EXPLANATORY STATEMENT
Issued by the authority of the Minister for Finance and Deregulation
Financial Management and Accountability Act 1997
Determination 2009/32 to establish a Special Account
Purposes of Determination 2009/32
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 Services for Other Entities and Trust Moneys – Organ and Tissue Authority 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 Services for Other Entities and Trust Moneys – Organ and Tissue Authority 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 may be 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 the purposes 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 the 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, such a determination is not subject to parliamentary disallowance.
Operation of Determination 2009/32
Reasons for establishing a new Special Account
Most agencies under the FMA Act administer either a Services for Other Entities and Trust Moneys (SOETM) Special Account or other Special Accounts that together encompass the purposes of a SOETM Special Account.
The SOETM Special Account will enable the Australian Organ and Tissue Authority to hold and expend amounts on behalf of persons or entities other than the Commonwealth.
Typically the SOETM Special Account will be used to accommodate small amounts of miscellaneous moneys. For example, the SOETM Special Account may be used to hold amounts (a) received in connection with services performed for or on behalf of any persons or entities that are not Agencies as prescribed under the FMA Act, such as other governments; and (b) received from Comcare in relation to employees entitled to receive workers’ compensation payments.
Clause 5 of the Determination specifies the purposes for which the Special Account can be debited.
- Subclauses 5 (a) and (b) describe the primary purposes for expenditure of amounts from the Special Account.
- Subclause 5 (c) allows the Special Account to the 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.
- Subclause 5 (d) allows the balance of the Special Account to be reduced without a real or notional payment occurring. It is included to ensure that these amounts are not set aside indefinitely.
Consultation
The Australian Organ and Tissue Authority 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 Services for Other Entities and Trust Moneys – Organ and Tissue Authority Special Account
| ($’000) |
Opening Balance | Credits | Debits | Closing Balance |
Services for Other Entities and Trust Moneys- Organ and Tissue Authority Special Account | 2009-10 | 0 | 0 | 0 | 0 |
2010-11 | 0 | 0 | 0 | 0 |
Overview
The Financial Management and Accountability Act 1997 (FMA Act) was enacted to ensure accountability in the financial management of Commonwealth agencies. The Act aims to provide a framework for the administration of financial resources, ensuring they are used efficiently and effectively. In this context, Determination 2009/32 was introduced by the Minister for Finance and Deregulation under the authority of the FMA Act to establish a Special Account, specifically the Services for Other Entities and Trust Moneys – Organ and Tissue Authority Special Account. This determination addresses the need for a dedicated account to manage small amounts of miscellaneous moneys, such as those received in connection with services performed for non-agency entities or from Comcare related to workers' compensation payments. The establishment of this Special Account is intended to streamline the financial management processes for the Australian Organ and Tissue Authority, ensuring compliance with the constitutional requirement that all government funds be part of the Consolidated Revenue Fund and only spent under parliamentary appropriation.
Scope and Application
The Determination 2009/32 under the Financial Management and Accountability Act 1997 establishes a Special Account for the Australian Organ and Tissue Authority, referred to as the Services for Other Entities and Trust Moneys – Organ and Tissue Authority Special Account. This Special Account is designed to facilitate the holding and expenditure of funds on behalf of entities other than the Commonwealth, including other governments and those receiving workers' compensation payments. The establishment of this Special Account ensures that such transactions are appropriately managed and recorded within the framework of the Consolidated Revenue Fund, as mandated by the Constitution. The Special Account determination is supported by an appropriation under section 20 of the FMA Act, which allows for the expenditure of funds from the CRF for specified purposes outlined in the determination. The establishment of this Special Account is subject to parliamentary disallowance, in accordance with section 22 of the FMA Act, while its abolition is not subject to such disallowance.
The Special Account allows the Australian Organ and Tissue Authority to credit and debit amounts for specific purposes, including holding funds received in connection with services for non-Commonwealth entities and facilitating payments to Comcare for workers’ compensation. The debiting of the Special Account is governed by clause 5 of the determination, which specifies the allowable purposes for expenditure, simplifying accounting and ensuring that the balance is managed effectively. The account is intended for small miscellaneous amounts and is subject to the oversight and approval processes outlined in the FMA Act, ensuring compliance with financial management standards. The Australian Organ and Tissue Authority was consulted in the drafting of this instrument, and no further consultation was deemed necessary as it pertains to internal government mechanisms.
Key Provisions
The main operative sections of this legislation pertain to the establishment of a Special Account under the Financial Management and Accountability Act 1997 (FMA Act) (s 20(1)). This determination establishes a Special Account titled "Services for Other Entities and Trust Moneys – Organ and Tissue Authority Special Account" and specifies the nature of amounts that may be credited to, and debited from, the account (s 5). According to the legislation, the Australian Organ and Tissue Authority is the agency responsible for managing this account and ensuring that it is used for its intended purposes (s 5). This Special Account is intended to hold and expend amounts on behalf of persons or entities other than the Commonwealth, such as other governments and employees entitled to workers’ compensation payments (s 5(a) and (b)). Additionally, the account may be debited in a manner that would otherwise be permitted by section 28 of the FMA Act, which is included to simplify accounting for these transactions (s 5(c)). The balance of the account may also be reduced without a real or notional payment occurring, ensuring that these amounts are not set aside indefinitely (s 5(d)).
The obligations and requirements imposed by this Act primarily focus on the management and administration of the Special Account by the Australian Organ and Tissue Authority. The agency is responsible for ensuring that the account is used strictly for its intended purposes, as outlined in the legislation (s 5). The agency must also ensure that all transactions within the account comply with the FMA Act and any other relevant legislation. Additionally, the agency must maintain accurate and up-to-date records of all transactions within the account, including opening and closing balances, credits, and debits (s 5). The agency is also required to provide regular reports to the relevant authorities, detailing the transactions within the account and any changes to its balance.
There are no specific offences, penalties, or civil/criminal consequences outlined in this legislation for breach of its provisions. However, any breaches of the FMA Act or other relevant legislation may result in legal action being taken against the responsible parties or entities. The maximum penalties for such breaches will depend on the specific offence and the severity of the breach. It is important for the Australian Organ and Tissue Authority to ensure that all transactions within the Special Account comply with the relevant legislation to avoid any potential legal consequences. Additionally, the agency must ensure that it maintains accurate and up-to-date records of all transactions within the account, as failure to do so may result in legal action being taken against the responsible parties or entities.