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2010-2011-2012-2013
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
APPROPRIATION BILL (NO. 3) 2012-2013
EXPLANATORY MEMORANDUM
(Circulated by the authority of the Minister for Finance and Deregulation,
Senator the Honourable Penny Wong)
Table of Acronyms and Defined Terms
Act No. 1 Appropriation Act (No. 1) 2012-2013
AEs Additional Estimates
AFM Advance to the Finance Minister
AI Act Acts Interpretation Act 1901
CAC Act Commonwealth Authorities and Companies Act 1997
CRF Consolidated Revenue Fund
FMA Act Financial Management and Accountability Act 1997
FMA Regulations Financial Management and Accountability
Regulations 1997
GST Goods and Services Tax
LI Act Legislative Instruments Act 2003
PAES Portfolio Additional Estimates Statements
PBS Portfolio Budget Statements
PSES Portfolio Supplementary Estimates Statements
House of Representatives page 1 Appropriation Bill (No. 3) 2012-2013
Outline
Appropriation Bill (No. 3) 2012-2013
General Outline
1 This Explanatory Memorandum accompanies Appropriation Bill (No. 3)
2012-2013 (the Bill).
2 The main purpose of the Bill is to propose appropriations from the
Consolidated Revenue Fund (CRF) for the ordinary annual services of the
Government in addition to those provided in the 2012-2013 Budget.
3 Appropriations for the ordinary annual services of the Government must
be contained in a separate bill from other appropriations in accordance with
sections 53 and 54 of the Australian Constitution. Other annual appropriations
that are not for the ordinary annual services of the Government are proposed in
Appropriation Bill (No. 4) 2012-2013. Together the Bill and Appropriation Bill
(No. 4) 2012-2013 are termed the Additional Estimates (AEs) Appropriation
Bills.
4 This Explanatory Memorandum should be read in conjunction with the
various 2012-2013 Portfolio Statements, in particular:
(a) the Portfolio Additional Estimates Statements (PAES) which contain
details of the appropriations set out in Schedule 1 of the Bill and are
published and tabled in the Parliament in relation to the Bill;
(b) the Portfolio Supplementary Estimates Statements (PSES) that were
published and tabled in the Parliament in relation to Appropriation
(Implementation of the Report of the Expert Panel on Asylum Seekers)
Bill (No. 1) 2012-2013 and Appropriation (Implementation of the Report
of the Expert Panel on Asylum Seekers) Bill (No. 2) 2012-2013; and
(c) the Portfolio Budget Statements (PBS) that were published and tabled in
the Parliament in relation to Appropriation Bill (No. 1) 2012-2013 and
Appropriation Bill (No. 2) 2012-2013.
Structure of appropriations in the Bill
5 The Bill provides for the appropriation of specified amounts for
expenditure by Australian Government agencies (primarily being agencies
under the Financial Management and Accountability Act 1997 (FMA Act)
plus payments to bodies under the Commonwealth Authorities and Companies
Act 1997 (CAC Act).
House of Representatives page 2 Appropriation Bill (No. 3) 2012-2013
Outline
6 Part 1 of the Bill deals with definitions, the interpretative role of the
Portfolio Statements and the concept of notional payments.
7 Part 2 of the Bill proposes appropriations to make payments of the
amounts in Schedule 1 for departmental items (clause 7), administered items
(clause 8) and CAC Act body payment items (clause 9).
8 Part 3 of the Bill specifies the ways in which the amounts in Schedule 1
may be adjusted.
9 Part 4 deals with credits to Special Accounts (clause 14) and provides
for amounts to be appropriated as necessary (clause 15). In addition to the
adjustment provisions in Part 3, clause 15 of the Bill recognises that the
appropriations in the Bill may also be varied by the FMA Act.
Financial Impact
10 The Bill will appropriate the amounts specified in Schedule 1.
House of Representatives page 3 Appropriation Bill (No. 3) 2012-2013
Statement of compatibility with human rights
Statement of compatibility with human rights
1 The Bill seeks to appropriate money for the ordinary annual services of
the Government.
2 The Bill does not engage any of the applicable rights or freedoms
outlined in the Human Rights (Parliamentary Scrutiny) Act 2011.
3 The Bill is compatible with the human rights and freedoms recognised
or declared in the international instruments listed in section 3 of the Human
Rights (Parliamentary Scrutiny) Act 2011 as it does not raise any human rights
issues.
House of Representatives page 4 Appropriation Bill (No. 3) 2012-2013
Notes on clauses
Notes on clauses
Part 1--Preliminary
Clause 1--Short title
1 This clause specifies that the short title of the Bill, once enacted, will be
Appropriation Act (No. 3) 2012-2013.
Clause 2--Commencement
2 Clause 2 provides for the Bill to commence as an Act on the day of the
Royal Assent.
Clause 3--Definitions
3 Clause 3 defines the key terms used in the Bill, such as "administered
item", "Agency", "CAC Act body payment item", "current year" and
"departmental item".
Clause 4--Portfolio Statements
4 Clause 4 declares that the Portfolio Statements (PBS, PSES and PAES)
are extrinsic material under paragraph 15AB(2)(g) of the Acts Interpretation
Act 1901 (AI Act) that may be used to ascertain the meaning of certain
provisions in accordance with subsection 15AB(1) of the AI Act. The purpose
of the Portfolio Statements is to provide information on the proposed allocation
of resources to Government outcomes by agencies within each portfolio. The
Portfolio Statements provide information to enable Parliament to understand the
purpose of appropriations proposed in the Bill. The term "Portfolio Statements"
is defined in clause 3, to mean the PBS, PSES and PAES.
Clause 5--Notional payments, receipts etc.
5 Clause 5 ensures that payments between agencies result in a debit from
the appropriation for the paying agency. For example, the payments of the
amounts in Schedule 1 from one FMA Act agency to another do not require, in
a constitutional sense, an appropriation, because both agencies operate within
the CRF. However, for reasons of financial discipline and transparency, the
practice has arisen for these payments between agencies to be treated as though
they required an appropriation, and to debit an appropriation when such
notional payments are made.
House of Representatives page 5 Appropriation Bill (No. 3) 2012-2013
Notes on clauses
6 Clause 5 provides that notional transactions between agencies are to be
treated as if they were real transactions. Notional transactions, therefore, require
the use of a drawing right and the debiting of an appropriation made by
Parliament. When an FMA Act agency makes a payment, whether to another
FMA Act agency or another part of the same agency (such as a different
"business unit" within the agency), it is to be treated as a "real" payment. This
means that the appropriation made by Parliament is extinguished by the amount
of the notional payment, even though no payment is actually made from the
CRF. Similarly, a notional receipt in such a situation is to be treated by the
receiving agency (where relevant) as if it were a real receipt. This does not
mean every internal transfer of public money involves a notional payment and
receipt. As explained in regulation 19 of the Financial Management and
Accountability Regulations 1997 (FMA Regulations), some transfers of public
money from one official account to another do not involve a notional payment
or debiting an appropriation.
Part 2--Appropriation items
Clause 6--Summary of appropriations
7 Clause 6 sets out the total of the appropriations in Schedule 1 of the Bill.
Importantly, the amounts in Schedule 1 may be adjusted under the provisions in
Part 3 of the Bill. In particular:
Departmental items may be reduced in accordance with clause 10;
Administered items may be reduced in accordance with clause 11;
CAC Act body payment items may be reduced in accordance with
clause 12; and
items may be increased by a determination under clause 13 (Advance to
the Finance Minister).
8 The amounts in Schedule 1 of the Bill may be adjusted further in
accordance with sections 30, 30A, 31 and 32 of the FMA Act. Specifically:
Section 30 allows an agency to re-credit, to an appropriation that had been
relied upon for an initial payment by the agency, an amount equivalent to
the repayment. The re-crediting, or reinstatement, authorised by
section 30, can result in the total amount paid from the CRF in gross
terms, exceeding the amount specified in an item. Section 30 also applies
to notional transactions between and within agencies.
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Notes on clauses
Appropriations may be adjusted by amounts recovered by an agency from
the Australian Taxation Office for Goods and Services Tax (GST),
in accordance with section 30A of the FMA Act. The amounts specified
in Schedule 1 exclude recoverable GST. The appropriations shown
represent the net amount that Parliament is asked to allocate to particular
purposes. Section 30A has the effect of increasing an appropriation by the
amount of the GST qualifying amount arising from payments in respect of
the appropriation. As a result, there is sufficient appropriation for
payments under an appropriation item, provided that the amount of those
payments, less the amount of recoverable GST, can be met from the
initial amount shown against the item in Schedule 1. Section 30A also
applies to notional transactions between and within agencies.
Departmental items may be increased to take into account certain other
amounts received by an agency, if those receipts are prescribed by the
FMA Regulations, in accordance with section 31 of the FMA Act. For
example, FMA regulation 15 prescribes amounts that offset costs in
relation to the activities of an agency and amounts that relate to an
employee's leave (including amounts received under the paid parental
leave scheme that was established on 1 January 2011). FMA
regulation 15 also establishes a mechanism for agencies to hold money in
a trust or similar arrangement as departmental.
Items may be adjusted to take into account the transfer of functions
between agencies, in accordance with section 32 of the FMA Act. It is
possible that adjustments under section 32 may result in new items and/or
outcomes being created in an Appropriation Act. It might also result in
amounts being transferred between Appropriation Acts.
Clause 7--Departmental items
9 Clause 7 provides that the amount specified in a departmental item for
an agency may be applied for the departmental expenditure of the agency.
Clause 3 defines:
"departmental item" to be the total amount set out in Schedule 1 in
relation to an agency under the heading "Departmental"; and
"expenditure" to be payments for expenses, acquiring assets, making
loans or paying liabilities.
House of Representatives page 7 Appropriation Bill (No. 3) 2012-2013
Notes on clauses
10 While the departmental items in Schedule 1 may be divided between
outcomes, the different amounts against outcomes are notional. The total
appropriation for departmental expenses represents the departmental item.
11 Departmental items involve costs over which an agency has control.
Departmental appropriations can be used to make any payment related to the
functions of the agency including on purposes covered by other items whether
or not they are in the Act for an agency. Expenditure typically covered by
departmental items includes employee expenses, suppliers and other operational
expenses (e.g. interest and finance expenses). There can also be occasions when
an agency, such as a portfolio department, needs to cover matters in relation to
other areas of the Government. Examples can include whole-of-Government
activities or a portfolio department assisting with the formation and initial costs
of a new portfolio body (for which the department might later be reimbursed).
Another example would be where government has decided to implement shared
services arrangements, and one agency is providing corporate services
assistance to another agency.
12 Since 2010-2011, departmental items have included amounts
specifically to meet costs associated with the acquisition and capitalised
maintenance of departmental assets valued at $10 million or less. Departmental
items also include supplementation in circumstances when agencies were
directed by government to undertake additional responsibilities in the previous
financial year. This applies when the direction was given, or a decision to
propose further Appropriation Bills is made, in a timeframe within which it is
not practicable to include the expected expenses in a further Appropriation Bill
for that financial year.
13 Generally, agencies are expected to meet the cost of additionally
directed activities from their existing appropriations, which may then be
replenished by a departmental appropriation in the following financial year.
14 Departmental items are not expressed in terms of a particular financial
year and do not automatically lapse. Because the cash to meet expenses such as
employee entitlements can be required at times other than when the expenses
are incurred, the departmental appropriations remain available until required.
Departmental items are available until they are spent or reduced in accordance
with clause 10.
15 The Finance Minister manages the payment from departmental items by
agencies through the issuing of drawing rights in accordance with sections 26
and 27 of the FMA Act. Drawing rights control who may spend money from
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Notes on clauses
appropriations, and allow for conditions and limits to be set by the Finance
Minister (or the Finance Minister's delegate) in relation to those activities.
16 Amounts appropriated for departmental items can be subject to a
reduction process in accordance with clause 10 of the Bill. Clause 10 enables
the following people to make a written request to ask the Finance Minister to
make a determination to reduce an agency's departmental appropriation:
the Prime Minister or a Minister acting on behalf of the Prime Minister; the
Minister responsible for an agency; or the Chief Executive of an agency for
which the Finance Minister is responsible.
Clause 8--Administered items
17 Subclause 8(1) provides for the appropriation of administered amounts
to be applied by an agency for the purpose of contributing to the outcome for an
agency. An "administered item" is defined in clause 3 to be the amounts set out
in Schedule 1 opposite an outcome for an Agency under the heading
"Administered". Administered amounts are appropriated separately for
outcomes (i.e. unlike departmental items, the split across outcomes is not
notional), making it clear what the funding is intended to achieve. Schedule 1
specifies how much can be expended on each outcome.
18 The appropriations for administered items in Schedule 1 represent the
amounts required to meet the total estimated additional expenses for the
administered outcomes for 2012-2013.
19 The purposes for which each administered item can be spent are set out
in subclause 8(2). Subclause 8(2) provides that where the Portfolio Statements
indicate a particular activity is in respect of a particular outcome, then
expenditure on that activity is taken to be expenditure for the purpose of
contributing to achieving that outcome. The outcomes are not, however,
necessarily tied to the existence of a particular agency (e.g. abolishing a
department will not affect the valid operation of an appropriation for an
administered item for an outcome of that department, because the purpose of
the appropriation does not depend on the existence of the department).
20 Administered items are those administered by an agency on behalf of
the Government (e.g. certain grants, benefits and transfer payments). These
payments are usually made pursuant to eligibility rules and conditions
established by the Government or the Parliament. Specifically:
administered items are tied to outcomes (departmental items are not);
House of Representatives page 9 Appropriation Bill (No. 3) 2012-2013
Notes on clauses
administered items must be spent in accordance with rules and conditions
established by the Government or Parliament; and
there is a process in clause 11 for dealing with administered items that are
not fully expensed or spent during the financial year.
21 The Finance Minister manages payments from administered items by
agencies through the issuing of drawing rights in accordance with sections 26
and 27 of the FMA Act. Drawing rights control who may spend money from
appropriations, and allow for conditions and limits to be set by the
Finance Minister (or the Finance Minister's delegate) in relation to those
activities.
Clause 9--CAC Act body payment items
22 Clause 9 provides for direct appropriations of money for CAC Act
bodies to be paid from the CRF by the relevant department. Clause 9 provides
that payments for CAC Act bodies must be used for the purposes of those
bodies.
23 A "CAC Act body" is defined in clause 3 to be a Commonwealth
authority or a Commonwealth company within the meaning of the CAC Act.
Many CAC Act bodies receive funding directly from appropriations. However,
these bodies are legally separate from the Commonwealth, and as a result, do
not debit appropriations or make payments from the CRF.
24 CAC Act body payments are initiated by requests to the relevant
portfolio agencies from the CAC Act bodies. The Finance Minister manages
appropriations for CAC Act bodies through the issuing of drawing rights in
accordance with sections 26 and 27 of the FMA Act. Drawing rights control
who may spend money from appropriations and allow for conditions and limits
to be set by the Finance Minister (or the Finance Minister's delegate) in relation
to those payments. CAC Act bodies hold the amounts paid to them on their own
account.
25 Subclause 9(2) provides that if a CAC Act body is subject to another
Act that requires amounts appropriated by Parliament for the purposes of that
body to be paid to the body, then the full amount of the CAC Act body payment
must be paid to the body. The purpose of subclause 9(2) is to clarify that
subclause 9(1) is not intended to qualify any obligations in other legislation
regulating a CAC Act body, where that other legislation requires the
Commonwealth to pay the full amount appropriated for the purposes of the
body.
House of Representatives page 10 Appropriation Bill (No. 3) 2012-2013
Notes on clauses
26 The full amount of the CAC Act body payments specified in Schedule 1
may be reduced in accordance with clause 12. Subclause 12(6) provides that
subclause 9(2) does not prevent the CAC Act body payments in Schedule 1
being reduced.
27 In addition to the annual appropriations, some CAC Act bodies may also
receive public money from related entities such as a portfolio department and
from special appropriations managed by those departments. Many CAC Act
bodies also receive funds from external sources.
Part 3--Adjusting appropriation items
28 Part 3 of the Bill provides for reductions or increases to the amounts
specified in Schedule 1. The reduction provisions are contained in clauses 10
through 12 inclusive. The provision that can increase the amounts specified in
Schedule 1 is contained in clause 13.
29 The reduction provisions were amended in the 2010-2011 Budget Bills
to introduce additional mechanisms for initiating the reduction of unspent
items. The purpose of those changes was to increase the efficiency of the
reduction process particularly when surplus appropriations result from
government decisions.
Clause 10--Reducing departmental items
30 Departmental items remain available until the appropriation is spent or
reduced in accordance with clause 10. This clause enables surplus departmental
item appropriation amounts to be reduced to promote the efficient, effective,
economical and ethical management of any surplus appropriations. Agencies
should only spend all of a departmental item if there are government decisions
to support that expenditure. Examples of where clause 10 may be appropriate to
reduce a departmental item include:
an excessive amount was originally appropriated in error;
an amount is reclassified and appropriated again under another kind of
appropriation (e.g. where an amount appropriated as departmental is to be
reclassified as administered and a new administered appropriation is
provided). The existing departmental appropriation remains legally
available even though there is no government authority to spend the
funds;
efficiency savings result in a program costing less than expected; or
House of Representatives page 11 Appropriation Bill (No. 3) 2012-2013
Notes on clauses
a program is abolished under government policy before the appropriation
is expended.
31 Paragraph 10(1)(a) enables the Prime Minister, or a Minister acting on
behalf of the Prime Minister, to request that the Finance Minister reduce a
departmental item for an agency. Paragraph 10(1)(b) enables the Minister who
is responsible for the agency to request the Finance Minister to reduce a
departmental item for an agency. Paragraph 10(1)(c) enables the Chief
Executive of an agency for which the Finance Minister is responsible to request
the Finance Minister to reduce a departmental item for that agency.
Subclause 10(6) assists readers by noting that a request under subclause 10(1) is
not a legislative instrument within the meaning of section 5 of the Legislative
Instruments Act 2003 (LI Act), on the basis that it is requesting a determination
to be made, and it is the determination under subclause 10(2) that has
substantive effect.
32 Subclause 10(2) enables the Finance Minister to make a written
determination to reduce a departmental item. The Finance Minister is not
obliged to act on a request to reduce excess departmental item appropriations.
However, if the Finance Minister does:
the determination must be for the amount specified in the request:
subclause 10(2);
the determination may not reduce the departmental item below nil:
subclause 10(3); and
the departmental item in Schedule 1 will be taken to be reduced in
accordance with the determination of the Finance Minister:
subclause 10(4).
33 Subclause 10(5) provides that once a determination is made under
subclause 10(2), it must not be rescinded, revoked, amended or varied.
Subclause 10(5) applies despite subsection 33(3) of the AI Act. This subclause
intends to exclude the operation of subsection 33(3) of the AI Act from
determinations made under subclause 10(2). The purpose of subclause 10(5)
is to ensure that the departmental item appropriation, when reduced under
subclause 10(2), cannot be restored by means of a later determination.
34 Subclause 10(7) provides that a determination made under
subclause 10(2) is a legislative instrument.
House of Representatives page 12 Appropriation Bill (No. 3) 2012-2013
Notes on clauses
35 Despite subsection 44(2) of the LI Act, which provides that instruments
made under annual Appropriation Acts are not subject to disallowance,
subclause 10(7) provides that a determination reducing a departmental item is
subject to disallowance in accordance with section 42 of the LI Act. Parliament
retains the power to disallow a determination to reduce a departmental item,
because any such determination will reduce the amount of an appropriation
authorised by Parliament. Subclause 10(7) also confirms subsection 54(2) of the
LI Act, which provides that instruments made under annual Appropriation Acts
are not subject to sunsetting.
Clause 11--Reducing administered items
36 Clause 11 provides for amounts of administered items not required after
the end of the current year to be extinguished. If the government then decides
that amounts should be spent in a later financial year, the government must
request Parliament to appropriate these amounts in future Appropriation Bills.
37 Clause 11 limits the amount that may be applied for an administered
item to the amount reported for that item in an agency's annual report.
Subclause 11(1) provides that if the amount published in the annual report is
less than the amount of the item, then the administered item is taken to be
reduced to the amount specified in the annual report. The amount of the item
specified in Schedule 1 of the Bill may be increased or reduced by the other
clauses of Part 3 of the Bill, or in accordance with sections 30, 30A and 32 of
the FMA Act. The amount in the annual report must therefore be compared
with the amount for the item in Schedule 1, together with any other adjustments
that have been made to that amount.
38 Subparagraph 11(2)(a)(i) retains a power for the Finance Minister to
make a written determination specifying that subclause 11(1) does not apply in
relation to the item. Subparagraph 11(2)(a)(ii) enables the Finance Minister to
determine that an amount published in the financial statements of an agency,
is taken to be the amount specified in his or her determination. The power in
subparagraph 11(2)(a)(ii) is to ensure that the amount published for the
administered item in an agency annual report can be corrected through the
determination if, for example, the amount published is erroneous. Additionally,
the power in paragraph 11(2)(b) is to provide the Finance Minister with the
capacity to make a written determination in those cases where an agency has
failed to specify a required amount in its' annual report. In those cases the
amount specified in the determination as the required amount will be taken to
be the required amount for the purposes of subclause 11(1).
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Notes on clauses
39 Subclause 11(3) provides that a determination made under
subclause 11(2) is a legislative instrument.
40 Despite subsection 44(2) of the LI Act, which provides that instruments
made under annual Appropriation Acts are not subject to disallowance,
subclause 11(3) provides that a determination regarding an administered item is
subject to disallowance in accordance with section 42 of the LI Act. Parliament
retains the power to disallow a determination to reduce an administered item
because any such determination will reduce the amount of an appropriation
authorised by Parliament. Subclause 11(3) also confirms subsection 54(2) of the
LI Act, which provides that instruments made under annual Appropriation Acts
are not subject to sunsetting.
Clause 12--Reducing CAC Act body payment items
41 Clause 12 provides a process for reducing CAC Act body payment
items, which is similar to that for reducing departmental items. Paragraph
12(1)(a) enables the Prime Minister, or a Minister acting on behalf of the Prime
Minister, to request that the Finance Minister reduce a CAC Act body payment
item. Paragraph 12(1)(b) enables a Minister responsible for a CAC Act body, to
request that the Finance Minister reduce a CAC Act body payment item.
Paragraph 12(1)(c) enables the Secretary of the Finance Department to request a
reduction for a CAC Act body payment item for a body which the Finance
Minister is responsible. Subclause 12(7) assists readers by noting that a request
under subclause 12(1) is not a legislative instrument within the meaning of
section 5 of the LI Act, on the basis that it is requesting a determination under
subclause 12(2) to be made and it is the determination that has substantive
effect.
42 Subclause 12(2) enables the Finance Minister to make a written
determination to reduce a CAC Act body payment item. The Finance Minister
is not obliged to act on a request to reduce a CAC Act body payment item.
However, if the Finance Minister does:
the determination must be for the amount specified in the request:
subclause 12(2);
the determination may not reduce the CAC Act body payment item below
nil: subclause 12(3); and
the CAC Act body payment item in Schedule 1 will be taken to be
reduced in accordance with the determination of the Finance Minister:
subclause 12(4).
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Notes on clauses
43 Subclause 12(5) provides that a determination made under
subclause 12(2) once made, must not be rescinded, revoked, amended or varied.
Subclause 12(5) applies despite subsection 33(3) of the AI Act. This subclause
intends to exclude the operation of subsection 33(3) of the AI Act from
determinations made under subclause 12(2). The purpose of subclause 12(5) is
to ensure that the CAC Act body payment item appropriation, when reduced
under subclause 12(2), cannot be restored by means of a later determination.
44 Subclause 12(6) provides that the full amount that is required to be paid
to a CAC Act body by subclause 9(2) of the Bill may be reduced in accordance
with clause 12.
45 Subclause 12(8) provides that a determination made under
subclause 12(2) is a legislative instrument.
46 Despite subsection 44(2) of the LI Act, which provides that instruments
made under annual Appropriation Acts are not subject to disallowance,
subclause 12(8) provides that a determination reducing a CAC Act body
payment item is subject to disallowance in accordance with section 42 of the
LI Act. Parliament retains the power to disallow a determination to reduce a
CAC Act body payment item because any such determination will reduce the
amount of an appropriation authorised by Parliament. Subclause 12(8) also
confirms subsection 54(2) of the LI Act, which provides that instruments made
under annual Appropriation Acts are not subject to sunsetting.
Clause 13--Advance to the Finance Minister
47 Section 13 of the Appropriation Act (No. 1) 2012-2013 (Act No. 1)
enables the Finance Minister to provide additional appropriations for items
when satisfied that there is an urgent need for expenditure and the existing
appropriation is inadequate. This additional appropriation is referred to as the
Advance to the Finance Minister (AFM). Subsection 13(3) of Act No. 1
provides that the total amount that can be determined under the AFM provision
is $295 million.
48 Clause 13 of the Bill provides that irrespective of the amounts issued
from the AFM before the commencement of the Bill, the amount available
under section 13 of Act No. 1 will be restored to the original amount of
$295 million. The provision has been added to the Bill to ensure that there will
be sufficient scope to provide amounts from the AFM for the remainder of the
financial year.
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Notes on clauses
49 Subclause 13(1) specifies that if the Finance Minister has determined
under subsection 13(2) of Act No. 1 to increase an amount in Schedule 1 of
Act No. 1 from the AFM, then that amount is to be disregarded when the Bill
commences. From the date the Bill commences the total amount that can be
determined under the AFM will be $295 million.
50 Subclause 13(2) will prevent appropriations for the same expenditure
from both the AFM and the Bill. Subclause 13(2) ensures that if Schedule 1 of
the Bill provides an amount for a particular expenditure and, prior to the
commencement of the Bill, the Finance Minister determines an amount from
the AFM under section 13 of Act No. 1 for the same expenditure (the advanced
amount), then the appropriation in the Bill will be reduced by the amount of the
advanced amount. The appropriated amount cannot be reduced below nil. For
example if the Bill provides $20 million for a grants program and an advanced
amount of $5 million is determined by the Finance Minister under Act No. 1 for
a particular grant payment under that program, then the amount appropriated by
the Bill, once enacted, will be reduced by $5 million (i.e. appropriating only
$15 million for the grants program).
51 The Finance Minister may continue to make determinations under
subsection 13(2) of Act No. 1 to add an amount from the AFM to an item of an
agency if the criteria in subsection 13(1) of Act No. 1 are satisfied.
Part 4--Miscellaneous
Clause 14--Crediting amounts to Special Accounts
52 Clause 14 provides that if the purpose of an item in Schedule 1 is also
the purpose of a Special Account (regardless of whether the item expressly
refers to the Special Account), then amounts may be debited against the
appropriation for that item and credited to the Special Account. Special
Accounts may be established under the FMA Act by a determination of the
Finance Minister (section 20) or by another Act (section 21). The determination
or Act that establishes the Special Account will specify the purposes of the
Special Account.
Clause 15--Appropriation of the Consolidated Revenue Fund
53 Clause 15 provides that the CRF is appropriated as necessary for the
purposes of the Bill. Significantly, this clause means that there is an
appropriation in law when the Acts commence. That is, the appropriations are
not made or brought into existence just before they are paid but when the Royal
Assent is given. The words "as necessary" in this clause indicates that the
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Notes on clauses
amounts appropriated may be affected by the FMA Act, in particular
sections 30, 30A and 32 (see clause 6), after the Bill receives the Royal Assent.
Schedule 1--Services for which money is appropriated
54 Schedule 1 specifies the appropriations proposed for the ordinary annual
services of the Government. Schedule 1 contains a summary table which lists
the total amounts for each portfolio. A separate summary table is included with
further detail for each portfolio, with other tables detailing the appropriations
for each agency.
55 Schedule 1 includes for information purposes a figure for the previous
financial year printed in italics under each appropriation amount, labelled the
"Actual Available Appropriation". That figure provides a comparison with the
proposed appropriations. The Actual Available Appropriation does not affect
the amounts available at law.
56 More details about the appropriations in Schedule 1 are contained in the
Portfolio Statements and the second reading speech.
House of Representatives page 17 Appropriation Bill (No. 3) 2012-2013