Explanatory Statement
Appropriation Act (No. 3) 2004-05, 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 2005 and is numbered 4 of 2004-05.
The legislative authority under which the instrument is made
Section 9 of Appropriation Act (No. 3) 2004-05 enables the Finance Minister to make a determination reducing departmental appropriations in 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 provision was first included in Appropriation Act (No. 3) 2003-04 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; or
- 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. 3) 2004-05 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 outputs appropriation provided to Tourism Australia in Appropriation Act (No. 3) 2004-05 be reduced by $121,000,000.
Background
On 16 May 2005, the Minister for Industry, Tourism and Resources, the Hon Ian McFarlane, MP, wrote to the Minister for Finance and Administration seeking a reduction of Tourism Australia’s departmental outputs appropriation in Appropriation Act (No. 3) 2004-05 by $121,000,000. Under the Tourism Australia (Repeal and Transitional Provisions) Act 2004, Tourism Australia obtained the rights to the Australian Tourist Commission’s 2004-2005 appropriation of $121,000,000. Tourism Australia was subsequently erroneously appropriated a further $121,000,000 in Appropriation Act (No. 3) 2004-2005.
Notes on the instrument
The instrument provides that the appropriation item in column 1 for Tourism Australia be reduced in response to a request made by the Minister in column 4 by the amount listed in column 6.