items in column 1 for the entity in column 2 are reduced in response to a request made by the Minister in column 4 by the amounts listed in column 6.
In accordance with the Legislative Instruments Act 2003, FaCSIA was consulted in the preparation of this instrument.