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

I move:

That these bills be now read a second time.

I seek leave to have the second reading speeches incorporated in Hansard.

Leave granted.

The speeches read as follows—

Supply Bill (No. 1) 2020-2021, together with Supply Bill (No. 2) 2020-2021 and Supply (Parliamentary Departments) Bill (No. 1) 2020-2021, seeks appropriations to facilitate the continuation of normal government business.

These bills are necessary to ensure the proper functioning of government services and the continuation of vital programs in an environment of global economic uncertainty resulting from the coronavirus pandemic. This economic uncertainty impacts the forecasts on which the federal budget depends. Consequently, the government has decided to reschedule this year's federal budget to 6 October 2020. This will also ensure that the 2020-21 budget can set out the path to economic recovery.

This delay of the budget does not, however, stand in the way of timely and comprehensive responses to the present health and economic challenges. This week the government has brought forward a wide-reaching package of legislation, including the expenditure, tax relief and streamlined regulatory measures, to support its coronavirus economic response.

Supply Bill (No. 1) 2020-2021 provides for appropriations for a proposed expenditure on the ordinary annual services of the government for the first seven months of 2021. This is slightly longer than the customary five-month contingency that has been provided in some recent supply bills. In the present uncertain circumstances, it is important that supply arrangements include enough contingency and ensure adequate time for parliamentary scrutiny of appropriation bills.

The bill seeks approval for appropriations from the consolidated revenue fund of just over $76.3 billion. The appropriations proposed in this bill are broadly based on seven-twelfths of the estimated 2020-21 annual appropriations. The 2020-21 estimates are largely the 2019-2020 base adjusted for economic and program specific parameters and the effect of decisions announced as part of MYEFO or included in the 2019-20 additional estimates appropriations bills, plus of course the COVID-19 related measures.

The bill must be passed in this session to ensure funding is available to all entities from 1 July 2020, thereby ensuring the continuity of program and service delivery. The seven-twelfths allocation are adjusted where necessary for programs or agencies that are expected to face additional pressures in the first seven months of the financial year.

I want to emphasise that this bill seeks provision only to fund government expenditure on an interim basis until the 2020-21 budget appropriation bills have passed. Therefore, no new measures for the 2020-21 budget are included in this bill. The bill also provides an advance to the finance minister, a provision of $16 billion, to provide the government with the capacity to allocate additional appropriations for urgent and unforeseen expenditure. This ensures sufficient appropriations are available to meet unforeseen costs, which may include responding to the need for increased medical services and to the need to provide capacity for further economic stimulus, should that be required, and supporting the ongoing business of government. In light of the size of this, it is proposed to institute additional transparency measures on its use. This will include a regular media release which reports and reconciles the use of the AFM provision. Details of the proposed expenditure are set out in the schedule to the bill, the EM and the various portfolio statements.

Supply Bill (No. 2), along with Supply Bill (No. 1) and the Supply (Parliamentary Departments) Bill (No. 1), seeks appropriations to facilitate the continuation of normal government business. Supply Bill (No. 2) 2020-2021 provides for appropriations that are not for the ordinary annual services of governments, such as for capital works and services, and for payments to states, territories and local governments for the first seven months of 2020-21. The bill seeks approval for appropriations from the Consolidated Revenue Fund of just under $6.7 billion. The appropriations proposed in this bill are broadly based on seven-twelfths of the estimated 2020-21 annual appropriations. The 2020-21 estimates are largely on the 2019-20 base adjusted for economic and program specific parameters and the effect of decisions in MYEFO or included in the additional estimates appropriation bills, plus the COVID-19 related measures. The seven-twelfths allocations are adjusted where necessary, where organisations are expected to face additional pressures in the first seven months of the year—for example, further capital funding for the national medical stockpile. The supply bills also take into account terminating programs.

The bill also establishes the debt limits for 2020-21 for general purpose financial assistance payments and national partnership payments. The debit limits in the bill reflect a full year of the estimated 2020-21 limits so that agreements with other governments can be established with certainty for the full year. Again, the bill must be passed in this session to ensure funding is available to all entities from 1 July 2020, ensuring the continuity of program and service delivery.

As with Supply Bill (No. 1), this bill seeks provision only to fund government expenditure on an interim basis until budget appropriation bills have been passed. Therefore, no new measures, I emphasise, for the 2020 budget are included in this bill either. The bill also provides an advance to the finance minister, a provision of $24 billion, to provide the government with the capacity to allocate additional appropriations for urgent and unforeseen expenditure. This ensures sufficient appropriations are available to meet unforeseen costs, which may include responding to the need for additional and more costly medical equipment driven by international competition and to the need to provide capacity for further economic stimulus, should that be required, and to support the ongoing business of government. In light of the size of the AFM, it is proposed to institute additional transparency measures on its use. This, again, will include a regular media release which reports and reconciles the use of the provision. Again, details of the proposed expenditure are set out in the schedule to the bill, the EM and the various portfolio statements.

Finally, the Supply (Parliamentary Departments) Bill (No. 1) 2020-2021 provides appropriations for the first seven months of 2020-21 for the operations of the Department of the Senate, the Department of the House of Representatives, the Department of Parliamentary Services and the Parliamentary Budget Office. This bill seeks approval for appropriations from the Consolidated Revenue Fund of just over $150 million. The appropriations proposed in this bill are broadly based on seven-twelfths of the estimated 2020-21 annual appropriations, which are largely the 2019-20 base adjusted for economic and program specific parameters. The bill must be passed in this session to ensure funding is available to these departments from 1 July 2020, thereby ensuring the continuity of our parliament's operations.

As with the other supply bills, I want to emphasise that this bill seeks provision only to appropriate money to fund government expenditure on an interim basis until budget appropriations bills have been passed. Again, no measures for the 2020 budget are included in this bill. This arrangement, importantly, allows for Appropriation (Parliamentary Departments) Bill No. 1 2020-21 or a similar bill to be passed when parliament resumes sitting, if necessary. Again, details of the proposed expenditure are set out in the schedule to the bill, the EM and the various 2019-20 statements. I therefore commend the bills to the House.

Nick McKim (Tasmania, Australian Greens) Share this | Link to this | Hansard source

I won't hold up the chamber unnecessarily. I just place on the record that, as the Leader of the Greens, Adam Bandt, has said regularly and as we have said in this chamber today, we will take a constructive role in the response to what many members have described as an unprecedented situation and we will be supporting this legislation so that the machinery of government can continue in the event that, as in fact has happened, the budget is postponed and in the event that this parliament is not able to resume under its previously agreed sitting arrangements. So we'll be supporting these bills.

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

Thank you very much. I probably should quit while I'm ahead—when I've got consensus across the chamber, which is unique! Let me just place on the record my great appreciation in particular for the way Senator Gallagher as the shadow minister for finance has worked with me through those issues.

We are living in unbelievable times. I don't think that any of us would have expected to be dealing with legislation of this nature and with an Advance to the Minister of Finance of this size. These bills are necessary to ensure the proper functioning of government services and the continuation of vital programs in an environment of global economic uncertainty resulting from the coronavirus pandemic. This economic uncertainty impacts the forecasts on which the federal budget depends. Consequently, we have decided to reschedule this year's federal budget for 6 October 2020, which will ensure that the 2020-21 budget can set out the path to economic recovery. However, this delay to the budget does mean that we won't be able to pass appropriation bills for 2020-21 before the end of the financial year—and of course, as a number of senators have observed, there is a high degree of uncertainty about the timing of when we will next be able to meet, which is why we have discussed with the opposition—and we appreciate the support of the entire chamber, including Senator McKim—the proposal to increase the Advance to the Minister for Finance to $40 billion.

This is designed to give us the fiscal capacity to respond to urgent and currently unforeseeable requirements in circumstances when there is uncertainty about when the parliament will next be able to meet. It ensures we have sufficient appropriations available to meet unforeseen costs, which may include responding to the need for additional, more costly medical equipment and supplies, given the high international demand and the upward pressure on prices. It gives us the capacity to provide further support to our economy and to Australians, if and as required, and support the ongoing operations of our government, but also to, if required, make additional payments to state and territory governments to support, for example, their provision of healthcare services to Australians.

In light of the significant increase in the advance to the finance minister, the government has agreed to the additional transparency measures that Senator Gallagher mentioned. I will issue a media release each Friday where one or more determinations have been made in that week to allocate funding from that advance and I will also write to the shadow finance minister to seek her concurrence, of behalf of the opposition, prior to drawing any funding from an advance to the finance minister for any given proposed expenditure greater than $1 billion. With those few words, I commend these bills to the Senate.

Question agreed to.

Bills read a second time.