Bills Digest no. 133 2005–06
Appropriation
Bill
(No.2)
2006-2007
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
Purpose
Background
Main Provisions
Concluding Comments
Endnotes
Contact Officer & Copyright Details
Passage History
Of the appropriation Bills introduced to accompany the May Budget,
by far the most important in dollar terms is Appropriation Bill
(No. 1), which appropriates funds for the ordinary annual services
of the government while Appropriation Bill (No. 2) appropriates
funds for other annual services. Section 54 of the Constitution
requires that there be a separate law appropriating funds for the
ordinary annual services of the government. That is why there are
separate bills for ordinary annual services and for other annual
services. The distinction between ordinary and other annual
services was set out in a Compact between the Senate and the
government in 1965 (the Compact was updated to take account of the
adoption of accrual budgeting).
The Appropriation Bill (No. 2) 2006-2007
(the
Bill)
provides funding for agencies to
meet:
expenses in relation to grants to the
States under section 96 of the Constitution and for payments to
the Northern
Territory, the
Australian Capital
Territory and local government
authorities;
-
administered expenses for new
outcomes;
-
requirements for departmental equity
injections, loans and previous years outputs;
and
-
requirements to create or acquire
administered assets and to discharge administered
liabilities.
The total appropriated by the
Bill
is approximately $9.215 billion (as compared to the
Appropriation Act (No. 2)
2005-2006, where the amount was approximately $7.87
billion).(1)
The main provisions of the
Bill
largely follow those of Appropriation Act (No. 2)
2005-06, with a few minor deletions to take account of
redundant provisions. However, local government authorities are
recognised in the Bill for the first time.
New section 4
provides that Portfolio Budget Statements are to be considered as
relevant extrinsic interpretational material under section 15AB of
the
Acts Interpretation Act 1903.
New section 6
lists the total amount appropriated by the
Bill
$9,214,607,000. The actual appropriation is done under
new section
16.
New
Section 7 deals with the basic
appropriation of funds to be paid to States, the Northern
Territory, the Australian Capital Territory and local government
authorities. Subsection
7(1) limits the amount of money the Finance Minister can
issue from the Consolidate Revenue Fund to the lesser of the amount specified in
Schedule 2,
and the amount that the Finance Minister includes in a
determination. Such determinations are not legislative instruments
and thus not disallowable by Parliament under the Legislative Instruments Act 2003.
The payments to the States, the Northern Territory, the
Australian Capital Territory and local government authorities may
only be for the purpose of contributing to the relevant agency
outcome listed in Schedule 2.
New
Section 8 deals with the basic
appropriation of funds for administered items. Subsection
8(1) limits the amount of money the Finance Minister can
issue from the Consolidate Revenue Fund to the lesser of the amount specified in
Schedule 2,
and the amount that the Finance Minister includes in a
determination. Such determination are not legislative instruments
and thus not disallowable by Parliament under the Legislative Instruments Act 2003.
The amounts appropriated may be used for the carrying out of
agency activities for the purpose of contributing to the relevant
agency outcome listed in Schedule 2.
New section 11
provides that the responsible portfolio Minister may request the
Finance Minister to make a written determination reducing an
administered asset or liabilities item or other departmental item
in the budget of an entity within their portfolio. The amount of
reduction is to be no greater than the amount requested, or, where
payments have already been made from the Consolidated Revenue Fund,
the difference between the amount appropriated to an item and the
amount already paid. For entities within the Finance Minister s
portfolio, the reduction request must come from the Chief Executive
of the relevant entity. Subsection
11(9)
provides that a determination may be disallowed by either House of
Parliament in accordance with the provisions of section 42 of
the
Legislative Instruments Act 2003.
Under new section
12, the Finance Minister is able to increase the amount
appropriated for certain items, such as equity injections, listed
in
Schedule 2.
The maximum additional amount available under new section
12
is a total of $20 million. Similar provisions are contained in
previous appropriation Acts.
Such determinations are legislative instruments, but are not
disallowable
under the
Legislative Instruments Act 2003:
new subsection
12(3).
New section 13
effectively allows the Finance Minister to increase the total
amount appropriated in Schedule 2 by up to $215
million in urgent cases were the need for additional amount was
unforeseen or not provided for due to an erroneous omission or
understatement . A determination by the Finance Minister
increasing the appropriation is a legislative instrument, but not
disallowable
under the
Legislative Instruments Act 2003:
new subsection
13(4).
For specific payments to States, Territories and local government
authorities, the relevant portfolio Minister (listed in
column 3
of
Schedule 1)
is able to determine conditions under which payments can be made:
new section
15. Such determinations are not
legislative instruments and thus not disallowable by Parliament
under the Legislative
Instruments Acts 2003.
Concluding
comments
In previous equivalent appropriation
Bills, local government authorities have not been mentioned as one
of the entities who receive the funds appropriated - only States
and Territories have been. Presumably the change is to facilitate
payments going directly to local government authorities rather than
through State or Territory governments.
-
Although with later
adjustments, the actual available 2005-2006 appropriation appears
to have been 9.045 billion. See p. 18 of the Bill.
Angus Martyn
19 May 2006
Bills Digest Service
Information and Research Services
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ISSN 1328-8091
© Commonwealth of Australia 2006
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Published by the Parliamentary Library, 2006.
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