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Victorian Public Sector Operating Manual on Machinery of Government Changes October 2016

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Victorian Public Sector Operating Manual on Machinery of Government Changes October 2016 Victorian public sector operating manual on machinery of government changes October 2016 The Secretary Department of Treasury and Finance 1 Treasury Place Melbourne Victoria 3002 Australia Telephone: +61 3 9651 5111 Facsimile: +61 3 9651 2062 dtf.vic.gov.au Authorised by the Victorian Government 1 Treasury Place, Melbourne, 3002 © State of Victoria 2016 You are free to re-use this work under a Creative Commons Attribution 4.0 licence, provided you credit the State of Victoria (Department of Treasury and Finance) as author, indicate if changes were made and comply with the other licence terms. The licence does not apply to any branding, including Government logos. Copyright queries may be directed to [email protected] ISBN 978-1-922222-98-5 Published October 2016 If you would like to receive this publication in an accessible format please email [email protected] This document is also available in Word and PDF format at dtf.vic.gov.au Introduction This manual provides a comprehensive source of guidance to assist departments in implementing machinery of government (MoG) changes. The guidance relates primarily to transfers of responsibilities and people between Victorian government departments under the Administrative Arrangements Act 1983, the Public Administration Act 2004 and the Financial Management Act 1994. However, the guidance also covers changes in portfolio responsibilities for non-departmental entities including the related impacts on the relationship between a relevant department and a government-controlled agency, and on the accounting for the investment in that entity regardless of whether or not the agency is directly involved in the transfer of departmental functions. While it is not practical to cover in detail every matter that departments and agencies might encounter during MoG changes, this manual provides: • an overview of the legislation that governs MoG processes; • principles and approaches for planning and implementing MoG changes, including indicative timeframes for key events; • protocols for resolving issues such as the transfer of resources; • guidance on financial management and people management; • applicable accounting standards and ministerial directions; and • advice on managing customer and stakeholder relations, physical relocations, information, records, data and taxation. Where possible, sample documents have been provided to assist departments in the planning and execution of what can be complex movements of functions and responsibilities between departments and their portfolio agencies. In the main, they have been developed by departments which have already been through MoG processes themselves, so generally speaking, these documents have already been ‘road tested’. Applicable legislative and policy framework Legislation The following key legislation are relevant to MoG changes. • Public Administration Act 2004 (PAA); • Administrative Arrangements Act 1983 (AAA); and • Financial Management Act 1994 (FMA). Other Victorian legislation may also be relevant, including: • Privacy and Data Protection Act 2014; • Public Records Act 1973; • Freedom of Information Act 1982; and • Constitution Act 1975. Page i Reporting The Budget and Finance Division of the Department of Treasury and Finance (DTF) issues specific guidance to departments in relation to MoG changes where they impact on the development and management of the annual budget and, where necessary, to specify any additional financial reporting requirements. The details and specifics of each guide will depend on the timing and complexities of a MoG change. Where relevant, the information contained in the previously-issued guidance has been incorporated into this manual. Certain mandatory accounting and reporting requirements related to MoG changes are also included in the Financial Reporting Directions (FRD) (issued by the Minister for Finance under the FMA): • FRD 119A Transfers through contributed capital together with FRD 103F Non-current physical assets, require that changes of ownership of output and assets, with limited exceptions, to be accounted for as a contribution by owners by the transferee, and a distribution to owners by the transferor. • FRD 117 Contributions of existing non-financial assets to third parties sets out the requirement to transfer non-financial assets to third parties. • In addition, attention is drawn to the requirements of FRD 21B Disclosures of responsible persons, Executive Officers and other personnel (contractors with significant management responsibilities) in the Financial Report. The requirements of these FRDs are detailed in chapter 6. The Standing Directions of the Minister for Finance 2016 and the associated mandatory instructions and guidance issued by DTF are also referred to in parts of this manual and, together with the FRDs, are accessible through the DTF website: • Financial Reporting Directions – http://www.dtf.vic.gov.au/Publications/Government-Financial- Management-publications/Financial-Reporting-Policy/Financial-reporting-directions-and- guidance • Standing Directions of the Minister for Finance and supporting material issued by DTF – http://www.dtf.vic.gov.au/Government-Financial-Management/Standing-Directions-of-the- Minister-for-Finance/Standing-Directions-of-the-Minister-for-Finance-2016 • Budget and Financial Management Planning, Budgeting and Financial Reporting Frameworks – http://www.dtf.vic.gov.au/Government-Financial-Management/Planning-Budgeting-and- Financial-Reporting-Frameworks Responsibility for future updates to the manual This manual has been compiled and produced by the Budget and Finance Division of DTF in close collaboration with departmental Chief Financial Officers (CFOs). Future updates of the manual are similarly the responsibility of the Budget and Finance Division of DTF and departmental CFOs. Page ii Web information and contacts Department of the Premier and Cabinet • Office of the General Counsel and Governance Branch – http://www.dpc.vic.gov.au/index.php/policies/legal#MOG Department of Treasury and Finance • Portfolio Analysis teams in the Budget and Finance Division – http://www.dtf.vic.gov.au/Government-Financial-Management List of acronyms This table provides a list of acronyms commonly used in this document. Acronym Description AAA Administrative Arrangements Act 1983 AAO Administrative Arrangements Order ABN Australian business number CFO Chief Financial Officer DFS Departmental financial statements DPC Department of Premier and Cabinet DTF Department of Treasury and Finance FBT Fringe benefits tax FINSI Financial supplementary information FMA Financial Management Act 1994 FOI Freedom of Information FRD Financial Reporting Direction GST Goods and services tax ICT Information and communications technology IDC Inter-departmental committee LSL Long service leave MoG Machinery of government MOU Memorandum of Understanding PAA Public Administration Act 2004 PAYG Pay as you go PFC Public financial corporation PNFC Public non financial corporation SAU State Administration Unit SRIMS State Resource Information Management System SSP Shared Service Provider VAGO Victorian Auditor General’s Office VPS Victorian Public Service WoVG Whole of Victorian Government Page iii Contents Introduction ............................................................................................................. i Applicable legislative and policy framework ............................................................................... i Legislation ................................................................................................................................... i Reporting ..................................................................................................................................... ii Responsibility for future updates to the manual ............................................................................ ii Web information and contacts ..................................................................................................... iii List of acronyms ......................................................................................................................... iii Chapter 1: Legal framework and definitions ............................................................ 1 Key considerations .................................................................................................................... 1 Machinery of government .......................................................................................................... 2 Implementation of changes – where to look and what to check ................................................... 2 Timing of MoG changes – a critical consideration ..................................................................... 3 Legislative instruments .............................................................................................................. 4 General orders............................................................................................................................ 4 Public Administration Act 2004 orders......................................................................................... 5 Administrative Arrangements Orders .......................................................................................... 6 Annual Appropriation Act ............................................................................................................ 8 Special cases ............................................................................................................................
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