Direction under section 32, Financial Management and Accountability Act 1997 - Adjustments of Appropriations on Change of Agency Functions (No. 12 of 2005-2006)

Overview

The Financial Management and Accountability Act 1997 (FMA Act) was enacted by the Parliament of Australia to address issues related to the management and accountability of public funds. Section 32 of the Act, concerning adjustments of appropriations on changes of agency functions, aims to facilitate the smooth transition of funds when a government agency's responsibilities are transferred to another agency. This provision ensures that budgetary allocations are appropriately reallocated to reflect the new organisational structure, thereby maintaining financial integrity and accountability. The enactment of this section was intended to mitigate financial disruptions and ensure that public resources are efficiently and effectively utilised in accordance with the government’s policy objectives. The authority to issue directions under this section has been delegated to the Chief Executive of the Department of Finance and Administration, who has further delegated this power to specific officials within the department.

Scope and Application

The "Direction under Section 32, Financial Management and Accountability Act 1997", dated 13 December 2005, pertains to the transfer of appropriations in the context of a change in agency functions. It applies to the Department of Family and Community Services and the Department of Employment and Workplace Relations, facilitating the transfer of $6,137,000 from the former to the latter, as necessitated by the administrative re-allocation of responsibilities concerning income support and disability services. The instrument is rooted in section 32 of the Financial Management and Accountability Act 1997, and is enacted through a series of delegations from the Finance Minister to the Chief Executive of the Department of Finance and Administration, and further to the General Manager, Financial Management Group, and the Division Manager, Financial Reporting and Cash Management Division. This legislative action ensures that financial allocations are appropriately adjusted in response to changes in agency functions, thereby maintaining fiscal integrity and continuity in service delivery as mandated by the FMA Act.

Key Provisions

The main operative sections of the instrument, titled "Direction under Section 32, Financial Management and Accountability Act 1997," pertain to the transfer of appropriations from one government department to another when there is a change in agency functions (section 32). This instrument specifically details the transfer of $6,137,000 from the Department of Family and Community Services to the Department of Employment and Workplace Relations due to a transfer of functions as outlined in an Administrative Arrangements Order issued by the Governor-General on 26 October 2004. This direction is necessary to ensure that the appropriations provided for specific functions are appropriately reallocated in accordance with the new departmental responsibilities. The obligations imposed by the Act on the parties involved include the necessity for the Finance Minister to issue directions for the transfer of appropriations when there is a change in agency functions (section 32(2)(a)). In this case, the Chief Executive of the Department of Finance and Administration has delegated this authority to the General Manager, Financial Management Group, and the Division Manager, Financial Reporting and Cash Management Division. The instrument requires these officials to ensure that the agreed amount of $6,137,000 is transferred from the Department of Family and Community Services to the Department of Employment and Workplace Relations. This transfer must be in line with established processes and agreements between the Chief Financial Officers of the respective departments. There are no explicit offences, penalties, or civil/criminal consequences mentioned within the text of the instrument itself. However, the instrument underscores the importance of adhering to the established processes and agreements for the transfer of appropriations. Failure to comply with the directions issued under section 32 of the Financial Management and Accountability Act 1997 could potentially lead to financial mismanagement or misallocation of funds, which may attract scrutiny or corrective action from oversight bodies. The exact nature of any penalties or consequences would depend on the specific circumstances and any additional regulatory frameworks in place.