House of Representatives

Second Reading Speech

The Financial Framework Legislation Amendment Bill (No. 2) 2013 would, if enacted, amend five Acts across three portfolios.

This Bill forms part of an ongoing program to address financial framework issues as they are identified and assists in ensuring that specific provisions in existing legislation remain clear and up-to-date.

Keeping the existing financial framework legislation up-to-date is also consistent with the reforms foreshadowed in the Government's proposed Commonwealth Financial Accountability Review.

First, the Bill would amend the Financial Management and Accountability Act 1997 to authorise the Commonwealth to form, or participate in forming, companies, as specified in the Financial Management and Accountability Regulations 1997.

The Bill would also amend the Financial Management and Accountability Regulations 1997 to specify the objects or activities of existing Commonwealth companies.

For the avoidance of doubt and to address potential constitutional issues raised by the High Court's decision in Williams v Commonwealth, the Bill would confirm the Commonwealth's existing involvement with companies. The proposed amendment would provide explicit legislative authority for the Commonwealth's involvement in companies.

The Bill would amend the Administrative Decisions (Judicial Review) Act 1977 (the ADJR Act) to provide for decisions made under the proposed amendment to the FMA Act, as I have outlined, not to be subject to administrative review.

As decisions about the formation of, and participation in, Commonwealth companies are not administrative decisions impacting on the interests of individuals, the Government considers that it would not be appropriate for such decisions to be subject to administrative review.

The second set of amendments in the Bill would establish a framework for dealing with overpayments within the Judges' Pensions Act 1968, the Remuneration Tribunal Act 1973, and the Social Security Act 1991 in relation to Australian Government Disaster Relief payments. These changes are technical in nature and would address instances where payments are made by the relevant agency from a special appropriation to recipients, that are not, in practice, consistent with the requirements or preconditions imposed by these Acts and risk breaching section 83 of the Constitution. The proposed amendments are similar in nature to the amendments delivered by the Financial Framework Legislation Amendment Act (No. 2) 2012.

Finally, the Bill would allow deferred tax asset relief to the Commonwealth Superannuation Corporation in relation to the transfer of assets from the Military Superannuation and Benefits Fund to the ARIA Investments Trust that occurred in May 2012. This is an operational amendment and follows the Government's decision to consolidate the trustees of the Commonwealth's main civilian and military superannuation schemes.

This Bill is, accordingly, another step to help ensure that specific areas of the Commonwealth's financial framework remain effective and up-to-date.