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. 14 of 2007-2008) dated 24 June 2008.
The legislative authority under which the instrument is made
Subsection 11(1) of Appropriation (Parliamentary Departments) Act (No. 1) 2005-2006 and Appropriation (Parliamentary Departments) Act (No. 1) 2007-2008 enables the Minister for Finance and Deregulation to make a Determination reducing a departmental item, an administered assets and liabilities item, or an other departmental item for an Agency, by the amount specified in the Determination, upon receipt of a written request from the responsible Presiding Officer.
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 11(4) of Appropriation (Parliamentary Departments) Act (No. 1) 2005-2006 and Appropriation (Parliamentary Departments) Act (No. 1) 2007-2008, a determination issued by the Finance Minister under subsection 11(1) cannot reduce an appropriation item by more than the lesser of the amount requested by the responsible Presiding Officer, 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 agencies listed in the Schedules are reduced by the amounts indicated in Column 5 of each provision.
Background
The Presiding Officer 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 agencies listed in Column 1.
Notes on the instrument
The Schedules to the instrument list the agencies to which a determination applies. The agencies are listed alphabetically, by portfolio.
Each agency’s reduction determination table is contained within an individual provision. Each provision provides that the agency in column 1, has the appropriation item in column 2, under the legislative authority in column 3, through the request by the Presiding Officer in Column 4, reduced, by the amount in column 5.
The instrument reflects agency 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 agency identified in Column 1 of the instrument was consulted in the preparation of this instrument.
Disallowance
Subsection 11(8) of the Appropriation Acts that this determination is made under provides that a determination made under subsection 11(1) is a legislative instrument and despite subsection 44(2) of the Legislative Instruments Act 2003, (which provides that Instruments made under Annual Appropriation Acts are not subject to disallowance under section 42 of the Legislative Instruments Act 2003) section 42 of that Act applies to this Determination
Overview
The instrument, “Determination to Reduce Appropriations Upon Request (No. 14 of 2007-2008) dated 24 June 2008, was enacted to facilitate the reduction of appropriations for various agencies as requested by their respective Presiding Officers. This instrument is underpinned by the legislative authority provided under subsection 11(1) of the Appropriation (Parliamentary Departments) Act (No. 1) 2005-2006 and Appropriation (Parliamentary Departments) Act (No. 1) 2007-2008, which empowers the Minister for Finance and Deregulation to decrease specified appropriation items upon receiving a written request from the responsible Presiding Officer. The primary objective of this legislative measure is to address instances of excess appropriation, which can occur due to various reasons such as reclassification of funds, efficiency savings, or the abolition of a government program before the appropriation is expensed. The instrument ensures that any reduction does not exceed the lesser of the amount requested by the Presiding Officer or the balance of the appropriation item remaining in the Consolidated Revenue Fund.
Scope and Application
The Determination to Reduce Appropriations Upon Request (No. 14 of 2007-2008) applies to specified agencies whose appropriation items are subject to reduction as per the request of the relevant Presiding Officer. The instrument encompasses agencies that have excess appropriations due to various reasons such as reclassification, efficiency savings, or program abolitions, and it operates under the legislative authority provided by the Appropriation (Parliamentary Departments) Acts (No. 1) 2005-2006 and 2007-2008. The geographic and jurisdictional reach of this instrument is confined to the Commonwealth level, specifically affecting agencies within the Australian government. The reduction cannot exceed the lesser of the requested amount by the Presiding Officer or the balance remaining in the Consolidated Revenue Fund. Each agency listed in the schedules has been individually consulted in the preparation of this instrument, ensuring compliance and accuracy. Despite being an instrument under the Annual Appropriation Acts, it is subject to disallowance under section 42 of the Legislative Instruments Act 2003.
Key Provisions
The key provisions of the Determination to Reduce Appropriations Upon Request (No. 14 of 2007-2008) are found in sections 11(1), 11(4), and 11(8) of the Appropriation (Parliamentary Departments) Act (No. 1) 2005-2006 and Appropriation (Parliamentary Departments) Act (No. 1) 2007-2008. Section 11(1) enables the Minister for Finance and Deregulation to reduce a departmental item, an administered assets and liabilities item, or an other departmental item for an agency, by the amount specified in the Determination, upon receipt of a written request from the responsible Presiding Officer. This reduction is capped by the lesser of the amount requested or the balance of the appropriation item remaining in the Consolidated Revenue Fund, as stipulated in section 11(4). The determination is considered a legislative instrument and is subject to disallowance under section 42 of the Legislative Instruments Act 2003, despite the general exemption for instruments made under Annual Appropriation Acts provided in section 44(2) of the same Act (section 11(8)).
The Act imposes several obligations on the parties it governs. The Minister for Finance and Deregulation must respond to a written request from the responsible Presiding Officer to reduce departmental appropriation items, provided the reduction does not exceed the requested amount or the remaining balance in the Consolidated Revenue Fund. The Presiding Officers must submit a formal request to the Minister for any reductions required, ensuring that the reductions are justified and within the permissible limits. Additionally, the agencies listed in the Schedules to the instrument must cooperate with the process, including providing accurate information and ensuring that the reductions are correctly implemented within their budgets.
Failure to comply with the provisions of the Act may result in legal consequences. Under the Legislative Instruments Act 2003, the determination can be subject to disallowance, which means it can be reviewed and potentially invalidated by Parliament. While specific offences and penalties are not detailed in the Explanatory Statement, breaches of appropriation laws can generally lead to financial mismanagement charges, which may carry significant penalties. The precise penalties would depend on the nature and severity of the breach, but they could include fines or other legal repercussions.
In summary, the Determination to Reduce Appropriations Upon Request (No. 14 of 2007-2008) provides a framework for reducing excess appropriation items in accordance with specific legislative authorities and limits. It mandates that the Minister for Finance and Deregulation act on requests from Presiding Officers, while ensuring the reductions are within permissible bounds. Non-compliance with the Act can result in disallowance and potential financial or legal penalties. The Act reflects a structured approach to managing departmental budgets and ensuring fiscal responsibility within the government’s appropriation framework.