Direction under section 32, Financial Management and Accountability Act 1997 – Adjustments of Appropriations on Change of Agency Functions (No. 24 of 2004-2005)

Overview

The Financial Management and Accountability Act 1997 was enacted to ensure that financial management and accountability systems within the Commonwealth public sector are robust and meet the necessary standards for transparency and efficiency. This Act, passed by the Australian Parliament, aims to provide a framework for the financial management of Commonwealth entities, ensuring that public funds are managed prudently and responsibly. The legislation fills a critical gap by establishing clear guidelines and procedures for the allocation, use, and reporting of public funds, which are essential for maintaining public trust and confidence in government operations. In this context, the legislative instrument F2006B11677, issued under section 32 of the Financial Management and Accountability Act 1997, addresses the need for efficient financial transfers between government agencies. This particular instrument, issued by Anne Hazell, Division Manager of Financial Reporting and Cash Management Division within the Department of Finance and Administration on 24 December 2004, directs the transfer of specific appropriation funds from the Departmental Outputs of the Department of Employment and Workplace Relations to the Department of Human Services. The policy objective is to ensure that the funds are correctly allocated to the agencies that are best positioned to utilise them for their intended purposes, thereby enhancing the overall effectiveness of government spending and service delivery.

Scope and Application

The legislative instrument F2006B11677 issued under section 32 of the Financial Management and Accountability Act 1997 pertains to the transfer of funds between specific agencies within the Commonwealth. This instrument applies directly to the entities listed, which are government agencies, and the specified appropriation items for the financial year 2004-2005. The old agency, Department of Employment and Workplace Relations, is instructed to transfer the sum of $2,012,000 to the new agency, Department of Human Services. This direction is in line with the broader financial management objectives set forth by the Act, ensuring proper accountability and oversight of government funds. The instrument does not explicitly state any exclusions, exemptions, or thresholds, but it operates within the jurisdictional scope of the Commonwealth, impacting only the entities and appropriation items detailed in the schedule. Any further application or interpretation of this instrument may be clarified or extended through subordinate instruments or administrative guidelines.

Key Provisions

The key provisions of this legislative instrument (F2006B11677) are outlined in section 32 of the Financial Management and Accountability Act 1997, which empowers the specified officer to direct the transfer of moneys between agencies. In this case, the Division Manager of Financial Reporting and Cash Management Division, Department of Finance and Administration, has authorised the transfer of funds from one agency to another. Specifically, section 32 allows the transfer of appropriation funds from the Department of Employment and Workplace Relations to the Department of Human Services, as detailed in the attached schedule (section 1). The transfer involves an appropriation item from the Appropriation Act (No. 1) 2004-2005 for the sum of $2,012,000. This legislative instrument imposes several obligations and requirements on the parties involved. Firstly, the Division Manager, Anne Hazell, must ensure that the transfer of funds is executed in accordance with the direction provided. The 'old agency' (Department of Employment and Workplace Relations) must facilitate the transfer by releasing the specified funds to the 'new agency' (Department of Human Services). Both agencies are required to maintain accurate financial records and ensure that the transfer complies with relevant financial management policies and procedures. Additionally, any internal controls and reporting mechanisms must be adhered to in order to maintain accountability and transparency. There are potential consequences for breaches of the Financial Management and Accountability Act 1997. Any failure to comply with the direction given under section 32 could result in civil or criminal penalties. While specific offences and penalties are not detailed in the legislative instrument itself, the Act provides a framework for enforcing compliance. For instance, section 46 of the Act outlines the general penalties for breaches, which can include fines up to a maximum of 50 penalty units ($5,500 as of 2023) for individuals and 500 penalty units ($550,000 as of 2023) for bodies corporate, depending on the severity and nature of the breach. Furthermore, section 47 of the Act empowers the court to impose additional penalties, such as disqualification from managing corporations, to ensure compliance with financial management laws.