Bills Digest 121 1996-97 Appropriation Bill (No. 3) 1996-97


Numerical Index | Alphabetical Index

WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

CONTENTS

Passage History

Appropriation Bill (No. 3) 1996-97

Date Introduced: 5 February 1997
House: House of Representatives
Portfolio: Finance
Commencement: The Act commences on the day on which it receives the Royal Assent

Purpose

To authorise the Minister for Finance to issue an additional $930 275 000 from the Consolidated Revenue Fund, in addition to funds appropriated by the Appropriation Act (No. 1) 1996 97, for the annual services of the government.

Background

Annual authorisations for expenditure are contained in the Appropriation Act (No. 1), which authorises expenditure for the ordinary services of government.The Appropriation Act (No. 2), deals with expenditure on capital works and services, payments to the States and other purposes not authorised by special legislation. The Parliamentary Departments are covered by the Appropriation (Parliamentary Departments) Bills.

Additional appropriations may be sought in further Appropriation Bills, commonly known as additional estimates, when the appropriation sought in the Appropriation Bills is insufficient for the financial year.

Supply Bills are required as a result of the timing factors in the Budget cycle. The Commonwealth financial year begins on 1 July, but the Budget may not be presented until August and it is usually not until November that the Appropriation Bills have been enacted. Since the Appropriation Bills of the previous financial year lapse on 30 June, a hiatus of approximately five months duration appears in the financial activities of the Government (In recent years there has been a move to bring the Budget down, whether possible, in May). This hiatus necessitates interim appropriations. This is achieved through the passing of Supply Bills shortly before the end of the previous financial year.

It is suggested that this Bills Digest be read in conjunction with the Parliamentary Research Service Budget Review 1996-97.

This Bill is a 'top up' bill and for this reason the sum appropriated, $930 275 000 is comparitively small.

The major additional appropriations effected by this Bill are:

  • Department of the Treasury $519 841 000 - $510 000 000 is appropriated to acquire the debt of the Australian National Railways Commission.
  • Department of Health and Family Services $93 551 000:
  • $19 658 000 for further administrative running costs,
  • $39 140 000 for capital assistance for residential facilities,
  • $27 429 000 in respect of the Health Insurance Commission for spending in accordance with the Health Insurance Commission Act 1973.The Minister's second reading speech states that this reflects increased funding for the Double Dipping Initiative and higher administrative costs associated with changes to the Child Care Cash Rebate payments to high income families as a result of the decision to reduce the rebate payments for families above the Family Tax Initiative income cutoff.'Double Dipping' in this context occurs where a person receives a compensation payment to cover medical and other care costs for their injury but also continues to claim these costs from the Commonwealth through medicare or nursing care.
  • Department of Defence $92 540 000:
  • $29 111 000 for compensation and legal expenses.The Minister's second reading states that $17 000 000 is compensation associated with the Cockatoo Island Dockyard and the balance is for a range of other claims.Question 96 from page 2714 of Hansardfor 20 August 1996 should be noted.It is set out at Endnote 1.
  • $40 028 000 for equipment and stores.The Minister's second reading speech states that this is largely related to increased purchases of fuel for joint exercises with the United States and that the increase will be offset by recoveries of costs from the United States.
  • $10 050 000 for facilities operations.The Minister's second reading speech states that this reflects an increased provision for repairs and maintenance and minor new works activities.
  • $6 000 000 to be paid to Aerospace Technologies of Australia Aircraft Services Proprietary Limited in respect of Avalon Airport Geelong Limited.
  • Department of Veterans' Affairs $60 900 000:
  • $17 604 000 for payments to Local Medical Officers and specialist consultations and services for veterans
  • $16 660 000 for maintenance of patients in non-departmental institutions
  • $7 535 000 for payments for allied health services for veterans
  • The Minister's second reading speech states that these amounts reflect an increased demand for those services together with the clearance of a claims backlog associated with the transfer of claims processing to the Health Insurance Commission in December 1995.
  • $12 440 000 for pharmaceutical services.

Main Provisions

Clause 3 authorises the Minister for Finance to issue from the Consolidated Revenue Fund a total of $930 275 000 in respect of the year ending 30 June 1997.The Schedule gives a portfolio and program breakup of the proposed expenditure.

Clause 4 authorises the Minister for Finance to issue additional funds in respect of increases in salaries in 1996 97.

Other provisions of this Bill primarily provide for item changes that may arise from the creation of various proposed agencies, such as the National Science and Technology Centre, the Gene Technology Authority, the Aged Care Standards Agency and the Productivity Commission.

Endnotes


  1. Cockatoo Dockyard

    (Question No. 96)

    Senator Margetts asked the Minister for Defence, upon notice, on 11 June 1996 With reference to the litigation involving the department and the contractor in relation to the former Cockatoo Dockyard at Cockatoo Island in Sydney Harbour

    (1) What is the current position with the arbitration proceedings relating to Cockatoo Island and dockyard

    (2)(a) What awards have been made; (b) what awards are expected to be made; an

    (c) what are the amounts of the awards (3)(a) What legal costs have been incurred by the parties to date; and (b) what further legal costs are expected.

    Senator Newman--The Minister for Defence has provided the following answer to the honourable senator's question

    (1) The arbitration proceedings involved two main aspects. Cockatoo Dockyard Pty Ltd (CODOCK) sought damages for breach of contract arising from the former Government's 1990 decision to cease Oberon submarine refits at Cockatoo island dockyard. Arbitration hearings on that aspect are completed. An interim award, except for the matter of legal costs, has been given in a decision by the Arbitrator. The Commonwealth is seeking leave to appeal that decision in the NSW courts. The second aspect involves the Commonwealth's claim against CODOCK for alleged contamination of Cockatoo island. The arbitration is currently adjourned on that aspect pending a resolution of the Commonwealth's application to have its claims heard, as a preference, by the NSW Courts. The NSW Supreme Court hearings on that application commenced on 12 June 1996

    (2)(a) See the above answer

    (b) Decisions on legal costs and any award in the Commonwealth's contamination claim are outstanding

    (c) An interim award was given by the Arbitrator against the Commonwealth of $10 864 240 plus interest of $5 315 355 as at 8 December 1995. However, that interim award is being challenged as I have indicated

    (3)(a) Since 1992 93 the legal costs have involved three main elements: those borne by the Attorney General's Department totalling some $7.9m, the costs involved with non-Commonwealth support including barristers totalling some $5.7m, and expert consultancies including environmental studies amounting to $3.6m. These costs cover both aspects of the arbitration and NSW court proceedings related thereto. The legal costs incurred by CODOCK, or its parent Australian National Industries Ltd, are a matter for those parties to confirm

    (b) A further $1.5m has been budgeted for next financial year but this may vary depending upon the duration of legal proceedings and the outcome of appeal applications.

Contact Officer and Copyright Details

Lee Jones
24 March 1997
Bills Digest Service
Information and Research Services

This Digest does not have any official legal status. Other sources should be consulted to determine whether the Bill has been enacted and, if so, whether the subsequent Act reflects further amendments.

IRS staff are available to discuss the paper's contents with Senators and Members and their staff but not with members of the public.

ISSN 1323-9031
© Commonwealth of Australia 1996

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1997.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 9 April 1997


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