EXPLANATORY STATEMENT
Issued by the authority of the Minister for Finance
Public Governance, Performance and Accountability Act 2013
PGPA Act (Property Special Account 2014 - Establishment) Determination 04 (the Determination)
Purpose of the Determination
The Determination is made under subsection 78(1) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and establishes the Property Special Account 2014.
Special account determinations
In accordance with section 81 of the Constitution, all revenues or moneys raised or received by the Commonwealth Executive Government form one Consolidated Revenue Fund (CRF). Section 83 of the Constitution provides that such money may not be spent except under an appropriation made by law.
A special account established by a determination is an appropriation mechanism that sets aside amounts within the CRF for spending on the purposes specified in that determination. Such determinations are made by the Minister for Finance under section 78(1) of the PGPA Act. A special account determination sets out the types of amounts that may be credited to the special account and the purposes for which amounts may be debited from the account. Payments for the purposes of a special account that is established by a determination are supported by an appropriation contained in section 78(4) of the PGPA Act.
Subsection 79(2) of the PGPA Act provides that special account determinations are legislative instruments under the Legislative Instruments Act 2003. Subsection 79(4) of the PGPA Act provides that special account determinations are subject to disallowance by either House of the Parliament.
In accordance with subsection 79(3) of the PGPA Act, the Finance Minister must table a copy of such determinations in each House of the Parliament. Within five sitting days of tabling, either House may pass a resolution to disallow the determination. 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, or on a later day if specified in the determination.
Special account determinations are subject to Part 6 (sunsetting) of the Legislative Instruments Act 2003. A special account determination will, therefore, be repealed on the earlier of 1 April or 1 October falling on or after the tenth anniversary of registration of the determination.
Special account determinations may be varied or revoked by a subsequent determination being made in accordance with subsection 78(3) of the PGPA Act.
Human Rights
A Statement of Compatibility with Human Rights is not required for this determination. 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 determinations made or varied under subsections 78(1) or 78(3) of the PGPA Act are subject to disallowance under section 79 of the PGPA Act, they are not subject to disallowance under section 42 of the Legislative Instruments Act 2003. As such, a Statement of Compatibility with Human Rights is not required.
Operation of the Determination
The determination will restore in a new special account the provisions of the former Property Special Account (PSA), which was established by Financial Management and Accountability (Special Accounts) Determination 2000/15. The PSA was used for making payments related to the management of Commonwealth property (excluding Defence‑related property). The PSA unintentionally ceased on 17 October 2014 owing to an administrative error.
The determination would establish the Property Special Account 2014. Implementation of the determination would credit the special account with the amount of $345,120,610.79, which represents the closing balance of the former PSA. Crediting arrangements thereafter, and the purposes of the Property Special Account 2014, are the same as for the former PSA.
The Department of Finance is using its departmental appropriation to manage receipts and expenditure for Commonwealth property (excluding Defence-related property) between the repeal of the former PSA and the establishment of the new PSA. It is intended that the Department will be reimbursed for this amount of expenditure in a future Appropriation Bill. These mechanisms have been applied to ensure simplicity and transparency of record keeping relating to property-related activities; and to comply with the law and good practice in relation to the appropriation framework.
There is no net impact on the Government’s budget or financial position from this determination and related receipts, payments and appropriations.
Consultation
The Australian Government Solicitor, the Office of Parliamentary Counsel and the Department of Finance were consulted in the preparation of the determination. As the determination 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 Public Governance, Performance and Accountability Act 2013 (PGPA Act), enacted by the Parliament of Australia, aims to establish a framework for public sector accountability, performance, and governance. This legislation addresses the need for efficient and transparent financial management within the Commonwealth Executive Government. The PGPA Act (Property Special Account 2014 - Establishment) Determination 04, issued by the Minister for Finance, is a legislative instrument under the PGPA Act, establishing the Property Special Account 2014. The determination sets aside specific funds within the Consolidated Revenue Fund for the management of Commonwealth property, excluding Defence-related property, thereby ensuring compliance with appropriation laws and good practice in financial management. The establishment of this special account rectifies the unintentional cessation of the former Property Special Account in October 2014, restoring the account with its closing balance. The determination does not impact the government's budget or financial position and will sunset ten years after its registration unless varied or revoked earlier.
Scope and Application
The Public Governance, Performance and Accountability Act 2013 (PGPA Act) Property Special Account 2014 - Establishment Determination pertains to the establishment of the Property Special Account 2014, which is intended to resume the operations of the former Property Special Account (PSA) that unintentionally ceased due to an administrative error. The Determination applies to the Commonwealth Executive Government, specifically the Minister for Finance who is responsible for establishing this special account under the PGPA Act. The Property Special Account 2014 is a financial instrument used for managing payments related to the Commonwealth's property, excluding Defence-related property. It is designed to be an appropriation mechanism that sets aside amounts within the Consolidated Revenue Fund for specified purposes, in compliance with constitutional and legislative requirements. The Determination outlines the crediting and debiting procedures for the account, mirroring those of the former PSA, and ensures that payments are supported by an appropriation as stipulated in the PGPA Act. The Determination also addresses the interim period during which the Department of Finance managed property-related activities, with an intention to reimburse the Department through a future Appropriation Bill. This legislative instrument does not require a Statement of Compatibility with Human Rights as it is not subject to disallowance under the Legislative Instruments Act 2003. Furthermore, special account determinations like this are subject to disallowance by either House of the Parliament and must be tabled accordingly.
Key Provisions
The main operative sections of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) (Property Special Account 2014 - Establishment) Determination 04 (the Determination) are sections 78(1) and 78(4). Section 78(1) of the PGPA Act provides the authority for the Minister for Finance to make special account determinations, such as the establishment of the Property Special Account 2014, to set aside amounts within the Consolidated Revenue Fund for specific purposes. Section 78(4) then provides that payments for the purposes of a special account are supported by an appropriation contained in this section of the PGPA Act. These sections together establish the legal basis for the Property Special Account 2014, restoring the provisions of the former Property Special Account that had unintentionally ceased due to an administrative error.
The Determination imposes specific obligations on the parties it governs. It mandates that the Property Special Account 2014 be credited with the closing balance of the former Property Special Account, amounting to $345,120,610.79, to ensure continuity in property-related financial management. It also sets forth that the account's purposes and crediting arrangements remain consistent with those of the former account, which were used for managing Commonwealth property excluding Defence-related property. Additionally, the Department of Finance is responsible for managing interim receipts and expenditure until the account is officially established, with plans for reimbursement in a future Appropriation Bill. These obligations ensure that the account operates transparently and in compliance with the appropriation framework.
The Determination does not explicitly list offences or penalties for breaches; however, the broader legislative context under which it operates implies potential consequences. Under the Legislative Instruments Act 2003, special account determinations are legislative instruments subject to disallowance by either House of the Parliament. If a determination is disallowed, it ceases to have effect. Additionally, while specific penalties for non-compliance with the Determination are not detailed, general legal and financial repercussions may apply for improper use of public funds or failure to adhere to appropriation laws. These could include financial audits, legal scrutiny, and potential administrative or civil penalties as prescribed by relevant financial and administrative laws.
The legislative framework surrounding the Determination ensures that any deviations from its provisions could result in significant repercussions, including the potential disallowance of the Determination itself. This mechanism underscores the importance of adhering to the outlined procedures and obligations. Furthermore, any mismanagement or misappropriation of funds within the Property Special Account 2014 could lead to further legal and financial scrutiny, reinforcing the critical need for compliance with the Determination's stipulations.