Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Financial Management Legislation Amendment Bill 1999
Schedule 1 Amendments and repeals

   

Financial Management and Accountability Act 1997

1  Reader’s guide (second paragraph under the heading “Overview of this Act”)

Repeal the paragraph.

2  Reader’s guide (third paragraph under the heading “Overview of this Act”)

Omit “This Act also has”, substitute “This Act contains”.

3  Reader’s guide (paragraph that summarises Part 4)

Repeal the paragraph, substitute:

        Part 4   Accounting, appropriations and payments : This Part establishes an accounting framework for public money that involves the Consolidated Revenue Fund and a system of accounts called Special Accounts. This Part has a number of rules that apply to Parliamentary appropriations. It also deals with miscellaneous matters such as act of grace payments by the Commonwealth and waiver of debts owing to the Commonwealth.

4  Reader’s guide (paragraph that summarises Part 8)

Omit “of transactions of the Funds”.

5  Section 5 (definition of appropriation )

Repeal the definition, substitute:

appropriation means an authority under this Act or any other law to draw money from the Consolidated Revenue Fund, whether or not the law concerned uses the word “appropriation” or “appropriated”.

6  Section 5 (definition of Commercial Activities Fund )

Repeal the definition.

7  Section 5 (definition of Consolidated Revenue Fund )

Repeal the definition.

8  Section 5

Insert:

CRF or Consolidated Revenue Fund means the Consolidated Revenue Fund referred to in section 81 of the Constitution.

9  Section 5 (definition of Drawn Money )

Repeal the definition.

10  Section 5 (definition of Fund )

Repeal the definition.

11  Section 5 (definition of Loan Fund )

Repeal the definition.

12  Section 5 (definition of Received Money )

Repeal the definition.

13  Section 5 (definition of Reserved Money Fund )

Repeal the definition.

14  Section 5

Insert:

Special Account means:

                     (a)  a Special Account that is established by the Finance Minister under section 20; or

                     (b)  a Special Account that is established by an Act other than this Act.

Note:          See also the Financial Management Legislation Amendment Act 1999 , which converted components of previously existing funds into Special Accounts.

15  Section 6 (note)

Repeal the note, substitute:

Note:          This section applies to transactions that do not actually involve payments or receipts, because the parties to the transaction are merely parts of the Commonwealth, or acting as agents for the Commonwealth. For example, Agency 1 “pays” Agency 2 for services provided by Agency 2. One of the effects of this section is that a drawing right under section 27 will be required for the transaction.

16  Part 4 (heading)

Repeal the heading, substitute:

Part 4 Accounting, appropriations and payments

17  Division 1 of Part 4

Repeal the Division, substitute:

Division 1 Accounts and records in relation to public money

19   Accounts and records in relation to public money

                   The Finance Minister must cause proper accounts and records to be kept in relation to the receipt and expenditure of public money.

Note:          Section 48 requires Chief Executives of Agencies to keep accounts and records in accordance with the Finance Minister’s Orders.

Division 1A Special Accounts

20   Establishment of Special Accounts by Finance Minister

             (1)  The Finance Minister may make a written determination that does all or any of the following:

                     (a)  establishes a Special Account;

                     (b)  allows or requires amounts to be credited to the Special Account;

                     (c)  specifies the purposes of the Special Account.

             (2)  The Finance Minister may make a determination that revokes or varies a determination made under subsection (1).

             (3)  The Finance Minister may make a determination that abolishes a Special Account established under subsection (1).

             (4)  The CRF is hereby appropriated for expenditure for the purposes of a Special Account established under subsection (1), up to the balance for the time being of the Special Account.

             (5)  Whenever an amount is debited against the appropriation in subsection (4), the amount is taken to be also debited from the Special Account.

21   Special Accounts established by other Acts

             (1)  If another Act establishes a Special Account and identifies the purposes of the Special Account, then the CRF is hereby appropriated for expenditure for those purposes, up to the balance for the time being of the Special Account.

Note:          An Act that establishes a Special Account will identify the amounts that are to be credited to the Special Account.

             (2)  Whenever an amount is debited against the appropriation in subsection (1), the amount is taken to be also debited from the Special Account.

22   Disallowance of determinations relating to Special Accounts

             (1)  This section applies to a determination made by the Finance Minister under subsection 20(1) or (2).

             (2)  The Finance Minister must cause a copy of the determination to be tabled in each House of the Parliament.

             (3)  Either House may, following a motion upon notice, pass a resolution disallowing the determination. To be effective, the resolution must be passed within 5 sitting days of the House after the copy of the determination was tabled in the House.

             (4)  If neither House passes such a resolution, the determination takes effect on the day immediately after the last day upon which such a resolution could have been passed.

18  Paragraph 26(b)

Omit “from a Fund”, substitute “against an appropriation”.

19  Paragraph 26(c)

Omit “from a Fund”, substitute “against an appropriation”.

20  Paragraph 27(1)(b)

Omit “from a Fund”.

21  Paragraph 27(1)(c)

Omit “from a Fund”.

22  Subsections 27(2) and (3)

Repeal the subsections, substitute:

             (2)  If a law requires the payment of an amount of public money and there is an available appropriation for that payment:

                     (a)  the Finance Minister must issue sufficient drawing rights to allow the amount to be paid in full; and

                     (b)  the recipient of any of those drawing rights must exercise the rights in full.

             (3)  If a law permits the payment of an amount of public money, but does not require the payment of that amount, there is no obligation to issue or exercise drawing rights for that amount.

23  Paragraph 28(1) (b)

Omit “of any Fund”.

24  Subsections 28(2) and (3)

Repeal the subsections, substitute:

             (2)  The CRF is appropriated for the repayment.

             (3)  If the amount received by the Commonwealth was credited to a Special Account, then the repayment must be debited from that Special Account.

25  Section 29

Repeal the section.

26  Section 30

Repeal the section, substitute:

30   Appropriation to be reinstated for amounts re paid

                   If an amount is repaid to the Commonwealth after having been paid out of the CRF under the authority of an appropriation, then the appropriation has effect as if the amount had not been paid out.

Note:          The amount repaid will be available to be paid out again, subject to any time limits that apply to the appropriation.

27  Subsection 31(5) (definition of item )

Repeal the definition.

28  Subsection 35(5)

Omit “a Fund”, substitute “the CRF”.

29  Section 39

Repeal the section, substitute:

39   Investment of public money

             (1)  The Finance Minister may invest public money in any authorised investment.

             (2)  For the purpose of managing the public debt of the Commonwealth, the Treasurer may invest public money in any authorised investment.

             (3)  An investment of public money under this section must not be inconsistent with the terms of any trust that applies to the money concerned.

             (4)  If an amount invested under this section was debited from a Special Account, then expenses of the investment may be debited from that Special Account.

             (5)  Upon realisation of an investment of an amount debited from a Special Account, the proceeds of the investment must be credited to that Special Account.

             (6)  At any time before an investment matures, the Finance Minister or Treasurer, as the case requires, may authorise the re-investment of the proceeds upon maturity in an authorised investment with the same entity.

Note:          The proceeds of investment of the original investment will not become public money when the investment matures because the proceeds will not be received by or on behalf of the Commonwealth.

             (7)  The corporation established by section 62B of the Audit Act 1901 is continued in existence for the purposes of this section with the name “The Minister for Finance of the Commonwealth”. Investments by the Finance Minister under this section must be made in that corporate name.

             (8)  The corporation established by section 8 of the Loan Consolidation and Investment Reserve Act 1955 is continued in existence for the purposes of this section with the name “The Treasurer of the Commonwealth”. Investments by the Treasurer under this section must be made in that corporate name.

             (9)  The CRF is appropriated as necessary for the purposes of this section.

           (10)  In this section:

authorised investment means:

                     (a)  in relation to the Finance Minister—any of the following investments:

                              (i)  securities of the Commonwealth or of a State or Territory;

                             (ii)  securities guaranteed by the Commonwealth, a State or a Territory;

                            (iii)  a deposit with a bank, including a deposit evidenced by a certificate of deposit;

                            (iv)  any other form of investment prescribed by the regulations; and

                     (b)  in relation to the Treasurer—any of the following investments:

                              (i)  securities of the Commonwealth or of a State or Territory;

                             (ii)  securities guaranteed by the Commonwealth, a State or a Territory;

                            (iii)  a deposit with a bank, including a deposit evidenced by a certificate of deposit;

                            (iv)  debt instruments issued or guaranteed by:

                                        (A)  the government of a foreign country; or

                                        (B)  a financial institution whose members consist of foreign countries, or of Australia and foreign countries;

                                   being debt instruments with a credit rating that is consistent with the sound management of public debt;

                             (v)  any other form of investment prescribed by the regulations.

30  After subsection 53(1)

Insert:

          (1A)  If the Chief Executive delegates to a person (the second delegate ) a power or function that has been delegated to the Chief Executive under section 62, then that power or function, when exercised or performed by the second delegate, is taken for the purposes of this Act to have been exercised or performed by the Finance Minister.

31  Section 54

Repeal the section, substitute:

54   Finance Minister must publish monthly financial statements

             (1)  As soon as practicable after the end of each month of a financial year, the Finance Minister must publish financial statements in relation to that month.

             (2)  The statements must be in a form that is consistent with the budget estimates for the financial year.

             (3)  The statements may include any additional information that the Finance Minister considers relevant.

32  After section 62

Insert:

62A   Treasurer may delegate powers

             (1)  The Treasurer may, by written instrument, delegate to an official any of the Treasurer’s powers or functions under this Act.

             (2)  In exercising powers or functions under a delegation, the official must comply with any directions of the Treasurer.

33  Appendix A

Repeal the Appendix.

Loan Consolidation and Investment Reserve Act 1955

34  The whole of the Act

Repeal the Act.

 

 

(4/99)



[ Minister’s second reading speech made in—

House of Representatives on 10 February 1999

Senate on 22 March 1999 ]