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Thursday, 26 November 2009
Page: 12965

Dr EMERSON (Minister for Small Business, Independent Contractors and the Service Economy, Minister Assisting the Finance Minister on Deregulation and Minister for Competition Policy and Consumer Affairs) (9:10 AM) —I move:

That this bill be now read a second time.

There are two additional estimates bills this year: Appropriation Bill (No. 3) and Appropriation Bill (No. 4). I shall introduce the latter bill shortly.

The additional estimates bills seek appropriation authority from parliament for the additional expenditure of money from the Consolidated Revenue Fund in order to meet requirements that have arisen since the last budget.  The total additional appropriation being sought through additional estimates bills 3 and 4 this year is a little over $2 billion.

Turning to Appropriation Bill (No. 3), the total appropriation being sought this year is $1.69 billion. This proposed appropriation arises from changes in the estimates of program expenditure, due to variations in the timing of payments and forecast increases in program take-up, reclassifications and from policy decisions taken by the government since the last budget.

I now outline the major appropriations proposed in the bill.

The government will provide an additional $510.8 million to the Department of the Environment, Water, Heritage and the Arts to meet commitments under the Solar Homes and Communities Plan. This program was terminated on 9 June 2009, and replaced by the Solar Credits Scheme. The new program provides assistance to households, small businesses and community groups with the upfront costs of eligible small-scale renewable energy systems installed after 9 June 2009 through the expanded Renewable Energy Target.

In addition, the government will adjust funding for the National Rainwater and Greywater Initiative, to meet lower-than-expected demand, resulting in a saving of $13 million in the current financial year. It will also reduce funding for project contingencies under the Water Smart Australia program, saving a further $10 million in 2009-10.

The government will also provide the Department of the Environment, Water, Heritage and the Arts with $16.1 million for the Tasmanian forest package. In addition, an unspent amount of $20.1 million, resulting from project delays, will be carried forward from last financial year for the Living Murray Initiative.

The government proposes to bring forward $290 million from 2011-12 for the Department of the Environment, Water, Heritage and the Arts to meet an increase in demand for the Home Insulation Program. This amount is in addition to the $695.8 million proposed in the Appropriation (Water Entitlements and Home Insulation) Bill 2009-2010 introduced into parliament on 18 November 2009, the funding for which is required by December 2009. The $290 million proposed in this bill is required less urgently and will meet demand for the program in the months following passage of the additional estimates appropriation bills.

The Department of the Environment, Water, Heritage and the Arts will also be provided with $24.8 million for the Climate Change Action Fund, which is matched by a corresponding reduction in the funding for the Department of Climate Change.

The government is proposing to provide the Department of Health and Ageing with $45.2 million in response to the H1N1 influenza virus pandemic. The funding seeks to manage this pandemic and to enhance preparedness for any future pandemics by supporting activities such as:

  • the storage, compounding and distribution of antivirals and personal protective equipment;
  • the production, processing and distribution of immunisation consent forms; and
  • the conduct of an immunisation awareness campaign.

In addition, the Department of Health and Ageing will be provided with $12.4 million which was unspent last financial year because of project delays for the Zero Real Interest Loans program. The program provides capital funding to build and expand residential aged care and respite facilities in areas of high need.

The government will streamline arrangements and introduce efficiencies at Centrelink to deliver substantial savings over the next four years. From 1 July 2010, paper forms received by Centrelink will be scanned to reduce the cost of transferring forms between Centrelink sites and to reduce storage of paper documents. This initiative is expected to deliver net savings of $131.3 million over four years. An amount of $12.4 million is proposed in bill 3 to prepare for the introduction of the streamlined arrangements.

In addition, the government will streamline the arrangements for job seekers from 1 July 2010 with the fortnightly income reporting requirements being met through electronic lodgement over the internet, or by telephone utilising interactive voice recognition software. This measure is expected to deliver net savings of $95.2 million over four years. Appropriation Bill (No. 3) includes $14.5 million for Centrelink to implement this initiative.

The Department of Education, Employment and Workplace Relations will be provided with the following additional amounts. First, $40 million to meet an increase in demand for assistance from the General Employee Entitlements and Redundancy Scheme due to a rise in bankruptcies and insolvencies. This is a basic payment scheme designed to assist employees who have lost their employment as a result of the insolvency of their employer and are owed certain employee entitlements. Second, an amount of $20.3 million will be provided to establish environmental and heritage training and work experience placements, lasting 26 weeks, for young people aged 17 to 24.

The government will provide the Defence Materiel Organisation with $43.4 million for personnel and other operating costs associated with delivering additional activities required to be performed on behalf of the Department of Defence. This increase is matched by a reduction in the Department of Defence’s departmental operating expenses.

An additional appropriation is proposed for the Department of Immigration and Citizenship as follows.

First, an amount of $63 million will be provided to meet the cost of increased irregular maritime arrivals. Second, a further $11.2 million is proposed to expand Christmas Island’s accommodation capacity in response to increased irregular maritime arrivals.

These increases are partially offset by a reduction of $19.3 million resulting from lower than expected activity levels in the department’s visa and migration services.

The government proposes an additional $19.95 million for the Department of Families, Housing, Community Services and Indigenous Affairs, for payments under the National Rental Affordability Scheme due to a greater than expected number of charities looking to participate in the scheme. This change is accompanied by a reduction in the estimated administered refundable tax offsets payments and results in an overall budget neutral rebalancing of estimates between the department and the Australian Taxation Office in 2009-10.

The Australian tax office will be provided with $11.3 million, which has been carried forward from last financial year, to fund a public awareness campaign concerning the Small Business and General Business Tax Break—hear, hear!—the passage of legislation for which was delayed until May 2009.

The appropriations that I have outlined so far are proposed to meet additional funding requirements that have arisen since the last budget. There is a further category of requirements for additional appropriation, referred to as a ‘reclassification of appropriation’, that are also proposed in Appropriation Bill (No.3).

These amounts need to be re-appropriated to align the purpose of the proposed spending with the correct appropriation type. The additional appropriations are fully offset by savings against the original appropriations and thus do not lead to additional expenditure.

I now outline the material reclassifications proposed in bill 3. First, the Department of Defence will be provided with $639.2 million in departmental outputs appropriation to align its appropriations with its work program. The additional amount will be more than fully offset by reductions in its non-operating appropriations, resulting in a net saving to the budget overall. Second, the Department of the Environment, Water, Heritage and the Arts will be provided with $118.7 million as an administered expense appropriation for the Sustainable Rural Water Use and Infrastructure program. This amount represents a reclassification of appropriation from the Administered Assets and Liabilities appropriation provided in the last budget. Third, the Department of Education, Employment and Workplace Relations will receive $42.6 million for the Support for Child Care Program. This amount, which was originally appropriated in Appropriation Act (No. 2) as a states, ACT, NT and local government item, has been identified as a Commonwealth Own Purpose Expense and so has been reclassified.

The remaining amounts that appear in Appropriation Bill (No. 3) relate to estimates variations, minor reclassifications and other minor measures.

I would like to turn now to a new clause that is included in bill No. 3. The new clause gives effect to the government’s decision to reduce the amounts of unspent or uncommitted depreciation and make-good funding that agencies have accumulated since the introduction of accrual appropriations in 1999-2000. This clause will operate separately and in addition to the current appropriation reduction provisions. The clause will apply to both the departmental outputs and administered expenses appropriations. A similar clause is provided in Appropriation Bill (No. 4). It is intended that the new clauses will only appear in these additional estimates bills and will not be required in future bills. The proposed new clause is discussed in the explanatory memorandum. I commend the bill to the House.

Debate (on motion by Mr Lindsay) adjourned.

Ordered that the resumption of the debate be made an order of the day for the next sitting.