Loan Act 1993

Overview

The Loan Act 1993 was enacted by the Parliament of Australia to authorise the borrowing and spending of money for specific purposes, primarily to support defence services and supplement the Consolidated Revenue Fund. The Act was introduced to address the need for additional funding beyond what was available through existing appropriation Acts for the financial year ending on 30 June 1994. The primary policy objective of the Act is to enable the Treasurer to borrow money to meet the specified financial requirements for defence services and to supplement the Consolidated Revenue Fund, ensuring that necessary expenditures are met without exceeding authorised limits.

Scope and Application

The Loan Act 1993 applies to the borrowing and spending of money by the Treasurer for specific purposes within the Commonwealth of Australia. This Act authorises the Treasurer to borrow money to cover the expenses of defence services and to supplement the Consolidated Revenue Fund for the financial year ending on 30 June 1994. The borrowed funds must be used strictly for defence services and related borrowing expenses or for supplementing the Consolidated Revenue Fund and related borrowing expenses. This Act does not permit the spending of money beyond the limits set out in the relevant appropriation Acts, except for the payment of borrowing expenses after 30 June 1994. The borrowing must comply with the Commonwealth Inscribed Stock Act 1911, the Loans Securities Act 1919, or any Act authorising the issue of Treasury Bills. There are no explicit exclusions or exemptions in the Act, although spending is limited by reference to the relevant appropriation Acts.

Key Provisions

The Loan Act 1993 provides the framework for the borrowing and spending of money for specific purposes within the current financial year, as defined in section 3. Section 4(1) of the Act authorises the Treasurer to borrow money for defence services, ensuring that the total borrowed, including any previous borrowings during the financial year, does not exceed the authorised amount for defence services plus the expenses of borrowing. This money can only be borrowed in accordance with the Commonwealth Inscribed Stock Act 1911, the Loans Securities Act 1919, or an Act that authorises the issue of Treasury Bills (section 4(2)). The funds borrowed under this section must be used for defence services and the expenses of borrowing, as outlined in section 5. Similarly, section 6(1) allows the Treasurer to borrow money to supplement the Consolidated Revenue Fund, provided that the total borrowed does not exceed the shortfall in revenue and the expenses of borrowing. This money can be used for making payments to the credit of the Consolidated Revenue Fund and the expenses of borrowing, as specified in section 7. The Act imposes specific obligations and requirements on the Treasurer and other relevant parties. The Treasurer must ensure that the total amount borrowed for defence services does not exceed the authorised amount and must use the borrowed funds strictly for defence services and the expenses of borrowing (sections 4 and 5). Similarly, when borrowing to supplement the Consolidated Revenue Fund, the Treasurer must ensure that the total borrowed does not exceed the shortfall in revenue and the expenses of borrowing and must use the borrowed funds for the appropriate purposes (sections 6 and 7). Additionally, the Act mandates that the Loan Fund be appropriated to the necessary extent for the purposes of the Act (section 8). The Act also includes provisions that govern the limitations on expenditure. Section 9(1) stipulates that no amount can be spent on a defence service if the total expenditure for that service, including any spending under this Act and relevant appropriation Acts, exceeds the authorised amount for that service. However, this does not apply to spending under the heading "ADVANCE TO THE MINISTER FOR FINANCE" in relevant appropriation Acts (section 9(2)). Furthermore, the Act prohibits spending money after 30 June 1994, except for paying the expenses of borrowing (section 9(3)). Breach of these provisions could lead to civil or criminal consequences, although the specific penalties are not detailed in the text of the Act.