Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024

Administered by Department of the Treasury

Legislation au F2024L00545 In force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

Issued by authority of the Assistant Minister for Competition, Charities and Treasury

Federal Financial Relations Act 2009

Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024

Subsection 9(1) of the Federal Financial Relations Act 2009 (the FFR Act) provides that the Minister may determine amounts to be paid to the States, the Australian Capital Territory or the Northern Territory for the purpose of the Commonwealth making grants of general purpose financial assistance.

The purpose of the Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024 (the Determination) is to determine amounts of general purpose financial assistance to be paid to the States, the Australian Capital Territory or the Northern Territory.

The Intergovernmental Agreement on Federal Financial Relations (the IGA) provides a foundation for collaboration on policy development and service delivery between the Commonwealth and the States, the Australian Capital Territory and the Northern Territory. The IGA sets out the terms and conditions on which Commonwealth has agreed to make grants of general purpose financial assistance to the States, the Australian Capital Territory or the Northern Territory.

The Determination gives effect to the Commonwealth’s ongoing obligations under the IGA to make grants of general purpose financial assistance.

By way of background, legislative authority is required for the Commonwealth to spend money from the Consolidated Revenue Fund. The Public Governance, Performance and Accountability Act 2013 provides that, if another Act establishes a special account and identifies the purposes of the account, the Consolidated Revenue Fund is appropriated up to the balance of the account at any point in time for expenditure for the purposes of the account.

In this context, the COAG Reform Fund Act 2008 establishes the COAG Reform Fund, a special account, which has the purpose of making grants and financial assistance to States and Territories. The FFR Act requires the Minister, following the making of a determination, to credit funds he or she has determined to the COAG Reform Fund for the purpose of providing general purpose financial assistance to the States, the Australian Capital Territory or the Northern Territory.

Under subsection 9(3) of the FFR Act, the total amount credited to the COAG Reform Fund for the purpose of making a grant of general purpose financial assistance in a financial year must not exceed the debit limit determined for that year. The debit limit is set by the annual appropriation Acts. The Determination will not result in total determined amounts for the relevant financial year exceeding the debit limit.

The IGA was subject to extensive consultation with the States and Territories before it was agreed by the Council of Australian Governments on 29 November 2008. The IGA is publicly available on the Federal Financial Relations website. The Determination is minor and machinery in nature and was not subject to further consultation.

Details of the Determination are set out in Attachment A.

The Determination is a legislative instrument for the purposes of the Legislation Act 2003. In accordance with the FFR Act, the Determination is not subject to disallowance or sunsetting under the FFR Act and the Legislation Act 2003 on the grounds that the instrument is part of an intergovernmental scheme and gives effect to agreements between the Commonwealth and each of the States, the Australian Capital Territory and the Northern Territory. The instrument's operation is effectively mechanical in that it simply details an instalment of financial assistance to be provided to a State or Territory based on that State or Territory having satisfied the necessary agreed criteria. The instrument can only authorise financial assistance being paid to a State or Territory where it has been supported by a valid appropriation enacted by the Parliament, further the annual appropriation Bills also include annual debit limits for amounts that may be spent under the delegated general purpose financial assistance or national partnership payments under the FFR Act. The debit limits provide an effective mechanism to limit the expenditure of public money under the Determination and ensures that there is alternative Parliamentary scrutiny of such arrangements.

The Determination commenced on the day it was registered on the Federal Register of Legislation.

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

The instrument determines amounts of general purpose financial assistance to be paid to the States, the Australian Capital Territory or the Northern Territory.

Human rights implications

This Legislative Instrument does not engage any of the applicable rights or freedoms.

It is difficult to assess the human rights compatibility of the making of payments of general purpose financial assistance, as the amounts paid to each State or Territory can be used for any purpose. Generally, payments will promote multiple human rights by supporting service delivery in a range of policy areas, at the discretion of each State or Territory.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.

ATTACHMENT A

Details of the Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024

Section 1 – Name of the Determination

This section provides that the name of the Determination is the Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024 (the Determination).

Section 2 – Commencement

The Determination commenced on the day the instrument was registered on the Federal Register of Legislation.

Section 3 – Authority

The Determination is made under the Federal Financial Relations Act 2009 (the Act).

Section 4 – Definitions

This section provides definitions are that used in the Determination.

Section 5 – Determination of general purpose financial assistance

This section specifies amounts to be paid to each of the States, the Australian Capital Territory and the Northern Territory as grants of general purpose financial assistance.

In addition to the goods and services tax revenue grants provided to the States, the Australian Capital Territory and the Northern Territory as grants of general purpose financial assistance under Division 1 of Part 2 to the Act, the Commonwealth, by way of the Determination, also pays grants of general purpose financial assistance for the following:

•                 to compensate Western Australia for the loss of royalty revenue resulting from the removal in the 2008-09 Budget of the exemption of condensate from crude oil excise;

•                 to the Australian Capital Territory to:

–               assist in meeting the additional municipal costs which arise from Canberra's role as the national capital; and

–               compensate the Australian Capital Territory for additional costs resulting from the national capital planning influences on the provision of water and sewerage services;

•                 to Western Australia from royalties payable under the Offshore Petroleum (Royalty) Act 2006 in respect of the North West Shelf oil and gas project off the coast of Western Australia. The Commonwealth collects these royalties because it has jurisdiction over offshore areas. These royalties are shared between the Commonwealth (approximately one third) and Western Australia (approximately two thirds). These payment arrangements are in accordance with section 75 of the Offshore Petroleum and Greenhouse Gas Storage Act 2006; and

•                 to the Northern Territory in lieu of royalties on uranium mining due to the Commonwealth's ownership of uranium in the Ranger Project Area.

Overview

The Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024 was enacted to determine the amounts of general purpose financial assistance to be paid to the States, the Australian Capital Territory, and the Northern Territory. This Determination is based on the Federal Financial Relations Act 2009, which allows the Minister to make such payments as part of the Commonwealth's obligations under the Intergovernmental Agreement on Federal Financial Relations (IGA). The primary objective of this Determination is to ensure compliance with the IGA, which outlines the terms and conditions for the Commonwealth’s grants of general purpose financial assistance to the States and Territories. The instrument reflects the ongoing commitment of the Commonwealth to support service delivery and meet specific obligations agreed upon with the States and Territories, ensuring that the payments do not exceed the annual debit limits set by the appropriation Acts. The determination process was informed by extensive consultation during the development of the IGA, and the instrument itself is considered minor and machinery in nature, thus not subject to further consultation. This Determination is an essential component of the financial framework established by the IGA, facilitating the distribution of funds from the Consolidated Revenue Fund through the COAG Reform Fund, as stipulated under the COAG Reform Fund Act 2008. Additionally, the instrument has been assessed for compatibility with human rights, concluding that it does not engage any of the applicable rights or freedoms, and thus is compatible with the human rights and freedoms recognised or declared in the international instruments listed in the Human Rights (Parliamentary Scrutiny) Act 2011.

Scope and Application

The Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024 applies to the States, the Australian Capital Territory, and the Northern Territory, as it specifies the amounts of general purpose financial assistance to be paid to these entities by the Commonwealth government. The determination operates under the legislative authority provided by the Federal Financial Relations Act 2009, ensuring that the Commonwealth's obligations under the Intergovernmental Agreement on Federal Financial Relations are met. The specified payments are intended to compensate Western Australia for the loss of royalty revenue due to the removal of the condensate exemption from crude oil excise, assist the Australian Capital Territory in meeting additional municipal costs arising from its role as the national capital, and compensate the Australian Capital Territory for additional costs due to national capital planning influences on water and sewerage services. Additionally, it includes payments to Western Australia from royalties collected on the North West Shelf oil and gas project and to the Northern Territory in lieu of royalties on uranium mining due to the Commonwealth's ownership of uranium in the Ranger Project Area. The Determination is not subject to disallowance or sunsetting, and its operation is effectively mechanical, providing financial assistance to states and territories based on their compliance with pre-established criteria.

Key Provisions

The Federal Financial Relations (General Purpose Financial Assistance—2023-24 Payment No. 11) Determination 2024 primarily functions to specify the amounts of general purpose financial assistance (GPFA) that the Commonwealth is to pay to the States, the Australian Capital Territory, and the Northern Territory (sections 1, 2, 3, 4). This Determination is grounded in subsection 9(1) of the Federal Financial Relations Act 2009 (FFR Act), which empowers the Minister to determine the amounts of GPFA to be disbursed to these entities. The amounts are set out in section 5 of the Determination and are designed to fulfil the Commonwealth's commitments under the Intergovernmental Agreement on Federal Financial Relations (IGA). The IGA outlines the terms and conditions for the Commonwealth's provision of GPFA to support state and territory governments in delivering public services. The Determination imposes obligations on the Commonwealth to credit the specified GPFA amounts to the COAG Reform Fund, established under the COAG Reform Fund Act 2008 (section 4). It mandates that these credits must not exceed the debit limit determined for the financial year, as set out in the annual appropriation Acts (subsection 9(3) of the FFR Act). This ensures that the expenditure aligns with the approved budget and provides a measure of parliamentary oversight through the annual appropriation process. The Commonwealth must ensure that these funds are used strictly for the purposes of providing GPFA as agreed under the IGA. There are no explicit offences, penalties, or civil/criminal consequences detailed in the Determination for its breach. However, the Determination is underpinned by the legislative framework of the FFR Act and the Legislation Act 2003, which provide for the disallowance or sunsetting of legislative instruments. The Determination itself is not subject to these mechanisms because it is part of an intergovernmental scheme and gives effect to agreements between the Commonwealth and the States, the Australian Capital Territory, and the Northern Territory. The annual appropriation Bills also include annual debit limits for amounts that may be spent under the FFR Act, providing an additional layer of financial control and accountability.

Legal classification tags

Area of Law
Finance & Banking Law
Federalism & Intergovernmental Relations
Instrument
Determination
Concepts
Reporting & Disclosure Obligations
Regulatory Standards
Transitional Provisions

Interactions

Authorises

All Versions

Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.