Chris Pearce (Aston, Liberal Party, Parliamentary Secretary to the Treasurer) Share this | Hansard source

I thank members for their contributions to this debate, particularly the member for Blair, who has just demonstrated a very thorough knowledge and understanding of this bill. I thank him for his contribution. The Financial Framework Legislation Amendment Bill (No. 1) 2007 primarily amends division 3 of part 4 of the Financial Management and Accountability Act 1987, otherwise known as the FMA Act. That division consists of five sections, each relating to the appropriation authority. The bill also contains a small number of consequential amendments to the Auditor-General Act 1997 and the Legislative Instruments Act 2003, and clarifies another matter in the FMA Act in relation to delegations.

Significantly, the amendments will considerably strengthen parliamentary oversight capacity for the FMA Act to increase agency appropriations. Current arrangements under section 31, for example, require three separate sources of information in order to identify both the amount of an increase as well as the original source of the appropriation authority. Those three sources are the agency section 31 agreement, of which there are 80-plus, as well as the text of section 31 of the FMA Act and the annual appropriation act in question.

In addition to also being exempt from parliamentary scrutiny, these arrangements can vary widely from agency to agency. The revised arrangements in the form of a regulation to apply uniformly to all agencies will also be subject to parliamentary disallowance. The revised arrangements will also be restricted to departmental items. In addition to the increased oversight by parliament, officials themselves will have better scrutiny and control over the appropriations administered within their respective agencies. The new section 32A will eliminate the current scope for appropriations to be increased automatically by operation of law without officials necessarily even being aware that the increase has occurred. The revised arrangements will ensure that no increase to an agency’s appropriation will take place until a record has been made in the agency’s accounts and records. This considerably tightens agencies’ oversight of appropriations.

The amendments are evidence of the ongoing incremental improvements in the financial framework. This is the third financial framework legislation amendment bill, with financial framework amendment acts having been passed in both 2005 and 2006. Each has evidenced ongoing monitoring and review, showing that incremental improvements to the financial framework continue on an ongoing basis. While this area is relatively technical in its nature, it is an important part of financial management accountability that this government takes seriously. I commend the bill to the House.

Question agreed to.

Bill read a second time.

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