EXPLANATORY STATEMENT
Issued by the authority of the Minister for Finance and Administration
Financial Management and Accountability Act 1997
Determination 2006/60 to establish a Special Account
Purposes of Determination 2006/60
The attached instrument makes a determination under subsection 20 (1) of the Financial Management and Accountability Act 1997 (FMA Act) to establish a Special Account entitled Other Trust Moneys - National Archives of Australia Special Account. It also specifies the nature of amounts that may be credited to, and the purposes for which amounts may be debited from, the Other Trust Moneys - National Archives of Australia Special 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 Special Account.
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 be abolished by a determination of the Finance Minister. However, there is no requirement to table such a determination.
Operation of the Determination 2006/60
Purpose of the Other Trust Moneys - National Archives of Australia Special Account
The determination is required in order to establish a Special Account, to enable the National Archives of Australia to temporarily hold amounts on behalf of persons or entities that are not subject to the FMA Act.
Other Trust Moneys Special Accounts provide agencies with an ability to hold amounts on behalf of others and the appropriation to expend these amounts. Typically Other Trust Moneys Special Accounts are used to accommodate small amounts of miscellaneous moneys. For example, the Other Trust Moneys Special Account may be used to provide an appropriation to allow moneys found by Commonwealth officials to be paid to their rightful owner once the owner has been identified. It may also be used to hold amounts received from Comcare in relation to employees entitled to receive workers’ compensation payments.
At the commencement of the FMA Act on 1 January 1998, a determination signed by the Minister for Finance and Administration created Other Trust Moneys Special Accounts for all agencies that existed at that time. The National Archives of Australia was created on 1 July 2000 and the agency has recently identified amounts that will be required to be held in an Other Trust Moneys Special Account.
Should the National Archives of Australia change its name, due to a change in legislation or for some other reason, it is intended that the Special Account be retained by the successor agency. This will enable the amounts in the Special Account at that time to remain with the relevant agency.
Clause 5 specifies the purposes for which a Special Account can be debited.
- Paragraph 5(a) describes the primary purpose for expenditure of amounts from the Special Account.
- Paragraph 5(b) allows the Special Account to be debited, in a manner that would otherwise be permitted by section 28 of the FMA Act. It is included to simplify accounting for these transactions.
Consultation
The National Archives of Australia is the agency affected by this instrument. The agency was provided with drafts of the instrument and agree 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).
Estimates of transactions on the Other Trust Moneys - National Archives of Australia Special Account
| Opening Balance 2007-08 2006-07 $’000 | Credits 2007-08 2006-07 $’000 | Debits 2007-08 2006-07 $’000 | Closing Balance 2007-08 2006-07 $’000 |
Other Trust Moneys - National Archives of Australia Special Account | 0 | 0 | 0 | 0 |
0 | 0 | 0 | 0 |
Overview
The Financial Management and Accountability Act 1997 was enacted to provide a framework for the financial management and accountability of the Commonwealth. The Act was introduced to address the need for a coherent and transparent system of financial management across the government, ensuring that all public funds are managed efficiently and effectively. Determination 2006/60 under this Act was made by the Minister for Finance and Administration to establish a Special Account, specifically the Other Trust Moneys - National Archives of Australia Special Account. This Special Account allows the National Archives of Australia to temporarily hold funds on behalf of entities not subject to the Act, facilitating the handling of miscellaneous moneys, such as those found by Commonwealth officials or received from Comcare for workers’ compensation payments. The establishment of this Special Account aims to provide a clear appropriation for the expenditure of these funds, ensuring they are managed in accordance with the overarching financial management principles outlined in the FMA Act. The creation of such accounts is subject to parliamentary oversight, with the Minister required to table the determination in each House of Parliament, allowing for potential disallowance within a specified period.
Scope and Application
The Determination 2006/60 under the Financial Management and Accountability Act 1997 establishes a Special Account titled the Other Trust Moneys - National Archives of Australia Special Account, which serves to facilitate the temporary holding of funds by the National Archives of Australia on behalf of individuals or entities not subject to the FMA Act. The establishment of this Special Account allows the agency to manage specific transactions and obligations that require a formal appropriation under the Act. The account is designed to accommodate small, miscellaneous amounts and is supported by an appropriation under section 20 of the FMA Act, with the details of credits and debits specified in Clause 5 of the Determination. This instrument applies solely to the National Archives of Australia and does not extend to other agencies or entities unless otherwise specified by a future determination. The Determination must be tabled in each House of Parliament and may be disallowed by either House within five sitting days of tabling, unless disallowed, it comes into effect on the calendar day after the disallowance period expires. The Special Account can be abolished by a determination of the Finance Minister, although such a determination need not be tabled.
Key Provisions
The Financial Management and Accountability Act 1997 (FMA Act) includes provisions for the establishment of Special Accounts, as detailed in Determination 2006/60. This particular determination establishes a Special Account called the Other Trust Moneys - National Archives of Australia Special Account, which is used to temporarily hold funds on behalf of persons or entities that are not subject to the FMA Act. The Special Account allows the National Archives of Australia to manage and disburse these funds in accordance with specific purposes, as outlined in the determination (sections 1-5). The Special Account is established under the authority granted by subsection 20(1) of the FMA Act, and it requires an appropriation to support its operations. This ensures that any spending from the account is within the parameters set by Parliament and that the funds are utilised for their intended purposes.
The obligations imposed by this Act on the National Archives of Australia include ensuring that the funds held in the Special Account are managed in accordance with the provisions of the FMA Act and the determination. This means that the agency must accurately record and report on the transactions involving the Special Account, ensuring that all credits and debits are properly authorised and documented. The agency must also ensure that any funds held in the account are ultimately returned to their rightful owners or used for the purposes specified in the determination (sections 20-22). Furthermore, the National Archives of Australia must maintain records and documentation to support the transactions and ensure compliance with the legislative requirements.
In terms of penalties and consequences for non-compliance, the FMA Act does not explicitly outline specific penalties for breaches related to the management of Special Accounts. However, breaches of the Act or determination may result in disciplinary action against individuals involved, as well as potential legal action for any financial losses incurred due to mismanagement or misuse of funds. Additionally, failure to comply with the reporting and documentation requirements may result in delays or complications in financial audits and reviews conducted by the relevant authorities (sections 20-22). It is essential that the National Archives of Australia adheres to the provisions of the FMA Act and the determination to avoid any negative consequences associated with non-compliance.