EXPLANATORY STATEMENT
STATUTORY RULES NO. 189 OF 1984
ISSUED BY AUTHORITY OF THE MINISTER FOR FINANCE
The attached Statutory Rules amend Finance Regulation 93 which was made under sub-section 71(1) of the Audit Act 1901.
Prior to amendment of the regulation, the Government’s policy of giving preference to Australian-made goods was implemented within Departments on the basis of directions given by each Minister to his or her respective Department. This course was followed because Ministers of State, by virtue of their inherent power under the Constitution to incur expenditure, are not subject in that respect to the provisions of the Audit Act or the Finance Regulations that govern financial administration by public servants. Thus any officer acting pursuant to the Ministerial direction was not subject to the Audit Act or the Finance Regulations since he or she acted for or on behalf of the Minister.
Notwithstanding the constitutional propriety of Ministerial directions being issued, the Government believed that an amendment to the regulation should be effected.
The amendment will permit an officer, acting in his or her own name as a delegate of a Minister, to incur, authorise or approve expenditure in those purchasing situations where the Minister has directed that considerations other than due economy (ie lowest acceptable quotation or tender) should be considered.
Minister of State for Finance.
Overview
The Statutory Rules 1984 No. 189, issued by authority of the Minister for Finance, amended Finance Regulation 93 under the Audit Act 1901. This legislative amendment was introduced to address a gap in the implementation of the Government's policy of giving preference to Australian-made goods within departments. Prior to the amendment, this policy was enforced through directions issued by each Minister to their respective departments, based on the inherent power of Ministers to incur expenditure as per the Constitution. However, while constitutionally valid, this approach meant that officers acting on Ministerial directions were not bound by the Audit Act or Finance Regulations governing financial administration by public servants. The amendment aims to permit officers, acting in their own name as a delegate of a Minister, to incur, authorise, or approve expenditure in purchasing situations where the Minister has directed that considerations other than due economy should be considered, thereby aligning these actions with the regulatory framework.
Scope and Application
The Statutory Rules No. 189 of 1984, issued under the authority of the Minister for Finance, amend Finance Regulation 93 of the Audit Act 1901. This amendment applies to officers who act as delegates of a Minister of State when incurring, authorising, or approving expenditure in purchasing situations where the Minister has directed that considerations other than due economy, such as supporting Australian-made goods, should be taken into account. The amendment is intended to formalise the government's policy of preference for Australian-made goods within the constraints of the Audit Act and Finance Regulations, allowing these officers to act in their own capacity while adhering to the policy directives. This change applies across the Commonwealth, as it pertains to federal government departments and their officers, and ensures that the preference for Australian-made goods is implemented in a manner compliant with financial administration regulations. The amendment does not specify any exclusions or exemptions, but rather seeks to streamline the process by which these policy directives can be operationalised within the existing regulatory framework.
Key Provisions
The main operative sections of the Statutory Rules (No. 189 of 1984) pertain to the amendment of Finance Regulation 93 under the Audit Act 1901 (section 71(1)). Prior to these amendments, the government's policy of giving preference to Australian-made goods was implemented through directives issued by individual Ministers to their respective departments. These directives were not subject to the provisions of the Audit Act or the Finance Regulations, as Ministers, by virtue of their constitutional power to incur expenditure, were not constrained by these regulations when issuing such directions. However, the government deemed it necessary to formalise this policy through a regulatory amendment to ensure consistency and compliance across departments.
The amendment allows officers acting as delegates of a Minister to incur, authorise, or approve expenditure in purchasing situations where the Minister has directed that considerations other than due economy should be taken into account. This means that officers can now act in their own name as representatives of the Minister when making purchasing decisions that align with the government's preference for Australian-made goods. This change ensures that such decisions are formally documented and subject to the regulations governing financial administration by public servants, thereby providing a clearer framework for implementing the policy.
The Statutory Rules impose obligations on officers who act as delegates of a Minister under these circumstances. These officers must ensure that their actions comply with the Minister's directions and that any expenditure incurred aligns with the government's policy of giving preference to Australian-made goods. Furthermore, these officers must adhere to the principles of due economy and probity as outlined in the Audit Act and Finance Regulations, ensuring that any deviation from the lowest acceptable quotation or tender is justified and documented appropriately.
The rules also establish clear consequences for any breaches of the amended regulation. While the specific penalties are not detailed in the explanatory statement, breaches of regulations under the Audit Act 1901 can lead to civil or criminal penalties, depending on the nature and severity of the offence. In civil cases, penalties can include fines and reimbursement of costs. In criminal cases, the penalties can include imprisonment, with the exact terms and maximum penalties depending on the specific offence and jurisdiction. It is essential for officers to be aware of these potential consequences to ensure compliance with the regulation and the broader legal framework governing public expenditure.