Explanatory Statement
Appropriation Act (No. 1) 2005-2006, Section 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 04 January 2007 and numbered 3 of 2006-2007.
The legislative authority under which the instrument is made
Section 9 of Appropriation Act (No. 1) 2005-2006 enables 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 agency in the Finance portfolio, 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(5) and subsection 9(6) of 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 the departmental item for the Department of Education, Science and Training (DEST) in Appropriation Act (No. 1) 2005-2006 be reduced by $10,115,000.
Background
On 29 September 2006, the Minister for Education, Science and Training wrote to the Minister for Finance and Administration seeking a reduction of DEST’s departmental item under Appropriation Act (No. 1) 2005-2006 by $10,115,000. These reductions relate to the unspent funds from the application of the Centrelink Funding Model.
Notes on the instrument
The instrument provides that the appropriation item in column 1 for the agency in column 2 is 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 Instrument Act 2003, DEST has been consulted in preparation of this instrument.