EXPLANATORY STATEMENT
Issued by the authority of the Minister for Finance and Deregulation
Financial Management and Accountability Act 1997
Financial Management and Accountability (Establishment of Cultural Special Account) Determination 2011/18
Purpose of the Determination
The instrument is made under subsection 20 (1) of the Financial Management and Accountability Act 1997 (FMA Act) and establishes a Special Account entitled the Cultural 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 Cultural 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 this Determination
Reasons for establishing this Special Account
This Special Account is required to assist in managing amounts related to undertaking activities that may be approved by the Minister for the Arts, in relation to joint arrangements with one or more of the State and Territory governments.
Clause 6 of the Determination specifies the purposes for which the Special Account can be debited.
- Clause 6 (1) describes the purposes for expenditure of amounts from the Special Account.
- Clause 6 (2) 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; and
- incidental activities are specifically included in the purposes outlined in 6(1), to avoid any doubt about whether these activities are included within that subsection.
Consultation
The Department of the Prime Minister and Cabinet is the Agency affected by this determination and was provided with an opportunity to comment on a draft of this instrument and to supply data for the “Estimates of Transactions Table”. 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 balances and transactions
The table below outlines the estimated financial implication of the determination.
| ($’000) |
Opening Balance | Credits(1) | Debits(2) | Closing Balance |
Cultural Special Account | 2011-2012 | 0 | 489 | 489 | 0 |
|
Overview
The Financial Management and Accountability (Establishment of Cultural Special Account) Determination 2011/18 was enacted under the Financial Management and Accountability Act 1997 (FMA Act) by the authority of the Minister for Finance and Deregulation. This determination was created to establish a Cultural Special Account, which facilitates the management of funds for cultural activities approved by the Minister for the Arts in conjunction with state and territory governments. The purpose of this Special Account is to ensure that funds are appropriately allocated and utilised for the outlined cultural purposes, while maintaining the financial integrity of the Consolidated Revenue Fund (CRF) as required by the Constitution.
The establishment of the Cultural Special Account allows for specific amounts to be credited to and debited from the account, strictly for the purposes outlined in the determination. This includes activities that are incidental to the primary objectives of the account. The determination is subject to parliamentary disallowance under section 22 of the FMA Act, ensuring that there is oversight and transparency in the use of these funds. The Department of the Prime Minister and Cabinet, being the affected agency, was consulted during the drafting process, while no further consultation was deemed necessary as the instrument pertains to internal government mechanisms.
Scope and Application
The Financial Management and Accountability (Establishment of Cultural Special Account) Determination 2011/18 applies to the management of funds within a Special Account established under the Financial Management and Accountability Act 1997 (FMA Act). This Special Account, known as the Cultural Special Account, is designed to facilitate the management of funds related to activities approved by the Minister for the Arts, particularly those undertaken in conjunction with state and territory governments. The Act applies to the Commonwealth Government and involves transactions that fall within the specified purposes of the Special Account, which are detailed in Clause 6 of the Determination. The establishment of this Special Account is geographically limited to the national jurisdiction of Australia, encompassing federal government operations. The Determination does not extend to state or territory governments, which are involved only insofar as they participate in joint arrangements approved by the Minister for the Arts. Additionally, the Special Account is subject to parliamentary oversight, as outlined in section 22 of the FMA Act, which requires the Finance Minister to table the determination in each House of Parliament, with the possibility of disallowance within five sitting days. The Determination also specifies that the account can be abolished by a determination of the Finance Minister, although such a determination is not subject to parliamentary disallowance.
Key Provisions
The Financial Management and Accountability (Establishment of Cultural Special Account) Determination 2011/18 establishes a Cultural Special Account under subsection 20(1) of the Financial Management and Accountability Act 1997 (FMA Act). This Special Account is intended to manage funds related to activities approved by the Minister for the Arts, particularly those involving joint arrangements with state and territory governments. The determination specifies the types of credits and debits that can be made to and from the account. Section 6 of the determination outlines the purposes for which the account can be debited, including activities directly related to the approved cultural initiatives and incidental activities to ensure clarity and prevent ambiguity.
The obligations imposed by this Act on the parties governed by it primarily involve ensuring that the funds within the Cultural Special Account are used strictly for the purposes outlined in the determination. This includes maintaining accurate records of credits and debits, as well as adhering to the approved activities that the account supports. The Department of the Prime Minister and Cabinet, being the affected agency, must oversee the account's operations and ensure compliance with the stipulated purposes. Furthermore, the determination requires that the balance of the account not be set aside indefinitely, as outlined in clause 6(2), ensuring that funds are either utilised or reallocated as necessary.
Breach of the provisions outlined in the determination can result in various consequences. While the determination itself does not explicitly detail specific offences, penalties, or consequences for non-compliance, any misuse of funds from the Cultural Special Account could potentially lead to administrative or legal repercussions under the broader framework of the FMA Act. This may include audits, financial reporting requirements, or even potential legal action if the misuse is significant enough to warrant such measures. The determination's disallowance process, as outlined in section 22 of the FMA Act, provides a mechanism for parliamentary oversight, allowing either House to disallow the determination within five sitting days of tabling. However, the abolition of the account by the Finance Minister is not subject to this disallowance process.