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
Appropriation Bill (No. 3) 1997-98
Date Introduced: 29 October 1997
House: House of Representatives
Commencement: Royal Assent
To authorise the Minister for Finance to issue an additional $1
173 388 000 from the Consolidated Revenue Fund, in addition to
funds appropriated by the Appropriation Act (No.1)
1997-98, for the annual services of the government.
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) Act (No. 1).
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.
Glossary of Terms
Appropriation - is the setting apart, assigning or
applying to a particular use or to a particular person a sum of
money. In the budget context an appropriation usually refers to an
authorisation by Parliament to draw on funds from the Consolidated
Revenue Fund (CRF).
Budget Outlays - refer to the net cost to the taxpayer
of providing government services. Appropriations/payments out of
the CRF are adjusted to take account (for example) of many
government receipts. Hence a hypothetical government program 'XYZ'
may have a total appropriation of $600 million but this may only
represent budget outlays of $500 million if the 'XYZ' receives
income of $100 million from other (non budget) sources.
Running costs - are the full current and minor capital
costs incurred by a department or agency in providing government
services for which the department or agency is responsible. For
many departments, staff salaries will represent the largest
proportion of such costs.
Borrowings - Borrowings allow agencies to bring forward
some future years appropriation to be spent in an earlier year.
This is intended to provide agencies with the flexibility to
respond to changing spending priorities; and a mechanism to meet
Borrowings are arranged either through annual appropriation or
additional estimates Bills, such as is the case with this Bill,
with a consequent reduction in a future appropriation, or through
the Provision for Running Costs Borrowing (PRCB) where the
borrowing does not coincide with an Appropriation Bill.
Agencies are allowed to borrow up to 10% of the total running
costs budget from any one year.
Running Costs Borrowings (PRCB) - The PRCB is a reserve
that agencies can draw on to borrow running costs funds from future
appropriation where it is not viable to wait until the passage of
the next Appropriation Bill. Agencies can borrow from the PRCB if:
there is a legitimate reason to borrow running costs; the agency
has a running costs appropriation; the borrowings are repaid in
full from some future appropriation; and sufficient funds are
It is suggested that this Bills Digest be read in conjunction
with the Parliamentary Research Service Budget Review
Outline of Major Additional Appropriations
The major additional appropriations effected by this Bill
- Department of the Veterans' Affairs - $301 861 000. Of that
total $245 189 000 is appropriated for the maintenance of patients
in non-departmental institutions. Note: The rationale given by the
Minister in the Second Reading Speech to the Bill for the $245 189
000 in additional appropriations, is that the amount '... largely
reflecting to a self balancing transfer of $189 million from the
Nursing Homes Benefit special appropriation in the Department of
Health and Family Services following the Government's decision that
responsibility for residential aged care for veterans would be
centralised in the Department of Veterans' Affairs.
- Department of the Treasury $204 346 000. Of that total $174 000
000 is appropriated for acquisition of debt of the Australian
National Railways Commission.
- Department of Finance and Administration $157 853 000. Of that
total $71 000 000 is appropriated for business sales and
restructuring. The rationale given by the Minister in the Second
Reading Speech to the Bill for the $71 000 000 in additional
appropriations, is that the amount is required '... for managing
surplus staff of the former Department of Administrative Services
business units for which the actual costs could not be reliably
determined until arrangements for the sale of the businesses had
- An amount of $40 026 000 is also appropriated for the costs of
major asset sales. The rationale given by the Minister in the
Second Reading Speech to the Bill for the additional appropriation
is that it is '... largely attributable to an anticipated increase
in the sales commission as a result of an expected increase in the
proceeds of the partial privatisation of Telstra.'
- Department of Defence $111 121 000. Of that total $88 135 000
is appropriated for equipment and stores. The Minister in the
Second Reading Speech to the Bill states that the $88 135 000 for
equipment and stores is required '... for high priority logistic
items including spares and equipment repair activities.'
Clause 3 authorises the Minister for Finance to
issue from the Consolidated Revenue Fund a total of $1 173 388 000
in respect of the year ending 30 June 1998. The Schedule gives a
portfolio and program breakup of the proposed expenditure.
Clause 5 authorises the Minister for Finance to
issue additional funds in respect of increases in salaries in
Other provisions of this Bill primarily provide for item changes
that may arise from the creation of various proposed schemes,
programs and agencies, such as the employment subsidy scheme or
program, the Human Rights and Responsibilities Commission, the
Office of the Privacy Commissioner, the Australian Prudential
Regulation Authority, the Australian Corporations and Financial
Services Commission and the Productivity Commission.
17 November 1997
Bills Digest Service
Information and Research Services
This paper has been prepared for general distribution to
Senators and Members of the Australian Parliament. While great care
is taken to ensure that the paper is accurate and balanced, the
paper is written using information publicly available at the time
of production. The views expressed are those of the author and
should not be attributed to the Information and Research Services
(IRS). Advice on legislation or legal policy issues contained in
this paper is provided for use in parliamentary debate and for
related parliamentary purposes. This paper is not professional
legal opinion. Readers are reminded that the paper is not an
official parliamentary or Australian government document.
IRS staff are available to discuss the paper's contents with
Senators and Members
and their staff but not with members of the public.
© Commonwealth of Australia 1997
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
Published by the Department of the Parliamentary Library,
This page was prepared by the Parliamentary Library,
Commonwealth of Australia
Last updated: 18 November 1997
Back to top