On 20 March 2009, the changes to the Financial Management and Accountability Act 1997 (Cth) (FMA Act) introduced by the Financial Framework Legislation Amendment Act 2008 (Cth) took effect. The amendments are aimed at simplifying the process for Commonwealth agencies to allow contractors to make payments on their behalf. Prior to the amendments, section 12 of the FMA Act only allowed the Minister for Finance to authorise arrangements for the receipt and custody of public money. Payment of public money could only be authorised under the FMA Act if agencies opened an official account under section 9 and issued an “outsider” with drawing rights.

The changes now allow a person, who is neither a Minister nor an official in an FMA Act agency, to make payments of public money, where the agreement or arrangement engaging them is authorised by Parliament or the Finance Minister (for example, property management services). This has the effect that agencies will no longer need to establish a separate official account under the FMA Act, thereby reducing the previous administrative issues involved with outsiders handling public money.

There have also been recent amendments to the Financial Management and Accountability Regulations 1997 (Cth) (FMA Regulations) to reflect the recent legislative changes and ministerial decisions relating to the establishment, abolition or renaming of certain prescribed agencies for the purposes of the FMA Act.

From 1 July 2009, the following agencies are now prescribed agencies under the FMA Regulations for the purposes of the FMA Act:

  • Australian Transport Safety Bureau, which was established as a statutory authority by the Transport Safety Investigation Amendment Act 2009 (Cth) whose function is to improve safety and public confidence in aviation, marine and rail transport,
  • Fair Work Australia, which will replace the Australian Industrial Relations Commission as the national workplace relations tribunal,
  • Office of the Fair Work Ombudsman, and
  • Australian Office of Financial Management, which is a specialised agency within the Treasury portfolio responsible for the management of Australian Government debt.

The amendments also amended the FMA Regulations to remove, as agencies under the FMA Act, the following:

  • Biosecurity Australia,
  • Dairy Adjustment Authority,
  • Office of the Workplace Ombudsman, and
  • Australian Fair Pay Commission Secretariat.