Explanatory Statement
The instrument to which this explanatory statement relates
This explanatory statement relates to an instrument (the instrument) entitled “Determination to Reduce Appropriations Upon Request (No. 10 of 2007-2008) dated 24 June 2008.
The legislative authority under which the instrument is made
Subsection 12(2) of Appropriation Act (No. 4) 2003-2004 enables the Minister for Finance and Deregulation to make a Determination reducing an appropriation item of the kind of item listed in subsection 12(1) of Appropriation Act (No. 4) 2003-2004, in an Appropriation Act listed in subsection 12(1) of Appropriation Act (No. 4) 2003-2004, for an entity, by the amount specified in the Determination, upon receipt of a written request from the Minister responsible for that entity.
The provision was 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 program under Government policy is abolished prior to the appropriation being expensed.
In accordance with subsection 12(6) of Appropriation Act (No. 4) 2003-2004, a determination issued by the Finance Minister under subsection 12(2) cannot reduce an appropriation item by greater than the lesser of the amount requested by the responsible Minister, and the balance of the appropriation item remaining in the Consolidated Revenue Fund.
Purpose of the instrument
The instrument determines that the appropriation items for the entities listed in the Schedules are reduced by the amounts indicated in Column 5 of each provision.
Background
The Minister identified in Column 4 of each provision wrote to the Minister for Finance and Deregulation requesting a determination to reduce the departmental item appropriations for the entities listed in Column 1.
Notes on the instrument
The Schedules to the instrument list the entities to which a determination applies. The entities are listed alphabetically, by portfolio.
Each entity’s reduction determination table is contained within an individual provision. Each provision provides that the entity in column 1, has the appropriation item in column 2, under the legislative authority in column 3, through the request by the responsible Minister in Column 4, reduced, by the amount in column 5.
The instrument reflects entity and portfolio names contained in the appropriation Acts under which reductions are made, noting that these may have subsequently been changed by, for example, machinery of government changes
In accordance with the Legislative Instruments Act 2003, each entity identified in Column 1 of the instrument was consulted in the preparation of this instrument.
Disallowance
A Determination made under subsection 12(2) is a Legislative Instrument and is disallowable.
Overview
The "Determination to Reduce Appropriations Upon Request (No. 10 of 2007-2008)" was enacted on 24 June 2008, pursuant to subsection 12(2) of the Appropriation Act (No. 4) 2003-2004. The primary objective of this legislation was to address the issue of excess departmental appropriations that may arise due to various reasons, such as reclassification of funds, efficiency savings, or the abolition of a government program before its appropriation is expensed. The Minister for Finance and Deregulation has the authority to reduce such appropriation items upon receiving a written request from the relevant Minister responsible for the entity in question. The Act ensures that the reduction cannot exceed the lesser of the requested amount or the remaining balance in the Consolidated Revenue Fund, as stipulated in subsection 12(6) of the Appropriation Act (No. 4) 2003-2004. The instrument is disallowable under the Legislative Instruments Act 2003.
Scope and Application
This instrument, the "Determination to Reduce Appropriations Upon Request (No. 10 of 2007-2008) dated 24 June 2008," applies to specific entities within the Commonwealth jurisdiction of Australia, as identified in the Schedules of the instrument, which list the entities alphabetically by their respective portfolios. The reductions to appropriation items are made pursuant to subsection 12(2) of the Appropriation Act (No. 4) 2003-2004, at the request of the Minister responsible for each entity, and cannot exceed the lesser of the requested amount or the remaining balance of the appropriation item in the Consolidated Revenue Fund, as per subsection 12(6) of the Act. This legislative instrument is designed to address instances where excess appropriation may occur due to reclassifications, efficiency savings, or the abolition of government programs. Each entity listed in the Schedules has its appropriation item reduced by the specified amount, as detailed in Column 5 of each provision, reflecting the entity and portfolio names as contained in the relevant appropriation Acts, subject to subsequent changes such as machinery of government alterations.
Key Provisions
The main operative sections of the instrument (F2008L02321) revolve around subsection 12(2) of the Appropriation Act (No. 4) 2003-2004, which empowers the Minister for Finance and Deregulation to reduce an appropriation item of a specified kind listed in subsection 12(1) of the Act. This reduction can occur upon receiving a written request from the relevant Minister responsible for the entity in question. The instrument specifies the entities affected, the appropriation items to be reduced, and the exact amounts of the reductions, as detailed in the schedules accompanying the determination. The reductions are intended to address excess appropriation items that may arise due to various reasons, such as reclassification, efficiency savings, or program abolitions.
The Act imposes specific obligations and requirements on the parties involved. For the Minister for Finance and Deregulation, the key obligation is to review and process any written request from the relevant Minister for a reduction in appropriation items. The Act ensures that any reduction made cannot exceed the lesser of the amount requested by the responsible Minister and the balance of the appropriation item remaining in the Consolidated Revenue Fund, as stipulated in subsection 12(6) of the Appropriation Act (No. 4) 2003-2004. For the requesting Minister, the obligation is to provide a clear and documented request, specifying the entity and the appropriation item to be reduced. Additionally, each entity identified for a reduction must be consulted in the preparation of the instrument, as mandated by the Legislative Instruments Act 2003.
In terms of consequences for breach, the instrument, being a Legislative Instrument, is subject to disallowance. This means that Parliament has the authority to review and potentially reject the determination. While the instrument does not explicitly outline specific penalties for non-compliance with its provisions, the disallowance mechanism provides a significant deterrent. Furthermore, any misuse of the appropriation process or failure to adhere to the legislative requirements could potentially lead to broader scrutiny and accountability measures, though these are not detailed within the instrument itself. The primary focus is on ensuring the efficient and lawful management of government appropriations.