Determination to Reduce Appropriation Upon Request (No. 1 of 2007-2008)

Overview

The Determination to Reduce Appropriation Upon Request (F2007L03729) was enacted in 2007 to address the issue of excess appropriations within the Department of Families, Community Services and Indigenous Affairs (FaCSIA). This instrument was created under the authority of section 9 of the Appropriation Act (No. 1) 2004-2005 and the Appropriation Act (No. 1) 2005-2006, empowering the Finance Minister to reduce departmental appropriation items upon a written request from the relevant Minister or Chief Executive. The policy objective of these provisions is to ensure that excess appropriations are extinguished, which can occur due to reclassifications, efficiency savings, or the abolition of government programs before their appropriations are expensed. The determination issued by the Finance Minister cannot reduce an appropriation item by more than the amount requested or the balance remaining in the Consolidated Revenue Fund. In this specific case, the instrument directs a reduction of FaCSIA's departmental items by $48,105,925 under the 2004-2005 Act and by $32,269,929 under the 2005-2006 Act, following a request from the Minister for Families, Community Services and Indigenous Affairs due to reduced budgeted costs of services delivered by Centrelink.

Scope and Application

The "Determination to Reduce Appropriation Upon Request" instrument, dated 11 September 2007 and numbered 1 of 2007-2008, applies to the Department of Families, Community Services and Indigenous Affairs (FaCSIA) and is made pursuant to sections 9 of the Appropriation Act (No. 1) 2004-2005 and Appropriation Act (No. 1) 2005-2006. These provisions allow the Finance Minister to reduce a departmental appropriation upon receiving a written request from the relevant Minister or Chief Executive, applicable to the entity in question. The purpose of this instrument is to adjust the appropriations for FaCSIA in response to a request from the Minister for Families, Community Services and Indigenous Affairs, resulting from a decrease in the budgeted cost of services delivered by Centrelink under the Business Partnership Agreement. The reduction for Appropriation Act (No. 1) 2004-2005 is $48,105,925, and for Appropriation Act (No. 1) 2005-2006, it is $32,269,929. The instrument specifies the reduction of appropriation items for FaCSIA as requested, adhering to the legislative authority that the reduction cannot exceed the amount requested or the balance remaining in the Consolidated Revenue Fund.

Key Provisions

The main operative sections of the instrument, titled "Determination to Reduce Appropriation Upon Request" (subsection 9(1) of the Appropriation Act (No. 1) 2004-2005 and Appropriation Act (No. 1) 2005-2006), empower the Finance Minister to reduce a departmental appropriation for an entity upon receiving a written request from the relevant Minister or Chief Executive. This power is intended to address situations where an appropriation is in excess of what is needed, such as when an amount is reclassified and reappropriated, when efficiency savings lead to a program costing less than anticipated, or when a program is abolished before the appropriation is expensed. Specifically, section 9(1) allows for a reduction in the appropriation item, but not beyond the lesser of the amount requested by the responsible Minister or Chief Executive, or the balance remaining in the Consolidated Revenue Fund. The Act imposes certain obligations and requirements on the parties involved. The Minister responsible for a particular department or entity must submit a written request to the Finance Minister if there is an excess appropriation that needs to be extinguished. This request must detail the amount by which the appropriation should be reduced. Once the Finance Minister receives this request, they must assess it and issue a determination that reduces the appropriation by the requested amount or the remaining balance, whichever is less. Additionally, the entity in question, in this case the Department of Families, Community Services and Indigenous Affairs (FaCSIA), must be consulted during the preparation of the instrument, as required by the Legislative Instruments Act 2003. Failure to comply with the provisions of the Appropriation Acts or the terms of the determination could lead to various consequences. However, the explanatory statement does not explicitly detail offences, penalties, or civil/criminal consequences for breach. The focus of the Act appears to be on the procedural aspects of reducing excess appropriations rather than on punitive measures for non-compliance. It is important to note that while the statement does not specify penalties, breaches of statutory requirements generally could lead to legal actions or administrative consequences depending on the context and severity of the breach.