Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia
Date: Friday, 3 April 2020
This week I made $800 million in additional funding available to support the Government’s response to the COVID-19 pandemic by using the Advance to the Finance Minister.
One determination, which was signed today, was made from the Advance which was appropriated by the Parliament in the Appropriation (Coronavirus Economic Response Package) Act (No.2) 2019-2020.
The determination was registered on the Federal Register of Legislative Instruments, together with an Explanatory Statement (these will be available on legislation.gov.au).
The determination provided $800 million to the Department of Health to fund the further procurement of masks and other emergency medical or emergency health equipment to deal with the impact of COVID-19 in Australia.
The funding requirement is urgent and was unforeseen in the context of the continued rapid spread of COVID-19 across the globe with possible supply shortages due to increasing international demand and domestic manufacturing capability.
In addition to the Advance to the Finance Minister determination made this week, total Advance determinations previously issued for the 2019-20 year are as follows:
- $100 million was issued under Appropriation Act (No. 2) 2019-20 to the Department of Health on 4 March to fund the procurement of masks and other emergency medical or emergency health equipment for the National Medical Stockpile as part of the Australian Health Sector Emergency Response Plan for Novel Coronavirus.
- $200 million was issued under Appropriation Act (No. 2) 2019-20 to the Department of Health on 9 March to fund the further procurement of masks and other emergency medical or emergency health equipment for the National Medical Stockpile as part of the Australian Health Sector Emergency Response Plan for Novel Coronavirus.
For background – About the AFM
The Advance to the Finance Minister (AFM) is a legislated funding source of last resort, enabling the withdrawal of money from the Consolidated Revenue Fund within broad purposes identified in the annual Appropriation Acts.
AFM proposals are assessed by the Minister for Finance against the requirements of appropriation legislation. Appropriation legislation enables the Finance Minister to allocate additional amounts for expenditure up to a limit for the year, when he is satisfied that there is an urgent need for expenditure, that is not provided for or insufficiently provided for, for instance because the need for additional expenditure was unforeseen at the time when previous appropriations legislation was prepared.
Determinations by the Minister for Finance to provide funding via an AFM are all non-disallowable.
Relevant agencies are responsible for ensuring each AFM amount is spent for the designated purposes. AFMs are sometimes not fully spent and undrawn amounts lapse at the end of the financial year.
In addition to publishing AFM determinations online as they are made, these instruments are tabled in both Houses of Parliament through their usual processes. The Australian National Audit Office also conducts an assurance review of the processes for allocating AFMs at the end of the financial year and their review will be reported to the Parliament in the “Report on Advances provided under Appropriation Acts for the Year Ended 30 June 2020”.