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 SOETM Special Account – FCA) Determination 2012/11
Purpose of the Determination
The Determination is made under subsection 20(1) of the Financial Management and Accountability Act 1997 (FMA Act) and establishes a Special Account entitled Services for Other Entities and Trust Moneys Special Account – Federal Court of Australia.
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 under subsection 20(1) of the FMA Act or vary Special Accounts under subsection 20(2) of the FMA Act are subject to the tabling and disallowance procedures in section 22 of the FMA Act. Section 22 of the FMA Act requires the Finance Minister to table a copy of the determination in each House of the Parliament. Either House may pass a resolution disallowing a determination within five sitting days of tabling. If the determination is not disallowed, it comes into effect on the day immediately after the last day on which it could have been disallowed.
Subsection 20(6) of the FMA Act exempts determinations that establish Special Accounts under subsection 20(1) of the FMA Act or vary Special Accounts under subsection 20(2) of the FMA Act from the operation of Part 6 (sunsetting) of the Legislative Instruments Act 2003.
Subsection 20(7) of the FMA Act exempts determinations that abolish Special Accounts under subsection 20(3) of the FMA Act from the operation of section 42 (disallowance) and Part 6 (sunsetting) of the Legislative Instruments Act 2003.
A Statement of Compatibility with Human Rights is not required for this legislative instrument. Subsection 9(1) of the Human Rights (Parliamentary Scrutiny) Act 2011 requires a Statement of Compatibility with Human Rights for all legislative instruments subject to disallowance under section 42 of the Legislative Instruments Act 2003. While legislative instruments made or varied under subsections 20(1) or 20(2) of the FMA Act are subject to disallowance under section 22 of the FMA Act they are not subject to disallowance under section 42 of the Legislative Instruments Act 2003. Legislative instruments made under subsection 20(3) of the FMA Act are exempt from disallowance under subsection 20(7) of the FMA Act, as such a Statement of Compatibility with Human Rights is not required.
Operation of this Determination
The Services for Other Entities and Trust Moneys Special Account – Federal Court of Australia (SOETM) combines the purposes of the Other Trust Moneys and the Services for Other Governments and Non-agency Bodies Special Accounts into a single standard purpose Special Account. The SOETM enables the Agency to continue to hold and expend amounts on behalf of persons or entities other than the Commonwealth. Typically the SOETM will be used to accommodate small amounts of miscellaneous moneys. For example, amounts 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.
Consultation
The Agency affected by this determination was given an opportunity to comment on the instrument.
As the instrument is for internal machinery of government purposes only, no consultation was necessary with other persons (see sections 17 and 18 of the Legislative Instruments Act 2003).
Overview
The Financial Management and Accountability (Establishment of SOETM Special Account – FCA) Determination 2012/11 was enacted under the Financial Management and Accountability Act 1997 (FMA Act) to address the need for a unified Special Account that would consolidate the purposes of previously separate accounts, namely the Other Trust Moneys and the Services for Other Governments and Non-agency Bodies Special Accounts, into a single entity. This determination was made under the authority of the Minister for Finance and Deregulation and is intended to streamline financial management processes by creating a more efficient mechanism for handling small amounts of miscellaneous moneys. The establishment of this Special Account ensures compliance with constitutional requirements that all Commonwealth revenues must be consolidated into the Consolidated Revenue Fund (CRF) and that spending is authorised by parliamentary appropriation. The policy objective of this determination is to facilitate better financial oversight and accountability by providing a dedicated account for handling trust and service-related transactions on behalf of entities other than the Commonwealth. The determination process adheres to the legislative requirements outlined in the FMA Act, including the tabling and disallowance procedures, ensuring that the creation of this Special Account is subject to parliamentary scrutiny.
Scope and Application
The Financial Management and Accountability (Establishment of SOETM Special Account – FCA) Determination 2012/11 applies to the Services for Other Entities and Trust Moneys Special Account – Federal Court of Australia, which consolidates the purposes of the Other Trust Moneys and the Services for Other Governments and Non-agency Bodies Special Accounts into one standard purpose Special Account. This Act allows the establishment of this account under the Financial Management and Accountability Act 1997, facilitating the holding and expenditure of funds on behalf of persons or entities other than the Commonwealth. Such entities might include other governments or non-agency bodies, typically for small amounts of miscellaneous moneys resulting from services rendered. The account operates under the purview of the Commonwealth, subject to the tabling and disallowance procedures outlined in the Financial Management and Accountability Act 1997, ensuring parliamentary oversight and control over its use. This Determination is exempt from certain disallowance and sunsetting provisions of the Legislative Instruments Act 2003, streamlining the process of establishing and managing Special Accounts within the government's financial framework.
Key Provisions
The main operative sections of this Determination (sections 2 and 3) establish a Special Account called the Services for Other Entities and Trust Moneys Special Account – Federal Court of Australia (SOETM). This account combines the purposes of the Other Trust Moneys and the Services for Other Governments and Non-agency Bodies Special Accounts into a single Special Account. The account enables the Agency to continue holding and expending amounts on behalf of entities other than the Commonwealth, such as other governments. This is particularly useful for accommodating small amounts of miscellaneous moneys received in connection with services performed for or on behalf of non-agency bodies (section 3(2)).
The Determination imposes obligations on the Agency to manage the SOETM in accordance with the purposes outlined. The account must be used for the specific purposes identified, which include holding and expending moneys on behalf of persons or entities other than the Commonwealth (section 3(1)). The agency must ensure that the funds in the SOETM are only used for the purposes specified in the Determination. This includes maintaining accurate records and ensuring that the expenditures align with the account’s designated use (section 3(3)).
There are no specific offences or penalties outlined in this Determination. However, any misuse or mismanagement of funds within the SOETM could potentially lead to administrative or financial repercussions under the Financial Management and Accountability Act 1997 (FMA Act). This might include actions taken by the responsible Minister or the Agency to rectify any breaches of the terms of the Determination. The FMA Act itself provides a framework for financial management and accountability, and any significant breaches could result in disciplinary actions or other consequences as per the relevant provisions of the Act (section 20).