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Loan Bill 1978
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PARLIAMENT OF AUSTRALIA DEPARTMENT OF THE PARLIAMENTARY LIBRARY
LOAN BILL 1978
Date Introduced: 16 August 1978
House: House of Representatives
Presented by: Hon. J. Howard, M.P., Treasurer
Short Digest of Bill
Purpose
To permit the Treasurer to borrow up to $2 ,000
( million during 1978-79 to meet the anticipated deficit in
the Consolidated Revenue Fund (CRF) and to appl y the borrowed funds to defence purposes.
Background
This Bi 11 authorizes borrowings for defence p u r po s e s so t h at ex pend i t u re on defence w h i ch wo u 1 d
otherwise be met from the CRF may instead be met from the Loan Fund. Because payments from CRF cannot exceed moneys available in it, this is the normal method of reducing
payments from CRF by charging to the Loan Fund some
expenditure normally met from CRF.
As borrowings under t his Bill are for defence
purposes, they wil 1 not require the approval of the
Australian Loan Council.
Th e esti ma ted CRF deficit is $1,903.5 million ( (compared with an actual deficit of $1,359m. last year), so
the amount of borrowings permitted by this Bi 11 prov ides just a sma ll margin to allow for possibl e unforeseen
developments during the year.
The overall prospective deficit for 1978-79 is
$2,813 million but part of this arises in the Loan Fund
rather than CRF.
See Second Reading Speech for further explanation.
Main Provisions
Clause 3 gives authority to the Treasurer to borrow amounts not exceeding $2,000 million in the aggregate . The borrowing must be in accordance with the Commonwealth Inscribed Stock Act 1911 or an Act authorizing the issue of Treasury Bills.
- 2 -
The effect of clauses 4 and 5 is that the moneys
borrowed must be spent on the expenses of borrowing or for the defence services for which expenditure is al ready authorized under the Supply Act {No. 1) 1978-79 or for which it will be authorized under later Appropriation Acts for this financial year. However, no more may be spent on those defence services than has actually been appropriated by
Parliament for those services; but this does not affect the expenditure of the 11 Advance to the Treasurer11 â¢
Expenditure, other than for the expenses of
borrowing, must be before the end of the current financial year.
22 August 1978
Finance, Industries, Trade & Development Group LEGISLATIVE RESEARCH SERVICE
