Explanatory Statement
Appropriation Act (No. 2) 2004-2005, Section 11 - Reduction of Appropriations Upon Request
Appropriation Act (No. 4) 2004-2005, Section 11 - 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 19 of 2005-2006.
The legislative authority under which the instrument is made
Section 11 of Appropriation Act (No. 2) 2004-2005 and Section 11 of Appropriation Act (No.4) 2004-2005 enable the Finance Minister to make a determination reducing non-operating appropriations in these Acts, 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 Finance Chief Executive gave written authorisation on 7 December 2005 to the Chief Financial Officer of the department to request written determinations from the Finance Minister to reduce appropriations for Finance under section 11 of Appropriation Act (No. 2) 2004-2005 and section 11 of Appropriation Act (No. 4) 2004-2005.
The provisions were included in the Appropriation Acts to enable excess non-operating 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 11 of Appropriation Act (No. 2) 2004-2005 and Section 11 of Appropriation Act (No.4) 2004-2005 cannot reduce an appropriation item by more than the lesser of the amount requested by the responsible Minister, Chief Executive or Officer (as appropriate), and the balance of the appropriation item remaining in the Consolidated Revenue Fund.
Purpose of the instrument
The instrument directs that equity injection for the Department of Finance and Administration (DOFA) in Appropriation Act (No. 2) 2004-2005 be reduced by $27,600,000, administered assets and liabilities in Appropriation Act (No.2) 2004-2005 be reduced by $310,000 and administered assets and liabilities in Appropriation Act (No.4) 2004-2005 be reduced by $190,000.
Background
On 23 May 2006, the Chief Financial Officer of the Department of Finance and Administration, Mr Dominic Staun, wrote to the Minister for Finance and Administration seeking a reduction of the Department of Finance and Administration’s equity injections in Appropriation Act (No. 1)
2004-2005 by $27,600,000. On the 21 June 2006 Mr Staun wrote again, to the Minister for Finance and Administration requesting a reduction of the Department of Finance and Administration’s administered assets in Appropriation Act (No.2) 2004-2005 by $310,000 and administered assets in Appropriation Act (No.4) 2004-2005 by $190,000. These reductions relate to funds that have been re-appropriated to Finance for the Anzac Park East and West project ($27,600,000); cost savings in relation to superannuation payments to former state railway employees ($310,000); and the reclassification and re-appropriation of funding for the National Portrait Gallery ($190,000).
Notes on the instrument
The instrument provides that the appropriation items in column 1 for the agency in column 2 be reduced in response to a request made by the Officer in column 4, by the amount listed in column 6.