EXPLANATORY STATEMENT
Issued by the authority of the Minister for Finance and Administration
Financial Management and Accountability Act 1997
Determination 2006/08 to abolish a Special Account
Purposes of Determination 2006/08
The attached instrument makes a determination under subsection 20(3) of the Financial Management and Accountability Act 1997 (FMA Act) to abolish the Regional Telecommunications Infrastructure Account.
Special Accounts generally
In accordance with the Constitution, all revenues or moneys raised or received by the Government of the Commonwealth form one Consolidated Revenue Fund (CRF) and may not be spent unless under an appropriation by the Parliament for the purposes of the Commonwealth. A Special Account is established by a determination that sets out the amounts that may be credited and the purposes for which it may be debited. Special Accounts established by determination are supported by an appropriation under section 20 of the FMA Act. In effect, Special Accounts allow amounts from the CRF to be spent on a purpose specified in the determination.
Determinations that establish Special Accounts, or vary determinations that establish Special Accounts, are subject to section 22 of the FMA Act. Section 22 of the FMA Act requires the Finance Minister to table a copy of the establishing or varying determination in each House of Parliament. Either House may disallow a determination within five sitting days of tabling. If the determination is not disallowed, it comes into effect on the calendar day after the last day on which it could have been disallowed.
Regulation 10 of the Legislative Instruments Regulations 2004 preserves the disallowance provisions under section 22 of the FMA Act by exempting Special Account determinations from subsections 57(2) and 57(5) of the Legislative Instruments Act 2003.
Special Accounts can also be abolished by a determination of the Finance Minister. However, there is no requirement to table the determination to abolish a Special Account.
Operation of Determination 2006/08
This Determination abolishes the Regional Telecommunications Infrastructure Account, with effect from the date of registration on the Federal Register of Legislative Instruments.
Reasons for abolishing the Special Account
All expenditure under the programmes that were conducted under the Regional Telecommunications Infrastructure Account concluded on 30 June 2004. Consequently, the agency managing the Special Account has requested that it be abolished.
Consultation
The Department of Communications, Information Technology and the Arts is the agency affected by this instrument. The agency was provided with drafts of the instrument and agrees with the form of the instrument. As the instrument is for internal machinery of government purposes only, no consultation was considered necessary with other persons (see sections 17 and 18 of the Legislative Instruments Act 2003).
Overview
The Financial Management and Accountability Act 1997 (FMA Act) was enacted to provide a framework for the financial management and accountability of Commonwealth entities, ensuring that funds are properly authorised, allocated, and utilised. The Act addresses the need for clear and effective governance of public finances, aligning with the constitutional requirement that all government revenues form one Consolidated Revenue Fund and may only be spent under parliamentary appropriation. Determination 2006/08, issued under the authority of the Minister for Finance and Administration, seeks to abolish the Regional Telecommunications Infrastructure Account, a Special Account established to manage specific expenditures related to regional telecommunications infrastructure. The policy objective is to streamline financial management processes by removing accounts that are no longer operational, thereby enhancing efficiency and accountability. This determination was enacted without the need for disallowance as all related expenditure programmes concluded, and the relevant agency, the Department of Communications, Information Technology and the Arts, supports the abolition.
Scope and Application
The Financial Management and Accountability Act 1997 Determination 2006/08 pertains to the abolition of the Regional Telecommunications Infrastructure Account, a Special Account established under the FMA Act to manage specific funds within the Consolidated Revenue Fund. This legislation applies directly to the Finance Minister, who has the authority to make determinations establishing or abolishing Special Accounts, as well as to the agency managing the account, in this case, the Department of Communications, Information Technology and the Arts. The abolition of the Regional Telecommunications Infrastructure Account was enacted due to the conclusion of all expenditure under the programmes it managed by 30 June 2004. The determination comes into effect upon registration on the Federal Register of Legislative Instruments and does not require disallowance procedures, as it is not subject to disallowance by either House of Parliament. The instrument was drafted with the agreement of the affected agency, and no further consultation was deemed necessary as it pertains to internal machinery of government purposes.
Key Provisions
The key provision of Determination 2006/08 is the abolition of the Regional Telecommunications Infrastructure Account (section 20(3) of the Financial Management and Accountability Act 1997 (FMA Act)). This determination specifies that the Regional Telecommunications Infrastructure Account is to be abolished as of the date of registration on the Federal Register of Legislative Instruments. The Special Account, which was established to manage funds for regional telecommunications infrastructure, is no longer required since all related expenditure programs concluded on 30 June 2004. The determination outlines the legal process for abolishing a Special Account, which involves the Finance Minister issuing a determination that takes effect upon registration, without the need for parliamentary disallowance.
The obligations imposed by the FMA Act on the parties involved primarily concern the establishment, maintenance, and abolition of Special Accounts. Section 20 of the FMA Act mandates that any determination to establish or vary a Special Account must be tabled in each House of Parliament by the Finance Minister, allowing for a disallowance period of five sitting days. This process ensures transparency and accountability in the management of government funds. Section 22 of the FMA Act also provides for disallowance, though in this case, the abolition of the Regional Telecommunications Infrastructure Account does not require tabling due to Regulation 10 of the Legislative Instruments Regulations 2004. This regulation exempts Special Account abolition determinations from certain disallowance provisions in the Legislative Instruments Act 2003.
Breaching the provisions of the FMA Act or the associated regulations can lead to significant consequences. Section 20 of the FMA Act includes civil and criminal penalties for unauthorised expenditure from the Consolidated Revenue Fund or misuse of funds. While the abolition of the Regional Telecommunications Infrastructure Account does not directly introduce new offences, it removes a specific avenue for fund allocation. Non-compliance with the act's requirements could result in legal action against the responsible parties, with penalties potentially including fines and imprisonment. The exact penalties would depend on the specific breach and the relevant sections of the FMA Act or other applicable legislation.