Federal Financial Relations (General Purpose Financial Assistance) Determination No.112 (29 June 2018)

Overview

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 112, made on 29 June 2018, provides a framework for the Commonwealth to allocate general purpose financial assistance to the states and territories under the Federal Financial Relations Act 2009. This legislation was introduced to address the need for a structured and collaborative approach to financial relations between the Commonwealth and the states, as established by the Intergovernmental Agreement on Federal Financial Relations. The determination is made by the Treasurer and is registered on the Federal Register of Legislation. One notable aspect of this determination is the exemption from the disallowance provisions of the Legislation Act 2003, ensuring that the Commonwealth's obligations under the IGA are fulfilled. This includes a specific one-off grant to the Northern Territory to offset the reduction in the Territory’s 2018-19 GST share. The determination aligns with the conditions set out in the Intergovernmental Agreement on Federal Financial Relations, which was extensively consulted on and agreed to by the Council of Australian Governments on 29 November 2008. The payments made under this determination support various policy areas at the discretion of each state, thereby generally promoting multiple human rights. The amounts allocated to each state are detailed in the determination, and the total cumulative payments for the 2017-18 financial year do not exceed the prescribed debit limit of $5 billion.

Scope and Application

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 112 applies to the allocation and distribution of general purpose financial assistance granted by the Commonwealth to the States and Territories as mandated by the Intergovernmental Agreement on Federal Financial Relations. This determination is instrumental in detailing the specific amounts to be credited to the Council of Australian Governments (COAG) Reform Fund for the purpose of distributing these grants, ensuring compliance with the requirements set out in the Intergovernmental Agreement. The determination delineates the scope and application of the financial assistance, ensuring that payments are made in a transparent and accountable manner, with the total amount not exceeding $5 billion for the 2017-18 financial year. This assistance is granted to various states, with specific amounts allocated to each, as detailed in the schedule of the determination. The application of this Act is national, extending across all states and territories of Australia, and is governed by the Federal Financial Relations Act 2009 and the COAG Reform Fund Act 2008. The Act operates within the framework of the Intergovernmental Agreement and relevant agreements, with payments made subject to written agreements between the Commonwealth and the States, as stipulated under the COAG Reform Fund Act. There are no specific exclusions or exemptions outlined in the determination, though the manner and use of the funds are subject to the agreements and terms specified in the legislation.

Key Provisions

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 112 primarily establishes the parameters and conditions under which general purpose financial assistance is to be granted by the Commonwealth to the States and Territories. Section 7(2) of the COAG Reform Fund Act 2008 mandates that the terms and conditions of such assistance are to be specified in a written agreement between the Commonwealth and the States, ensuring transparency and accountability in the process. Furthermore, section 9(3) of the Federal Financial Relations Act 2009 sets a debit limit of $5 billion for the COAG Reform Fund for the 2017-18 financial year, with specific allocations detailed in Table 1 of the determination. This funding is intended to provide general purpose financial assistance, including a one-off grant to the Northern Territory to offset the reduction in its 2018-19 GST share. The determination imposes several obligations on the parties involved. Firstly, the Commonwealth is obligated to credit the COAG Reform Fund with the specified amounts as determined, ensuring that the total does not exceed the prescribed debit limit. Secondly, the Commonwealth must ensure that the terms and conditions of the financial assistance are documented in a written agreement, as per section 7(2) of the COAG Reform Fund Act 2008. The States and Territories, in turn, must comply with these terms and conditions, using the assistance in accordance with the agreements. Violation of the terms and conditions stipulated in the determination can result in various consequences. While specific offences are not detailed in the provided text, breaches of the Federal Financial Relations Act 2009 or the COAG Reform Fund Act 2008 could lead to legal actions. The Commonwealth's obligation to make payments in a prescribed manner is fundamental, and failure to adhere to this could result in civil or administrative penalties. Additionally, the exemption from disallowance provisions of the Legislation Act 2003 ensures that the Commonwealth can meet its obligations without undue legislative interference. The maximum penalties for breaches are not explicitly stated in the provided text, but they would typically be governed by the relevant sections of the Federal Financial Relations Act 2009 and the COAG Reform Fund Act 2008.