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Tuesday, 23 August 1983
Page: 57

Mr DAWKINS (Minister for Finance)(9.24) —I move:

That the Bill be now read a second time.

The purpose of the Bill is to make provision for the financing of the prospective 1983-84 Budget deficit. The Budget deficit in prospect for 1983-84 gives rise to a deficit in the Consolidated Revenue Fund of about the same magnitude and thus creates a need to seek authority to finance certain expenditures from borrowings to the extent that amounts appropriated by the Parliament for expenditure from the Consolidated Revenue Fund will exceed moneys legally available to that Fund. Legally, expenditure from the Consolidated Revenue Fund cannot exceed the moneys available to that Fund. Thus, successive governments have, for many years, introduced legislation in the form of a loan Bill to authorise payments from the Loan Fund to meet defence and certain non- defence expenditures.

In the Budget Speech the Treasurer (Mr Keating) announced that the prospective Budget deficit for this financial year is estimated to be some $8.4 billion. The shortfall in the Consolidated Revenue Fund is estimated to be of the same order. Under existing standing authorities some $2 billion of expenditure can be charged to Loan Fund. This leaves a shortfall of some $6.4 billion for which separate funding authority is required. This Bill therefore seeks authority to borrow moneys for defence and other purposes to enable certain other expenditures to be met from the Loan Fund rather than from the Consolidated Revenue Fund. I should make it clear, however, that the Bill does not authorise defence or other expenditures additional to those otherwise authorised by parliament.

The Bill does not include any specific limit on the amount of borrowings that may be undertaken. The actual limit, in the case of defence expenditure, however , is the amount for which appropriation is sought for defence purposes in the Appropriation Bill (No. 1) 1983-84-some $5 billion-and any subsequent moneys for defence purposes that may be approved in subsequent Appropriation Acts. The effective limit is likely to be significantly less than these amounts as defence expenditures cannot be charged to Loan Fund until the legislation I am introducing is enacted. The legal limit for borrowing for non-defence purposes is determined by the level of borrowing authority approved by the Loan Council. Together, it is estimated that these limits will be sufficient to enable the financing of the Budget deficit. I commend the Bill to the House.

Debate (on motion by Mr Sinclair) adjourned.


Bill presented by Mr Hurford, and read a first time.