Financial Management and Accountability Determination 2008/01 - Special Accounts Abolition

Overview

The Financial Management and Accountability Act 1997 (FMA Act) was enacted to ensure sound financial management and accountability in the Commonwealth. This legislation provides a framework for financial management within the government and was introduced to address the need for effective oversight and control over public funds. Determination 2008/01, issued under section 20 of the FMA Act by the Minister for Finance and Deregulation, aims to abolish 10 Special Accounts that have become redundant due to structural changes within government agencies. The affected agencies, including the Australia-Japan Foundation, Australian Security Intelligence Organisation, and several classification boards, no longer require these Special Accounts as their functions have been integrated into other departments, and there is no future intention to use these accounts. The policy objective of this determination is to streamline financial management by eliminating unnecessary Special Accounts, thereby improving efficiency and reducing administrative burdens. The enacting body, in this case, is the Parliament, as Determination 2008/01 follows the legislative process outlined in the FMA Act, which mandates tabling and disallowance procedures for such determinations.

Scope and Application

The Financial Management and Accountability Act 1997 Determination 2008/01, issued under the authority of the Minister for Finance and Deregulation, pertains to the abolition of ten Special Accounts within specific Commonwealth agencies. These accounts were established to manage specific financial transactions and trust moneys for designated purposes. The affected entities include the Australia-Japan Foundation (A-JF), Australian Security Intelligence Organisation (ASIO), Classification Board (CB), Classification Review Board (CRB), and Office of Film and Literature Classification (OFLC). These Special Accounts, which previously held funds for services provided to other governments and non-agency bodies and for trust moneys on behalf of entities other than the Commonwealth, are being abolished because the entities themselves have been dissolved or their functions have been integrated into other departments. Specifically, the CB, CRB, and OFLC have been incorporated into the Attorney-General’s Department (AGD), the A-JF into the Department of Foreign Affairs and Trade (DFAT), and ASIO no longer requires these accounts as they have not been utilised in previous financial years. The geographic reach of this Determination is limited to the Commonwealth of Australia, and it does not require tabling in Parliament as per section 22 of the FMA Act. The instrument applies to the specified Special Accounts listed in Schedule 1, which are no longer necessary due to the restructuring of these agencies.

Key Provisions

The Determination 2008/01 under the Financial Management and Accountability Act 1997 (FMA Act) primarily concerns the abolition of ten Special Accounts (section 20). These accounts, which included the Other Trust Moneys Special Account and the Services for other Governments and Non-Agency Bodies Special Account, were previously used by the Classification Board (CB), Classification Review Board (CRB), Office of Film and Literature Classification (OFLC), Australia-Japan Foundation (A-JF), and the Australian Security Intelligence Organisation (ASIO) to temporarily hold moneys on trust or for services performed on behalf of other governments and non-agency bodies. The accounts have been deemed redundant due to changes in organisational structures and functions, leading to their abolition as detailed in Schedule 1 of the Determination. Under the FMA Act, Special Accounts are established by Determinations and are supported by appropriations, allowing specific purposes for spending from the Consolidated Revenue Fund (CRF) (section 20). The Finance Minister must table any establishing or varying Determination in each House of Parliament, with either House having the right to disallow the Determination within five sitting days (section 22). Determinations abolishing Special Accounts do not require tabling but follow the same disallowance provisions as outlined in Regulation 10 of the Legislative Instruments Regulations 2004. The affected parties—the Attorney-General’s Department (AGD), the Department of Foreign Affairs and Trade (DFAT), and ASIO—were consulted on the draft instrument and agree with its form. Since the instrument pertains to internal machinery of government purposes, no further consultation was deemed necessary (sections 17 and 18 of the Legislative Instruments Act 2003). The abolition of these Special Accounts is justified by the fact that the CB, CRB, and OFLC have been integrated into the AGD, while the A-JF has been absorbed by DFAT. Both the AGD and DFAT already manage equivalent accounts, rendering the relevant Special Accounts redundant. Additionally, ASIO has indicated it no longer requires its accounts as they have not been used in previous financial years and there is no intention to use them in the future. Any breaches of the provisions in the FMA Act can lead to civil or criminal penalties, depending on the nature and severity of the breach. For instance, misappropriating public funds or failing to comply with financial management requirements can result in fines or imprisonment, as stipulated in relevant sections of the FMA Act. The exact penalties for specific breaches would be determined by the courts based on the circumstances of each case.