Opinion Number. 442

Subject

FINANCE WHETHER PROPER FOR ITEMS PAYABLE OUT OF TRUST ACCOUNT TO BE INCLUDED IN APPROPRIATION ACTS : SENATE'S POWER OF OMISSION OR AMENDMENT : NATURE OF TRUST ACCOUNTS

Author
Key Legislation

CONSTITUTION, s. 53 : AUDIT ACT 1901-1909. s. 62A

Date
Client
The Auditor-General

The Auditor-General has submitted the following case to me for opinion:

I have the honour to request the favour of your opinion upon the question raised in the accompanying correspondence as to the inclusion in Acts appropriating moneys from the Consolidated Revenue, of amounts which the Treasurer's Estimates of Expenditure (as passed by Parliament) clearly show are to be paid from Trust Funds.

The present practice results in appropriations from the Consolidated Revenue being made which it is not intended to charge to the Revenue, and moreover, the anomaly is created of appropriating in some instances, moneys to be paid to the Trust Fund, while appropriation is also made of the same moneys which are intended to be paid out of the Trust Fund.

For example, the Treasury Statement 'O', for 1909-1910, Department of the Treasury, Miscellaneous-Item 9, 'Payment into Trust Fund, Stamp Printing, £2,741' will, prop-erly, be included in an Act appropriating the Consolidated Revenue, while expenditure partly included in this grant will likewise be appropriated if the present practice is continued.

Will you kindly advise me whether, in your opinion, the procedure now followed is a correct one.

In my opinion, there is no legal objection to the procedure described, and the ques-tion is really one of convenience.

I understand that the practice of including in the Estimates amounts which are to be paid out of a Trust Account has been adopted for the purpose of giving information to Parliament of the details of the expenditure which is to be made, during the financial year, from the moneys standing to the credit of the account. It also gives to Parliament an opportunity of exercising a control over the expenditure payable out of the account.

After the Estimates have been passed in the House of Representatives, the details of the Estimates as passed are included in the Schedule to the Appropriation Bill.

As the Senate has power to suggest the omission or amendment of any item in the Appropriation Bill, the items, as passed by the House of Representatives, are included in the Bill, in order that the Senate may have an opportunity to make suggestions as to their omission or amendment.

It seems to me therefore that the practice is convenient, if not necessary, under the circumstances.

I do not think that the practice gives rise to any real anomaly. Trust Accounts are created for convenience, and the moneys standing to the credit of those accounts are the moneys of the Commonwealth. It is true that Parliament has given a general auth-ority to expend those moneys for the purposes for which the Trust Accounts were established, but that fact does not stand in the way of Parliament exercising control over the expenditure, if it thinks fit to do so. By specifically voting certain items to be paid out of a Trust Account, Parliament does, I think, exercise control of such expen-diture as regards the items, and the general authority should be read as being subject to the specific votes. In other words, the general authority is superseded as regards items which are specifically voted by the specific authority.(1)

[Vol. 9, p. 458]

(1) This opinion was published in Commonwealth of Australia,Parl.Papers 1912,Vol.II,p.1250