Explanatory Statement
Financial Management and Accountability Act 1997, Section 32 - Adjustments of Appropriations on Change of Agency Functions
The instrument to which this explanatory statement relates
This explanatory statement relates to an instrument (the instrument) entitled “Direction under Section 32, Financial Management and Accountability Act 1997”, dated 14 June 2005 and numbered 41 of 2004-2005.
The legislative authority under which the instrument is made
Section 32 of the Financial Management and Accountability Act 1997 (the FMA Act) applies if a function of an Agency (the old Agency) becomes a function of another Agency (the new Agency), either because the old Agency is abolished or for any other reason.
Subsection 32(2)(a) of the FMA Act enables the Finance Minister to, amongst other things, issue one or more directions to transfer from the old Agency to the new Agency some or all of an amount that has been appropriated for the performance of that function by the old Agency.
As noted in the FMA Act, the Finance Minister has delegated his power under section 32 to the Chief Executive of the Department of Finance and Administration. By way of an instrument dated 30 November 2004, the Chief Executive of the Department of Finance and Administration has, in turn, delegated the power to the Division Manager, Financial Reporting and Cash Management Division, Financial Management Group.
Purpose of the instrument
The instrument directs that appropriation totalling $25,000, provided to the Department of Employment and Workplace Relations in Appropriation Act (No. 1) 2004-05, be transferred to the Department of Family and Community Services.
Background
On 26 October 2004, the Governor-General issued an Administrative Arrangements Order, which was gazetted in Special Notices Gazette S427 of 27 October 2004, transferring responsibility for the Income support and programmes for people of working age, and to help people with disabilities obtain employment, other than supported employment, from the Department of Employment and Workplace Relations to the Department of Family and Community Services.
This section 32 agreement is for the transfer from the Department of Employment and Workplace Relations to the Department of Family and Community Services of the Volunteering Tasmania measure of $25,000 to the Volunteer Management Programme in Outcome 2 – Communities are Strong, Output 2.2 – Community Support. Appropriation adjustments, pursuant to section 32 of the FMA Act, are required to ensure that appropriation provided to the Department of Employment and Workplace Relations for performance of these functions is transferred, as agreed, to the Department of Family and Community Services.
Notes on the instrument
The instrument provides that the moneys listed in column 4 of the schedule for the Department of Employment and Workplace Relations item be transferred to the Department of Family and Community Services item listed in column 1.
Overview
The Financial Management and Accountability Act 1997 was enacted by the Parliament of Australia to address issues related to the management and accountability of public funds, particularly in cases where there are changes in agency functions. One specific provision within this Act, Section 32, deals with the adjustment of appropriations when a function of one agency is transferred to another agency, either due to the abolition of the original agency or for other reasons. This section aims to ensure that the financial resources allocated for specific functions are appropriately reallocated to the new agency responsible for those functions. The explanatory statement related to an instrument issued under Section 32 clarifies the process for transferring appropriations from the Department of Employment and Workplace Relations to the Department of Family and Community Services, following a change in administrative arrangements that was gazetted on 26 October 2004. The instrument directs the transfer of $25,000 to ensure continued funding for the Volunteering Tasmania measure within the Volunteer Management Programme, reflecting the policy objective of maintaining consistent service delivery despite changes in agency responsibilities.
Scope and Application
The Financial Management and Accountability Act 1997 governs the adjustment of appropriations when there is a change in agency functions, ensuring that funding follows the responsibilities of the relevant government entities. This Act applies to Commonwealth agencies when their functions are either abolished or transferred to another agency, necessitating a reassignment of appropriations to maintain fiscal integrity. The Act's application is limited to appropriations made by the Commonwealth and does not extend to state or territory appropriations. The Finance Minister, through delegated authority, can issue directions to effect these transfers, as seen in the Direction issued under Section 32 in 2005. This direction mandated the transfer of $25,000 from the Department of Employment and Workplace Relations to the Department of Family and Community Services due to a change in administrative arrangements. The instrument ensures that specific appropriations are reallocated to reflect the new functional responsibilities of the agencies involved.
Key Provisions
The main operative sections of this instrument are sections 32(2)(a) and 32(4) of the Financial Management and Accountability Act 1997 (FMA Act). Section 32(2)(a) allows the Finance Minister to issue directions to transfer appropriations from one agency to another when there is a change in the functions of those agencies. Section 32(4) specifies that such transfers are to be made in accordance with the directions issued by the appropriate authority, in this case the Chief Executive of the Department of Finance and Administration. These sections enable the transfer of $25,000 from the Department of Employment and Workplace Relations to the Department of Family and Community Services to support the Volunteering Tasmania measure.
The obligations and requirements imposed by this instrument are primarily administrative. The Chief Executive of the Department of Finance and Administration, having delegated authority from the Finance Minister, must ensure that the transfer of appropriations as specified in the instrument is carried out accurately and efficiently. The Department of Employment and Workplace Relations must comply with the directions by releasing the specified appropriation, and the Department of Family and Community Services must be prepared to receive and account for the transferred funds. Both departments must adhere to any further directions or guidelines provided by the relevant authorities to ensure the smooth transition of the specified funds.
There are no specific offences, penalties, or civil/criminal consequences mentioned in the explanatory statement for the breach of the provisions of this instrument. However, any failure to comply with the directions issued under section 32 of the FMA Act could potentially lead to legal consequences, including administrative penalties or legal action, depending on the nature and extent of the non-compliance. The precise consequences would be determined by the relevant authorities and could include financial penalties or corrective actions to ensure compliance with the Act’s requirements.