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Legislative Assembly for the ACT: 2003 Week 13 Hansard (26 November) . . Page.. 4637 ..

MS TUCKER (continuing):

I commend this bill to the Assembly. An explanatory statement will be tabled in the next sitting week.

Debate (on motion by Mr Corbell ) adjourned to the next sitting.

Financial Management Amendment Bill 2003 (No 3)

Ms Dundas , pursuant to notice, presented the bill and its explanatory statement.

Title read by clerk.

MS DUNDAS (10.53): I move:

That this bill be agreed to in principle.

Section 18 of the Financial Management Act governs the use of the Treasurer's Advance. The bill I have presented today substantially amends section 18. These amendments are intended to clarify the circumstances in which the Treasurer's Advance may be used by limiting its use to situations where it is not possible to raise an appropriation bill because of the urgency of the required expenditure.

Although the government of the day has the right to draw up a proposed budget, we have appropriation bills because our democratic system is founded on the belief that the parliament is the body that should decide whether to approve the government's overall budget. The government already has substantial discretion to reallocate expenditure within a department or agency. However, if a government finds that it cannot meet spending requirements within an existing appropriation, it can raise supplementary appropriation bills to obtain additional funding.

The current wording of the Financial Management Act does not specify whether the Treasurer's Advance or a supplementary appropriation is the appropriate process to meet expenditure requirements not accounted for in the budget. Presently, where expenditure could not be reasonably foreseen and included in the first appropriation act, the expenditure can be funded using either process.

I believe that the Treasurer's Advance exists to provide emergency funding to cover unanticipated costs where there is insufficient money in the existing appropriation. However, I have gained the impression that treasurers and the Treasury tend to take the view that this money is like a treasurer's discretionary budget, to be spent on anything that pleases them without the imprimatur of the Assembly.

The current practice for the allocation of the Treasurer's Advance is outlined rather entertainingly on page 11 of the Public Accounts Committee report of September 2003 following a review of Auditor-General's Report No 7 of 2002. When members are considering this bill, I would encourage them to go back and look at that report, which was report No 6 of the Public Accounts Committee, to understand the angle from which this bill is coming and the debates that have already gone on about the use of the Treasurer's Advance.

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