Financial Management Act 1994

Version No. 061

Financial Management Act 1994

No. 18 of 1994

Version incorporating amendments as at 1 January 2009

table of provisions

SectionPage

Part 1—Preliminary

1Purposes

2Commencement

3Definitions

4Act binds the Crown

5Relevant Minister

6Declaration of financial year

7Delegation

8Directions

Part 2—The Consolidated Fund

9The Consolidated Fund

10Appropriation of Commonwealth grants etc.

11Liability under guarantees

12Loans from Consolidated Fund

Part 3—Public Ledger and Public Account

13Public ledger

14Public Account

15Accounts of departments

16Receipt of public money

17How money is to be issued

18Investment of money in Public Account

Part 4—The Trust Fund

19The Trust Fund

20Deposits in Trust Fund

21Investment of money in Trust Account

22Expenditure of money in Trust Fund

23Departmental Working Accounts

Part 5—Financial Responsibility

Division 1—Introduction

23ADefinitions

23BApplication of Part

Division 2—Principles of sound financial management

23CGovernment to operate in accordance with principles of
sound financial management

23DPrinciples of sound financial management

Division 3—Financial policy objectives and strategies statements

23EFinancial policy objectives and strategies statement

23FPurpose of statement

23GContent of statement

Division 4—Estimated financial statements and budget update

23HEstimated financial statements

23IPurpose of estimated financial statements

23JContent of estimated financial statements

23KAccompanying statement

23LBudget update

23MPurpose of budget update

23NContent of budget update

Division 5—Disclosure of financial results

24Annual financial report

25Mid-year report

26Quarterly financial report

Division 6—Pre-election budget update

27Pre-election budget update

27APurpose of pre-election budget update

27BContents of pre-election budget update

27CRelease of pre-election budget update

Division 7—Release of reports, statements and updates

27DTransmission of documents to Parliament

27DAPublication of documents protected

27ERelease of estimated financial statements and budget
financial policy objectives and strategies statement

27FRepealed35

Part 6—Budget Management

28Appropriation for borrowing against future appropriation

29Appropriation of certain revenue and asset proceeds

30Transfer between items of departmental appropriation

31Transfer between items of Parliamentary appropriation

32Unused appropriation

33Appropriation to meet certain obligations

34Reduction in amount applied to meet future payments

35Temporary advances

36Temporary advances to authorities

37Issue of money out of Public Account

38Application of money in Public Account to meet
appropriations

39Arrangements for temporary advances

40Annual budget estimates

Part 6A—Indemnities

40ADefinitions

40BProvisions of this Part in addition to all other powers

40CIndemnity for directors

40DIndemnity for statutory authorities and State companies

40EIndemnity for owner of goods

40FCharge for indemnities

40GConfirmation of certain indemnities

40HAppropriation

Part 6B—Guarantee Charge

40IDefinitions

40JApplication of Part

40KGuarantee charge

40LInformation to be supplied

Part 6C—Financial Accommodation Levy

40MLeviable authority

40NFinancial accommodation levy

40OLeviable authority not liable to pay guarantee charge

Part 7—Accountability and Reporting

41Repealed

42Accountable officer

43Chief finance and accounting officer and other persons

44Accounts to be kept

44AAccountable officer of public body must provide financial information

44BAsset registers and risk management strategies

45Report of operations and financial statements to be prepared

46Tabling requirements

47Minister may vary reporting requirements

48Report of operations

49Financial statements

50Information

51Relevant Minister may require additional information

52Minister may direct public body to submit financial
statements

53Composite reports

53AAnnual reports of State-owned corporations and other bodies

54Part to prevail

Part 7A—Supply Management

54AEstablishment of Victorian Government Purchasing Board

54BFunctions of Board

54CPowers of Board

54DMembership of Board and terms of office

54EPayment of members

54FProcedure of Board

54GValidity of Board decisions

54HMembers' pecuniary interests

54IImproper use of information

54JDelegation

54KMinister's directions

54LSupply policies

54MAnnual report

Part 7B—Acquisition, Leasing and Licensing of Land and Premises

54NMinister may acquire land

54OMinister may lease land or premises for other Ministers

54PLicensing and leasing of surplus Crown land and buildings

Part 8—General

55Writing off

56Recovery of overpayments

57Liability in respect of loss or damage

58Unclaimed property

59Regulations

Part 9—Transitional and Consequential

60, 61Repealed82

62Transitional provisions

62AFurther transitional provisions

63References to receiver of revenue

64Saving of payments under Mint Act 1958

65, 66Repealed83

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SCHEDULES

SCHEDULE 1—Warrant

SCHEDULE 2—Repealed85

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ENDNOTES

1. General Information

2. Table of Amendments

3. Explanatory Details

Version No. 061

Financial Management Act 1994

No. 18 of 1994

Version incorporating amendments as at 1 January 2009

Financial Management Act 1994
No. 18 of 1994

The Parliament of Victoria enacts as follows:

Part 1—Preliminary

1Purposes

The purposes of this Act are—

(a)to improve financial administration of the public sector;

(b)to make better provision for the accountability of the public sector;

(c)to provide for annual reporting to the Parliament by departments and public sector bodies.

2Commencement

(1)Part 1 and sections 60 and 61 come into operation on the day on which this Act receives the Royal Assent.

(2)The remaining provisions of this Act come into operation on 1 July 1994.

3Definitions

In this Act—

S. 3 def. of accountable officer amended by No. 75/1994 s.5(1)(a)(i)(ii).

accountable officer, in relation to a department or public body, means the accountable officer for that department or public body as determined under section 42;

accounting recordsincludes—

(a)invoices, receipts, orders for the payment of money, bills of exchange, cheques, promissory notes, vouchers and other documents of prime entry; and

(b)such working papers and other documents as are necessary to explain the methods and calculations by which accounts are made up;

S. 3 def. of authorised deposit-taking institution inserted by No. 11/2001 s.3(Sch. item26.1).

authorised deposit-taking institution has the same meaning as in the Banking Act 1959 of the Commonwealth;

authoritymeans—

(a)a department; or

s. 3

(b)a person or body prescribed as an authority for the purposes of this Act;

S. 3 def. of Board inserted by No. 75/1994 s.5(1)(b).

Board means the Victorian Government Purchasing Board established by section54A;

S. 3 def. of business day insertedby No. 43/2004 s.4.

business day means a day other than a Saturday, a Sunday or a public holiday appointed under the Public Holidays Act 1993;

chief finance and accounting officer, in relation to an authority or public body, means the person designated as that officer for the purposes of section 43;

S. 3 def. of department substituted by No. 46/1998
s. 7(Sch. 1), amendedby No.108/2004 s.117(1) (Sch.3 item77.1).

department means—

(a)a department within the meaning of thePublic Administration Act 2004;

(b)an office specified in section 16(1) of that Act;

enactmentmeans a rule, regulation, by-law, order, Order in Council, proclamation or other instrument of a legislative character;

S. 3 def. of financial accommoda-tion
inserted by No. 43/1995 s.8.

financial accommodation has the same meaning as in the Borrowing and Investment Powers Act 1987;

S. 3 def. of financial year amended by No. 75/1994 s.5(1)(c).

financial yearmeans—

(a)in relation to a public body—

s. 3

(i)if the Minister has made a determination under section 6 with respect to the financial year of that public body, the period referred to in the determination;

(ii)if a period is determined by or under any other Act to be the financial year for that public body, that period;

(b)in any other case, the period of 12months ending at midnight on 30June;

S. 3 def. of public body amended by Nos 75/1994 s.5(1)(d)(i)(ii), 43/1995 s.7(1)(a).

public body means—

(a)a public statutory authority;

(b)a State business corporation or State body within the meaning of the State Owned Enterprises Act 1992;

(c)a body, office or trust body—

(i)established by or under an Act or enactment; or

(ii)established by the Governor in Council or a Minister—

and that is declared by the Minister, by notice published in the Government Gazette, to be a body or office to which Part 7 applies;

S. 3 def. of outputs inserted by No. 1/1998
s. 4(a).

outputs means goods produced or services provided by or on behalf of an authority or public body;

s. 3

S. 3 def. of services repealed by No. 1/1998
s. 4(b).

*****

S. 3 def. of the relevant Minister substituted by Nos 75/1994 s.5(1)(e), 43/1995 s.7(1)(b).

the relevant Minister means—

(a)in relation to a department, the Minister or Ministers for the time being responsible for any part of that department;

(b)in relation to a public body established by or under a provision of an Act or enactment, the Minister or Ministers for the time being administering that provision or enactment;

(c)in relation to any other public body, the Minister declared by Order under section 5 to be the relevant Minister;

(d)in relation to a body to which section 53A applies, the Minister declared by notice under section 53A(3) to be the relevant Minister in relation to the body for the purposes of section 53A;

trust bodymeans a body (including a trustee or trustees) who or which, or any office the holder of which, is charged with the control or management of any trust, fund, account or superannuation scheme which is established by an Act or enactment or by the Governor in Council or a Minister.

S. 4
repealed by No. 75/1994 s.5(2), news.4 inserted by No. 9/2000 s.3.

4Act binds the Crown

s. 4

This Act binds the Crown not only in right of Victoria but also, so far as the legislative power of the Parliament permits, the Crown in all its other capacities.

S. 5
amended by No. 43/1995 s.7(1)(c).

5Relevant Minister

The Governor in Council may, by Order, declare a Minister to be the relevant Minister in relation to a public body for the purposes of this Act.

S. 6 substituted by No. 75/1994 s.6,
amended by No. 100/1995 s.26(1).

6Declaration of financial year

(1)The Minister may determine in writing that a period, other than the period of 12 months ending at midnight on 30 June or the period determined by or under any other Act, is the financial year for a public body for the purposes of its first or final report of operations and financial statements under Part 7.

S. 6(2) inserted by No. 100/1995 s.26(2).

(2)Unless inconsistent with another Act, the Minister may, in relation to a public body or class of public bodies, in writing determine that a period, other than the period of 12 months ending at midnight on 30 June, is the financial year for that public body or public bodies of that class for the purposes of Part 7.

7Delegation

s. 7

The Minister may, by instrument, delegate to any person or class of persons employed in the administration of this Act any power of the Minister under this Act or the regulations, other than this power of delegation.

8Directions

S. 8(1) substituted by No. 26/2006 s.4(1).

(1)The Minister may give an authority, a public body, an accountable officer or a chief finance and accounting officer directions in writing for or with respect to any of the matters for or with respect to which regulations may be made under this Act.

Note

Section 59 sets out the matters for or with respect to which regulations may be made under this Act.

(2)Directions referred to in subsection (1) must not be inconsistent with this Act or the regulations.

S. 8(3) inserted by No. 26/2006 s.4(2).

(3)Directions—

(a)may be of a general or limited application;

(b)may differ according to differences in time, place or circumstances;

(c)may confer a discretionary authority or impose a duty on a specified person or class of person;

(d)may provide in a specified case or class of case for the exemption of persons or things or class of persons or things from any of the provisions of the directions, whether unconditionally or on specified conditions and either wholly or to such an extent as is specified.

S. 8(4) inserted by No. 26/2006 s.4(2).

(4)A direction may adopt, apply or incorporate the whole or any part of a statement of accounting standards or statement of accounting practice issued at any time before the direction is made by all or any of the persons or bodies referred to in section59(3).

S. 8(5) inserted by No. 26/2006 s.4(2).

(5)For the avoidance of doubt, the power to make directions under subsection (1) extends to directions with respect to money in a Trust Account in the Trust Fund that is established by or under another Act.

s. 8

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Part 2—The Consolidated Fund

9The Consolidated Fund

s. 9

(1)There shall be established and kept an account to be known as the Consolidated Fund.

(2)There shall be credited to the Consolidated Fund—

(a)all money forming part of the Consolidated Revenue under the Constitution Act 1975;

(b)all money—

(i)raised by or on behalf of or received by the State; or

(ii)which by or under an Act is payable to a person holding an office or place in the public service—

and which is not, by or under an Act, required or authorised to be paid to the Trust Fund, or an account in the Trust Fund, or to any other fund.

(3)If the purpose for which money must be applied is defined by the Commonwealth, the Minister may accept the money and credit it to a suitable account in the Trust Fund and, without any other authority than this Act, authorise the disbursement of the money for that purpose.

10Appropriation of Commonwealth grants etc.

If, under an Act of the Commonwealth or an arrangement between the Commonwealth and the State, money is or will be made available by the Commonwealth to the State by way of grant or otherwise, the Minister may, with approval of the Governor in Council, issue out of the Consolidated Fund such amount as is required to be expended in pursuance of the Act of the Commonwealth or the arrangement and the Consolidated Fund is to the necessary extent appropriated accordingly.

11Liability under guarantees

s. 11

If any borrowing or other contract or agreement or the performance of any other contract or agreement is by any Act declared to be guaranteed by the Government of Victoria, any sums required by the Minister or the Treasurer for fulfilling any such guarantee shall be paid out of the Consolidated Fund (which is to the necessary extent appropriated accordingly) and any sums received or recovered by the Minister or the Treasurer in respect of any sum so paid by the Minister or the Treasurer shall be paid into the Consolidated Fund.

12Loans from Consolidated Fund

Despite anything in any Act, if a payment is made by way of a loan from the Consolidated Fund, the Minister may determine from time to time the terms and conditions of the loan.

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Pt 3 (Heading) substituted by No. 1/1998
s. 5.

Part 3—Public Ledger and Public Account

S. 13 substituted by No. 1/1998
s. 6.

13Public ledger

s. 13

The Minister must ensure that a ledger is established and maintained to record—

(a)transactions on the Public Account; and

(b)expenses and obligations incurred that are to be met out of the Public Account; and

(c)such other transactions and such account balances as the Minister determines.

S. 14
amended by No. 11/2001 s.3(Sch. item26.2).

14Public Account

The Minister must open and maintain the Public Account with such authorised deposit-taking institution or institutions as the Minister determines.

15Accounts of departments

S. 15(1)
amended by No. 11/2001 s.3(Sch. item26.3).

(1)A department may, with the approval in writing of the Minister, and in accordance with such terms and conditions as the Minister determines, open and maintain an account with an authorised deposit-taking institution or institutions.

S. 15(2)
amended by No. 11/2001 s.3(Sch. item26.4).

(2)Unless the Minister otherwise determines in writing, an account opened under this section does not form part of the Public Account.

S. 15(3)
amended by No. 11/2001 s.3(Sch. item26.4).

(3)Money must not be withdrawn from an account opened under this section except in accordance with the regulations and directions.

S. 16 amended by No. 11/2001 s.3(Sch. item26.4).

16Receipt of public money

s. 16

A person who collects or receives public money must, in accordance with the regulations and directions, daily or at such intervals as the Minister determines, pay the money into the Public Account or an account opened under section 15.

17How money is to be issued

(1)Public money forming part of the Consolidated Fund may be drawn from the Public Account only in accordance with this section.

(2)The Minister, as often as occasion may require during a financial year, must—

(a)calculate the amount of public money likely to become due and payable out of the Public Account during that financial year; and

(b)must prepare an instrument in the form in Schedule 1 or to the like effect specifying that amount; and

(c)must sign the instrument and give it to the Auditor-General.

(3)The instrument, when countersigned by the Auditor-General and approved by the Governor, is the warrant enabling the Minister to order the drawing of money from the Public Account.

(4)Before countersigning the instrument, the Auditor-General must ascertain that the sums mentioned in it are then legally available and, after countersigning the instrument, the Auditor-General must return it to the Minister, who must submit it to the Governor for approval and signature, and then file the instrument.

18Investment of money in Public Account

s. 18

S. 18(1) amended by No. 104/1995 s.6(Sch. 1 item 8(a)).

(1)Any money standing to the credit of the Public Account may be invested by the Minister in any manner in which trust funds may be invested under the Trustee Act 1958.

(2)Except where otherwise expressly provided, interest received from the investment of any money under subsection (1) shall be credited to the Consolidated Fund.

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Part 4—The Trust Fund

19The Trust Fund

s. 19

(1)The Minister may establish Trust Accounts in the Trust Fund and define the purposes for which they are established.

(2)Subject to this section, Trust Accounts existing immediately before the commencement of this section (whether or not established by an Act) continue as Trust Accounts under this section.

(3)All money standing to the credit of an account which is a Trust Account for the purposes of this section is deemed to be money standing to the credit of the Trust Fund.

(4)The Minister may direct that a Trust Account be closed and, after all liabilities of the Trust Account have been met, the Trust Account must be closed accordingly.

S. 19(5) amended by No. 1/1998
s. 7.

(5)The Minister may direct that—

(a)any money standing to the credit of a Trust Account which is not required for the purposes of the Trust Account; and

(b)the balance of money standing to the credit of a Trust Account closed under this section—

be credited to another Trust Account or to the Consolidated Fund.

20Deposits in Trust Fund

The Minister may—

(a)accept deposits and credit the deposits to an appropriate Trust Account in the Trust Fund; and

(b)allow interest on the deposits at such rates as are from time to time prescribed.

S. 21 amended by No. 104/1995 s.6(Sch. 1 item 8(b)).

21Investment of money in Trust Account

s. 20

The Minister may invest money standing to the credit of a Trust Account in any manner in which trust funds may be invested under the Trustee Act 1958.

22Expenditure of money in Trust Fund

The Minister must not expend any money standing to the credit of a Trust Account in the Trust Fund except for the purposes of that Account or under the authority of this or another Act.

23Departmental Working Accounts

(1)The Minister may establish a Trust Account in the Trust Fund as a Working Account for each nominated department.

S. 23(2) amended by No. 1/1998
s. 8.

(2)There shall be paid into the Working Account of a nominated department amounts equal to amounts received from the provision of outputs by the nominated department to the extent, and on the conditions, agreed between the Minister administering this section and the Minister responsible for the nominated department.

(3)For the purposes of the payment of an amount of money into a Working Account under subsection(2)—

(a)an amount equal to that amount of money is deemed to have been appropriated to that Account; and

(b)the Minister may issue the amount out of the Consolidated Fund and apply it for the purpose of that Account.

S. 23(4) amended by No. 1/1998
s. 8.

(4)Money in the Working Account of a nominated department may be expended for the provision of such outputs by the nominated department, and on such conditions, as are agreed between the Minister administering this section and the Minister responsible for the nominated department.

(5)In this section,nominated department means a department, or part of a department, that—