EXPLANATORY STATEMENT
Select Legislative Instrument 2006 No. 63
Subject - Financial Management and Accountability Act 1997
Financial Management and Accountability Amendment Regulations 2006 (No. 2)
Subsection 65(1) of the Financial Management and Accountability Act 1997 (the Act) provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.
The Act provides a framework of rules for the proper management of public money and public property that applies to Chief Executives and officials of Agencies.
Section 5 of the Act provides in part that, for the purposes of the Act, an “Agency” includes a prescribed Agency. Agencies are prescribed for the purposes of the Act in Schedule 1 to the Financial Management and Accountability Regulations 1997 (the Principal Regulations).
The purpose of the Regulations is to prescribe the Future Fund Management Agency under the Act.
The Future Fund Management Agency was established by section 74 of the Future Fund Act 2006.
The Future Fund Management Agency is financially autonomous from the Department of the Treasury under the Act for the proper management of public money and public property within its control or custody.
Further details of the Regulations are in the Attachment.
The Regulations are a legislative instrument for the purposes of the Legislative Instruments Act 2003.
The Regulations commenced on the day on which sections 3 to 85 of the Future Fund Act 2006 commenced.
In accordance with section 17 of the Legislative Instruments Act 2003, the Department of the Treasury was consulted in the preparation of the Regulations.
Authority: Subsection 65(1) of the Financial Management and Accountability Act 1997.
ATTACHMENT
Details of the Financial Management and Accountability Amendment Regulations 2006 (No. 2)
Regulation 1 - Name of Regulations
This regulation provides that the title of the Regulations is the Financial Management and Accountability Amendment Regulations 2006 (No. 2).
Regulation 2 - Commencement
This regulation provides for the Regulations to commence on the day on which sections 3 to 85 of the Future Fund Act 2006 commence.
Regulation 3 - Amendment of Financial Management and Accountability Regulations 1997
This regulation provides for the Financial Management and Accountability Regulations 1997 (the Principal Regulations) to be amended as set out in Schedule 1.
Schedule 1 – Amendment
Item [1] – Schedule 1, Part 1, after item 124A
Item 124AA is inserted to prescribe the Future Fund Management Agency. The Future Fund Management Agency comprises the Chair of the Future Fund Board of Guardians, staff engaged under the Public Service Act 1999, and consultants and persons seconded to the Agency.
The Regulations also insert a reference to Note B of Schedule 1 to the Principal Regulations. The reference indicates that the Future Fund Management Agency is also a Statutory Agency for the purposes of the Public Service Act 1999.
Overview
The Financial Management and Accountability Amendment Regulations 2006 (No. 2) were enacted to address the need for specific regulations governing the management of public money and public property by the Future Fund Management Agency. This agency was established under the Future Fund Act 2006 and operates autonomously from the Department of the Treasury. The Regulations were introduced to prescribe the Future Fund Management Agency under the Financial Management and Accountability Act 1997, ensuring that it adheres to the framework of rules for the proper management of public assets. The Regulations were prepared with consultation from the Department of the Treasury, as required by section 17 of the Legislative Instruments Act 2003. The overarching policy objective of these Regulations is to provide a clear regulatory environment for the Future Fund Management Agency, ensuring financial autonomy and accountability in its operations.
Scope and Application
The Financial Management and Accountability Amendment Regulations 2006 (No. 2) applies to the Future Fund Management Agency, which is prescribed under the Financial Management and Accountability Act 1997. This agency, established by the Future Fund Act 2006, is responsible for the proper management of public money and public property within its control or custody. The agency includes the Chair of the Future Fund Board of Guardians, staff engaged under the Public Service Act 1999, and consultants and persons seconded to the agency. The Regulations ensure that the agency is financially autonomous from the Department of the Treasury. The regulations commenced on the same day as sections 3 to 85 of the Future Fund Act 2006. The scope of the regulations extends to the Future Fund Management Agency and its staff, consultants, and seconded personnel, ensuring that the agency adheres to the proper management of public funds as outlined by the Financial Management and Accountability Act 1997.
Key Provisions
The Financial Management and Accountability Amendment Regulations 2006 (No. 2) amend the Financial Management and Accountability Regulations 1997 to prescribe the Future Fund Management Agency under the Financial Management and Accountability Act 1997. This is achieved by inserting a new item, 124AA, in Schedule 1 of the Principal Regulations (regulation 3). This new item specifies the Future Fund Management Agency, its Chair, staff, consultants, and seconded persons. The Regulations also clarify that the Agency is a Statutory Agency for the purposes of the Public Service Act 1999 by referencing Note B of Schedule 1 to the Principal Regulations.
These Regulations impose obligations on the Future Fund Management Agency to adhere to the framework of rules provided by the Financial Management and Accountability Act 1997 for the proper management of public money and public property. This includes ensuring that the Agency maintains appropriate financial management practices, reporting mechanisms, and accountability measures as stipulated by the Act. The Regulations mandate that the Agency operate with financial autonomy from the Department of the Treasury, ensuring that it manages its finances independently within the legal framework.
Failure to comply with the provisions of the Financial Management and Accountability Act 1997 or the Financial Management and Accountability Amendment Regulations 2006 (No. 2) may result in civil or criminal consequences. The Act provides for a range of penalties for breaches, including fines and imprisonment, depending on the nature and severity of the offence. The maximum penalties for offences under the Act are detailed in the Act itself and can vary widely based on the specific provision breached.
The Regulations were prepared in accordance with the Legislative Instruments Act 2003, with consultation from the Department of the Treasury as required by section 17 of that Act. The Regulations commenced on the same day as sections 3 to 85 of the Future Fund Act 2006, ensuring that the provisions of the Financial Management and Accountability Amendment Regulations 2006 (No. 2) are effective from the outset of the Future Fund Management Agency’s operations.