Explanatory Statement
Appropriation Act (No. 1) 2004-2005, Section 9 – Reduction of Appropriations Upon Request
Appropriation Act (No. 3) 2004-2005, Section 9 – 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 29 June 2006 and numbered 14 of 2005-2006.
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. 3)
2004-2005 enables the Finance Minister to make a determination reducing departmental appropriations made under that Act, upon receipt of a written request from the Minister responsible or, in the case of an agency in the Finance portfolio, the Chief Executive.
The provisions were included in the Appropriation Acts to enable excess departmental appropriation items, which do not automatically lapse, 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.
A determination issued by the Finance Minister pursuant to section 9 of Appropriation Act (No. 1) 2004-2005 and section 9 of Appropriation Act (No. 3) 2004-2005 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 the reduction of departmental outputs for the Office of National Assessment in Appropriation Act (No. 1) 2004-2005 by $1,310,000 and Appropriation Act (No. 3) 2004-2005 reduced by $3,290,000.
Background
On 14 June 2006, the Prime Minister, the Hon John Howard MP, wrote to the Minister for Finance and Administration seeking a reduction of the Office of National Assessment’s departmental outputs in Appropriation Act (No. 1) 2004-2005 by $1,310,000 and Appropriation Act (No. 3)
2004-2005 by $3,290,000. This reduction relates to funds appropriated for additional staff and associated infrastructure and support functions following the Inquiry into Australian Intelligence Agencies conducted by Mr Philip Flood AO in 2005. Due to the phasing of these functions over a three year period, timing of recruitment processes in the Office of National Assessment and delays in associated infrastructure and support services, the ONA had undrawn appropriation at 30 June 2005 that is no longer required.
Notes on the instrument
The instrument provides that the appropriation item in column 1 for the agency in column 2 be reduced in response to a request made by the Prime Minister in column 4 by the amounts listed in column 6.