Page 2864 - Week 09 - Thursday, 18 August 2005
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that the Financial Management Act and relevant individual enabling acts regulate the governance of prescribed statutory authorities. For the purposes of the bill, prescribed territory authorities are classified into one of two main categories, namely, those with a governing board and those that do not have a governing board.
In order to provide a consistent governance framework to apply across a range of statutory authorities, the bill consolidates core provisions into the Financial Management Act that can be applied appropriately to prescribed statutory authorities. However, it will still be necessary for each enabling legislation to continue to establish the particular purpose of each statutory authority and contain any other legislative requirements specific to the particular statutory authority.
Core provisions that have been consolidated into the Financial Management Act include setting out the general roles and functions of the chair, deputy chair, governing board and chief executive officer; requiring statutory authorities to keep the government informed about any significant events impacting upon their operations; making clear the requirement for board members to act honestly and to exercise due care and diligence; setting out arrangements for dealing with conflicts of interest; requiring a statutory authority to ensure that no subsidiaries, if there are any, do anything that the authority does not itself have the power to do; enabling the government to notify statutory authorities of any general government policies that should be taken into consideration; providing a clear legislative basis for the removal of board members; and requiring ministerial directions to be in writing, and disclosed publicly. The bill contains a contemporary governance framework to improve the operational performance and accountability of various statutory authorities by removing existing legal uncertainties surrounding their roles and responsibilities.
The bill also contains the following significant areas of change to strengthen and modernise the ACT government’s financial framework: providing more flexible arrangements for the annual scrutiny of performance measures by the Auditor-General, as foreshadowed in the 2005-06 budget, with the announcement of the revised performance management framework; broadening the appropriation framework to include territory authorities and territory-owned corporations, including additional accountability requirements to support key appropriations, amendments that will allow the cessation of quasi-service purchasing arrangements that currently exist between departments and authorities and territory-owned corporations, reducing the level of complexity and administration in departments; establishing an appropriate approval process for overdrafts or credit facilities to territory authorities; implementing an initial financial reporting change relating to the AASB’s GAAP/GFS convergence project to harmonise government financial reporting practices; and refining the financial management responsibilities of chief executives of departments.
In conclusion, the amendments proposed in this bill are aimed at clarifying provisions within the act and promoting an efficient, effective and contemporary financial management and governance framework and supporting practices. I trust that members will support the bill. I commend this bill to the Assembly.
Debate (on motion by Mr Mulcahy) adjourned to next the sitting.
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