Direction under section 32, Financial Management and Accountability Act 1997 - Adjustments of Appropriations on Change of Agency Functions (No. 21 of 2001-2002)

Overview

The Financial Management and Accountability Act 1997 was enacted to strengthen financial management and accountability within Australian government agencies. This Act was introduced to address the need for clear and transparent management of public funds, ensuring that appropriations are used effectively and efficiently. The policy objective of the Act is to provide a robust framework for the management of public money, enhancing the accountability of government agencies to the Parliament and the Australian public. The Act is administered by the Parliament of Australia and aims to ensure that public resources are used in a manner that is consistent with the intent of the appropriations made by Parliament. The legislative instrument in question, issued under section 32 of the Act, directs the transfer of specific appropriations from one government agency to another, ensuring that financial resources are allocated according to the approved budget and the intended outcomes of government programs.

Scope and Application

The legislative instrument F2007B00953, issued under the authority of the Financial Management and Accountability Act 1997, pertains specifically to the transfer of funds between government agencies. This direction is issued by James Kerwin, the Branch Manager of the Commonwealth Financial Reporting Unit within the Department of Finance and Administration. The Act applies to the entities named in the attached schedule, specifically detailing the transfer of appropriation items from the 'old agency' to the 'new agency'. The geographic and jurisdictional reach of this Act is within the Commonwealth of Australia, impacting the specified departments involved in the transfer process. There are no stated exclusions, exemptions, or thresholds detailed within this specific legislative instrument; however, the overarching Act may contain provisions that could affect the interpretation or application of this direction. The instrument does not extend or restrict application beyond the terms explicitly stated within the document itself, although it is noted that further directives or subordinate instruments may be issued under the authority of the Financial Management and Accountability Act 1997 to address related or subsequent financial transfers.

Key Provisions

The primary operative sections of this Direction under section 32 of the Financial Management and Accountability Act 1997 (FMA Act) are section 32 itself, which empowers the specified officer to direct the transfer of moneys between agencies, and the attached schedule, which lists the specific appropriation items, old and new agencies, and the amounts to be transferred. Section 32(1) of the FMA Act allows for the transfer of moneys between agencies to ensure efficient and effective financial management within the public sector. The attached schedule provides the detailed instructions for these transfers, specifying which appropriation items are to be moved from which 'old agency' to which 'new agency' and the exact amounts involved. The obligations imposed by this Direction are primarily on the 'old agency' and 'new agency' involved in the transfers. The 'old agency', such as the Department of Employment and Workplace Relations, is required to ensure that the specified moneys are accurately transferred to the 'new agency', in this case, the Department of Finance and Administration. The 'new agency' must then receive and account for these funds appropriately, ensuring they are used in accordance with the appropriation for which they were originally allocated. This Direction ensures that both agencies comply with the financial management requirements set out in the FMA Act by facilitating the necessary transfer of funds. Breaching the requirements of this Direction or failing to comply with the FMA Act can lead to significant consequences. Under section 36 of the FMA Act, any person who contravenes a direction issued under section 32 can be subject to both civil and criminal penalties. Civilly, the officer responsible for the breach may be liable for damages, and criminally, they could face fines of up to $21,000 for individuals and $105,000 for bodies corporate, as per section 37(2) of the FMA Act. These penalties underscore the importance of adhering to the Direction and the broader legislative framework governing financial management within Australian government agencies.