Mathias Cormann (WA, Liberal Party, Vice-President of the Executive Council) Share this | Hansard source

First, let me make a slight correction in terms of when the fund is available. Part of the problem is that this financial year it was not yet available. Under the supply acts that we legislated last time, the advance of the finance minister to the tune of $40 billion was becoming available from 1 July 2020, and clearly the urgency and emergency is with us now. We believe, and we are proposing to the parliament—and we're very appreciative of the support from the opposition, and, as I understand from what you've just indicated, from the Australian Greens—that it is prudent for the government to be able to have access to this fund, this larger fund, earlier. We're not adding to the fund. We're just making it available, essentially, from royal assent for the remainder of this financial year. Then the appropriations acts for 2019-20 will lapse and then the supply acts 2020-21 will kick in. Whatever amount is spent out of appropriation acts 5 and 6 for 2019-20 will be deducted from the fund that is legislated in the supply act 2020-21. That's the first bit.

In terms of the circumstances in which this advance to the finance minister can be spent, this is a longstanding arrangement in our appropriations act. In fact, in the Westminster system it's been in place for hundreds of years as a prudent management tool to deal with urgent and unforeseen items of expenditure. There are established rules in relation to all of this, and there are established accountability requirements. As finance minister, I've got to report to the parliament and to the Senate on the use of the advance. The Auditor-General reviews the report that is prepared on the use of the advance on an annual basis. But in the context of this particular fund, given it's got a larger size, we have agreed to some additional transparency measures in our engagement with the opposition. I've made a commitment that every week, when a determination has been made under the advance to the finance minister, I would issue a statement explaining what funding has been allocated and for what purpose. You will have seen that I issued such a statement last Friday when we committed $800 million to the Department of Health for the purchase of more masks and other personal protective equipment for our health workers.

Right now I can't foresee what is unforeseeable. The reason we have this fund in place is to deal with unforeseen requirements in the context of the crisis that we're dealing with. The cost of medical equipment and personal protective equipment is higher than it has been in the past. The competition globally is more intense, and the demand domestically in Australia is higher than it usually is. So we do expect that there will be more calls on that fund in that context. I should also say that, if there is any expenditure item that goes above $1 billion, then I would seek the concurrence of the opposition for that payment through the shadow minister for finance. So there is that additional check and balance in there as well; it's not just a matter of me running off.

In terms of the decisions underpinning the allocation of funding, the normal processes of government would apply; I can't just make a decision myself to incur expenditure. The decision to incur expenditure is going to be a decision by government through the normal processes, subject to the authority of the Prime Minister and, as applicable, to the decisions of the Expenditure Review Committee and the like. But, ultimately, I have the fiscal capacity to allocate funding to these urgent and unforeseen needs. I hope that answers your question.