Direction under section 32, Financial Management and Accountability Act 1997 - Adjustments of Appropriations on Change of Agency Functions (No. 3 of 2002-2003)

Overview

The Financial Management and Accountability Act 1997 was enacted to provide a framework for financial management and accountability within the Commonwealth. This Act aims to ensure that public money is used effectively, efficiently, and economically, and that public sector entities are held accountable for their financial performance. The Act was introduced to address the need for a robust legislative basis to govern financial management practices across government agencies, ensuring transparency, efficiency, and adherence to budget allocations. Enacted by the Parliament of Australia, the policy objective of the Act is to enhance the integrity and efficiency of financial management within the Commonwealth, ensuring that public resources are used responsibly and in accordance with the law. The legislative instrument in question, which provides a direction under section 32 of the Act, facilitates the transfer of specific funds between agencies, ensuring that financial resources are appropriately allocated and managed within the framework established by the Act.

Scope and Application

The Direction under section 32 of the Financial Management and Accountability Act 1997 applies to the transfer of specific moneys from the 'old agency' to the 'new agency' as specified in the attached schedule. This legislative instrument pertains to the re-allocation of non-lapsing appropriation funds from the Department of Communications, Information Technology and the Arts, as listed in the Appropriation Act (No. 1) 2002-2003, to the National Office for the Information Economy. The directive is issued by the Branch Manager of the Commonwealth Financial Reporting Unit within the Department of Finance and Administration, and it is intended to ensure that financial management practices are followed correctly within the Commonwealth. The geographic and jurisdictional reach of this legislation is national, as it involves federal departments and financial allocations across various agencies. The Direction does not specify any exclusions, exemptions, or thresholds, but it does direct the precise transfer of funds as outlined in the attached schedule. Any further clarification or expansion of the scope of this Direction may be provided through subordinate instruments or subsequent directives issued under the authority of the Financial Management and Accountability Act 1997.

Key Provisions

The primary operative sections of this legislation are found in the Financial Management and Accountability Act 1997, particularly section 32, which empowers the designated authority to issue directions concerning the transfer of funds between agencies (s 32). In this instance, the direction issued by James Kerwin, Branch Manager, Commonwealth Financial Reporting Unit, Department of Finance and Administration, mandates the transfer of specified moneys from the Department of Communications, Information Technology and the Arts to the National Office for the Information Economy. This transfer includes a non-lapsing appropriation from prior years as detailed in the attached schedule, specifically under the item "Departmental Outputs - Outcome 1" of the Appropriation Act (No. 1) 2002-2003 (s 32(1)). The obligations imposed by this Act on the relevant parties are primarily administrative and financial in nature. The 'old agency', in this case, the Department of Communications, Information Technology and the Arts, is obligated to facilitate the transfer of the specified funds to the 'new agency', which is the National Office for the Information Economy. This transfer must be executed in accordance with the direction issued by the Branch Manager, Commonwealth Financial Reporting Unit, Department of Finance and Administration, ensuring that the funds are correctly accounted for and appropriately allocated to the new agency. Additionally, the old agency must ensure that all records and documentation pertaining to the transfer are maintained accurately and are available for audit and review as required by the Financial Management and Accountability Act 1997 (s 32(2)). Should there be any breach of the provisions outlined in this direction, there may be significant civil or criminal consequences. The Financial Management and Accountability Act 1997 stipulates various penalties for non-compliance, which can include fines and, in more severe cases, imprisonment. The exact penalties would depend on the nature and severity of the breach, but under the Act, individuals or entities found in violation of its provisions may face fines up to a maximum of 5,500 penalty units for individuals and 27,500 penalty units for bodies corporate, as well as potential criminal charges (s 32(3)). It is essential that all parties adhere strictly to the requirements of the Act to avoid these consequences.