Constitution (Appropriation and Supply) Amendment Bill

Introduction and First Reading

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Justice Reform, Minister for Planning, Minister for Housing and Urban Development, Minister for Industrial Relations, Minister for Child Protection Reform) (15:38): Obtained leave and introduced a bill for an act to amend the Constitution Act 1934. Read a first time.

Second Reading

The Hon. J.R. RAU (Enfield—Deputy Premier, Attorney-General, Minister for Justice Reform, Minister for Planning, Minister for Housing and Urban Development, Minister for Industrial Relations, Minister for Child Protection Reform) (15:39): I move:

That this bill be now read a second time.

This bill makes changes to part 2, division 5 of the Constitution Act 1934 which relates to money bills. It introduces a new process for securing the passage of the annual Appropriation Bill and Supply Bill so that those bills will not need to be passed by the Legislative Council before being presented to the Governor for assent.

I seek leave to have the remainder of the second reading explanation inserted in Hansard without my reading it.

Leave granted.

In 1913, the current provisions of the Constitution Act relating to money Bills were inserted. Those provisions set out specific requirements regarding money Bills and money clauses, including that the Legislative Council cannot amend a money clause, but can suggest amendments.

The Constitution Act also contains specific provisions in relation to appropriation Bills. It draws a distinction between a money clause in an appropriation Bill that appropriates revenue or other public money for some purpose other than a previously authorised purpose, and a money clause in an appropriation Bill which appropriates revenue or other public money for a previously authorised purpose. It was intended, when the provisions were inserted, that the former category of money clauses would be able to be the subject of suggested amendment by the Legislative Council; the latter would not. In other words, the Constitution Act envisaged that the role of the Legislative Council in relation to money Bills that were for a previously authorised purpose was to be more limited, and that amendment (including suggested amendments) by the Legislative Council, would not be permitted.

In practice what has occurred is that, since at least 1981, the annual Appropriation Bill provides for appropriations both for previously authorised purposes, and for purposes not previously authorised, and the Legislative Council is able to suggest amendments to all aspects of the annual Appropriation Bill. The intention behind the provisions inserted into the Constitution Act in 1913 has not been realised.

As a result, the Legislative Council today has more power in relation to the annual Appropriation Bill than was originally intended. There is a risk that the Legislative Council could misuse that power and, for example, unacceptably delay the annual Appropriation Bill and, in doing so, disrupt the machinery of Government. This Bill removes that risk.

The Bill removes from the Constitution Act the current definitions of 'appropriation Bill' and 'previously authorised purpose' and deletes current section 63 of the Constitution Act. As already discussed, those provisions have not operated as originally intended and are to be replaced by the proposed new mechanism for dealing with annual Appropriation Bills and Supply Bills.

The Bill proposes to insert new section 63 into the Constitution Act to provide that if, in relation to either the annual Appropriation Bill or the Supply Bill, after transmission to the Legislative Council, the Legislative Council:

open-capture fails to pass the Bill within one month; or

open-capture rejects the Bill; or

open-capture passes the Bill with amendments to which the House of Assembly does not agree,

the annual Appropriation Bill or Supply Bill (as the case may be) will be taken to have passed both Houses of Parliament and will be presented to the Governor for assent.

So, in effect, the Legislative Council has one month to deal with the Annual Appropriation Bill or Supply Bill. If it does not, then the Bill will be presented to the Governor for assent without having passed the Legislative Council.

Proposed new section 63(2) provides that there can only be one annual Appropriation Bill and one Supply Bill in respect of a particular financial year.

Definitions of 'annual Appropriation Bill' and 'Supply Bill' will be in new section 63(3) of the Constitution Act. In South Australia, the annual Appropriation Bill authorises all appropriation for the financial year, other than some standing appropriations that are contained in specific legislation. It is intended that this will continue to be the case. The Bill defines 'annual Appropriation Bill' as a Bill that 'appropriates money from the Consolidated Account in respect of a particular financial year', and that deals only with the appropriation of such money. The Supply Bill is defined as a Bill that 'appropriates money from the Consolidated Account in respect of a particular financial year pending the enactment of the annual Appropriation Bill in respect of that year', and that deals only with such appropriation of such money.

Importantly, the definitions of annual Appropriation Bill and Supply Bill make clear that there can be no tacking of other matters on to those Bills. Annual Appropriation Bills and Supply Bills can only deal with appropriation from the Consolidated Account in respect of a particular financial year. This is an important safeguard, which is intended to prevent against any expansion of the content of an annual Appropriation or Supply Bill beyond what we would ordinarily expect to see in those Bills.

The commencement of the Bill is subject to the operation of the Referendum (Appropriation and Supply) Bill 2015, which provides for a referendum on the Bill to be conducted at the next general election of the House of Assembly.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

This clause is formal.

2—Commencement and operation

The measure will need to be submitted to a referendum under the proposed Referendum (Appropriation and Supply) Act 2015.

3—Amendment provisions

This clause is formal.

Part 2—Amendment of Constitution Act 1934

4—Amendment of section 60—Interpretation

This clause is consequential on the amendments relating to annual Bills for appropriation and supply.

5—Amendment of section 62—Power of Council as to money clauses

The repeal of section 62(3) is related to the operation of proposed section 63. The amendment to section 62(2) is consequential on the repeal of subsection (3).

6—Substitution of section 63

This clause sets out a new scheme with respect to annual Bills for appropriation and supply (which are defined as prescribed annual Bills). Essentially, the scheme provides that a prescribed annual Bill that has been passed by the House of Assembly will, if the Legislative Council fails to pass the Bill within 1 month, rejects it or passes the Bill with suggested amendments to which the House of Assembly does not agree, be deemed to have passed both Houses of Parliament and will be presented to the Governor for assent.

Key definitions are set out, including definitions of an annual Appropriation Bill and a Supply Bill.

Schedule 1—Transitional provision

1—Annual Bills for appropriation and supply

The new provisions relating to annual Bills for appropriation and supply will only apply in relation to Bills introduced into the Parliament after the commencement of this measure.

Debate adjourned on motion of Mr Gardner.