EXPLANATORY STATEMENT

Issued by the authority of the Minister for Finance and Administration

Financial Management and Accountability Act 1997

Determination 2007/20 to vary and abolish a Special Account

Purposes of Determination 2007/20  

The attached instrument makes a determination under section 20 of the Financial Management and Accountability Act 1997 (FMA Act) to vary and subsequently abolish the Industry Related Systems Development Special Account. This instrument varies the determination 2006/76 that was made  by the Minister for Finance and Administration under section 20 of the Financial Management and Accountability Act 1997 on 8 November 2006.

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 be abolished by a determination of the Finance Minister.  However, there is no requirement to table such a determination.

Operation of the Determination 2007/20  

Reasons for varying the Industry Related Systems Development Special Account

The Industry Related Systems Development Special Account currently enables the administration and management of amounts related to the development of Australian Customs Service systems for the import and export of cargo. This is commonly known as the Cargo Automation Development Fund.

The Minister for Justice and Customs has advised that the purposes of this Special Account should be varied in accordance with a settlement made between the Commonwealth Government and industry parties. The settlement requires the balance standing to the credit of this Special Account be deposited in an account established in accordance with a Funding Deed to be executed between the Commonwealth of Australia (Australian Customs Service) and the CADF Pty Ltd.

Changes required

The crediting clauses of the Industry Related Systems Development Special Account have been omitted from the determination and the purpose clauses have been replaced with a new single purpose clause in accordance with the above reasons.

Effect of this determination

The Industry Related Systems Development Special Account is being varied and abolished by this determination (Determination 2007/20) to prevent further amounts being credited to the Special Account.  Once the balance reaches zero, clause 4 of the determination will abolish the Industry Related Systems Development Special Account.

Consultation

The Australian Customs Service 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).

Estimates of transactions on the Industry Related Systems Development Special Account

*  As advised by the Australian Customs Service on 16 August 2007.