Federal Financial Relations (General Purpose Financial Assistance) Determination No. 113 (July 2018)

Overview

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 113, made in July 2018, governs the distribution of general purpose financial assistance from the Commonwealth to the States and Territories in accordance with the Intergovernmental Agreement on Federal Financial Relations (IGA). This Determination was enacted to facilitate the implementation of the IGA, which was agreed upon by the Council of Australian Governments on 29 November 2008. The Federal Financial Relations Act 2009 mandates the crediting of funds to the COAG Reform Fund for such purposes, and the COAG Reform Fund Act 2008 establishes the Fund as a special account. The determination outlines the payment conditions and debit limits for these financial transfers, ensuring they comply with the IGA and do not exceed the annual limit of $5 billion. The payments are intended to support various policy areas and services across the States, and while the determination itself is exempt from disallowance provisions to ensure compliance with the Commonwealth's obligations under the IGA, it does not adversely impact any human rights due to the general nature of the assistance provided.

Scope and Application

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 113 applies to the Commonwealth Government, the States, and the Territories within the framework established by the Intergovernmental Agreement on Federal Financial Relations (IGA). This agreement, which was extensively consulted and agreed upon by the Council of Australian Governments (COAG) in 2008, governs the provision of general purpose financial assistance (GPFA) to the States. This assistance is credited to the COAG Reform Fund and subsequently debited for distribution to the States, with the specific terms and conditions set out in Schedule D to the IGA. The determination specifies the total debit limit for the 2018-19 financial year, which is $5 billion, and details the allocation of funds among the States as of July 2018, with the remaining limit standing at approximately $4.94 billion. Notably, the determination exempts itself from the disallowance provisions of the Legislation Act 2003 to ensure compliance with the Commonwealth's obligations under the IGA. The application of this Act is national in scope, covering all Australian states and territories, and it extends to the specific purposes outlined in the IGA, such as compensating Western Australia for lost royalty revenue and assisting the Australian Capital Territory with municipal costs.

Key Provisions

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 113 (July 2018) outlines the provisions for the Commonwealth to provide general purpose financial assistance to the States, as mandated by the Intergovernmental Agreement on Federal Financial Relations (IGA). Under section 7(2) of the COAG Reform Fund Act 2008, the terms and conditions of the financial assistance are stipulated in Schedule D of the IGA, which specifies the requirements and purposes of the assistance. The total amount credited to the COAG Reform Fund for grants in the 2018-19 financial year is capped at $5,000,000,000.00 as per subsection 9(3) of the Federal Financial Relations Act 2009. As of the determination date, the total cumulative general purpose financial assistance payments made were $61,094,701.53, well within the debit limit. The obligations imposed by this determination include the requirement that the Commonwealth credit the specified amounts to the COAG Reform Fund and make payments to the States in accordance with the terms and conditions outlined in Schedule D of the IGA. The States must comply with the payment conditions, including the requirement to use the funds for the purposes specified in the IGA. The determination also mandates that the Treasurer ensure the payments are made in a prescribed manner, which generally involves payments on the 21st of each month or the next working day if the 21st is not a working day. Extraordinary payments can be made if necessary, as per the IGA provisions. Breaches of the obligations under this determination could lead to civil or criminal consequences. Although the determination itself does not specify particular penalties, breaches of the IGA or the COAG Reform Fund Act 2008 could result in legal action. The legislation underpinning these agreements and the payments, such as the Federal Financial Relations Act 2009 and the COAG Reform Fund Act 2008, may contain provisions for penalties or sanctions for non-compliance. However, the determination itself does not explicitly outline specific penalties for non-compliance. The overarching legal framework would govern any enforcement actions or penalties applicable to breaches of the IGA or related acts.