Overview

The Determination to Reduce Appropriations Upon Request (No. 11 of 2011-2012) was enacted on 11 May 2012 under the authority of the Minister for Finance and Deregulation, as provided by Subsection 10(2) of the Appropriation Act (No. 1) 2009-2010 and 2010-2011. This instrument was introduced to address the need for reducing appropriations for the Department of Foreign Affairs and Trade (DFAT) for the financial years 2009-2010 and 2010-2011, following a request from the Minister for Foreign Affairs. The reductions were in accordance with government decisions related to DFAT's compliance with the Australian Government Foreign Exchange Risk Management Guidelines, whereby departmental funding is adjusted based on realised foreign exchange losses and gains on a "no win, no loss" basis. This legislative instrument allows for a decrease in appropriations without the need for additional parliamentary approval, streamlining the process of budget adjustments in response to financial management policies.

Scope and Application

The Determination to Reduce Appropriations Upon Request (No. 11 of 2011-2012) applies specifically to the Department of Foreign Affairs and Trade (DFAT) and the appropriations allocated to it under the Appropriation Act (No. 1) 2009-2010 and Appropriation Act (No. 1) 2010-2011. This instrument is enacted under the authority of the Appropriation Act and is applicable at the Commonwealth level, affecting the financial allocations within the federal government's budget. The determination was initiated by a written request from the Minister for Foreign Affairs to the Finance Minister, as authorised by subsection 10(2) of the respective Appropriation Acts, and serves to reduce DFAT's departmental item by specified amounts in response to foreign exchange risk management guidelines. Notably, the determination does not extend to other agencies or departments, nor does it affect any entities outside the Commonwealth jurisdiction. It specifically excludes any human rights considerations, as detailed in the Human Rights Impact Statement, affirming that the reduction of appropriations does not engage with the rights or freedoms outlined in the Human Rights (Parliamentary Scrutiny) Act 2011.

Key Provisions

The primary sections of the Determination to Reduce Appropriations Upon Request (No. 11 of 2011-2012) are Schedule 1 and Schedule 2, which detail the specific reductions to be made to the Department of Foreign Affairs and Trade (DFAT) appropriations for the financial years 2009-2010 and 2010-2011 respectively (Schedules 1 and 2). Section 10(2) of the Appropriation Act (No. 1) 2009-2010 and 2010-2011 enables the Finance Minister to reduce the departmental item for an agency by the specified amount in the Determination, upon receiving a written request from the Minister responsible for that agency. These determinations are legislative instruments and are subject to disallowance. The Act imposes several obligations and requirements on the parties it governs. The Finance Minister must respond to a written request from the Minister responsible for an agency by making a determination to reduce the departmental item for that agency, as specified in the request. The Minister for Foreign Affairs must submit a written request to the Finance Minister detailing the agreed-upon reductions to DFAT’s expenditure. These reductions are to be consistent with the Government’s decisions announced in the context of the 2011-12 Budget and must relate to DFAT’s compliance with the ‘Australian Government Foreign Exchange Risk Management Guidelines.’ Failure to comply with the requirements of the Act may result in civil or criminal consequences, although the Act itself does not explicitly outline specific penalties for breaches. However, under the Legislative Instruments Act 2003, any legislative instrument that fails to comply with legislative requirements may be subject to disallowance by Parliament. The maximum penalties for breaches of the Appropriation Act and other relevant legislation may apply, depending on the nature and severity of the breach. These penalties can include fines and imprisonment, as stipulated in the respective Acts.