Federal Financial Relations (General Purpose Financial Assistance) Determination No. 12 (March 2010)

Overview

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 12, enacted in 2010, provides a legislative framework for the administration of general purpose financial assistance under the Federal Financial Relations Act 2009. This Act was introduced to address the need for a robust and transparent system of federal financial relations between the Commonwealth and the States, facilitating the on-going provision of financial support to the States for service delivery efforts. The objective of this legislation, as outlined in the Intergovernmental Agreement on Federal Financial Relations, is to improve collaboration on policy development and service delivery, and to support the implementation of economic and social reforms across key sectors. The determinations made by the Minister under this Act are legislative instruments that will be registered on the Federal Register of Legislative Instruments, enhancing transparency, but they are exempt from the disallowance provisions to ensure that the Minister can meet the obligations set out in the Intergovernmental Agreement.

Scope and Application

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 12 applies to the Minister for Finance in relation to the provision of general purpose financial assistance to the States as outlined under the Federal Financial Relations Act 2009. This Act, which commenced on 1 January 2009, implements the payment provisions of the Intergovernmental Agreement on Federal Financial Relations, providing a framework for ongoing financial support to states through various forms of financial assistance, including GST payments and National Specific Purpose Payments. The determination clarifies that payments made by the Minister under the Act are legislative instruments and will be registered on the Federal Register of Legislative Instruments, but these determinations are exempt from the disallowance provisions, allowing the Minister to meet the obligations specified under the Intergovernmental Agreement. The geographic and jurisdictional reach of this Act is national, impacting all states and territories within Australia.

Key Provisions

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 12 (March 2010) under the Federal Financial Relations Act 2009 outlines the parameters for the distribution of general purpose financial assistance to the states. Section 9(1) of the Act empowers the Minister to credit amounts to the COAG Reform Fund for the purpose of providing this assistance, which is intended to support states' service delivery efforts without specific restrictions on how the funds can be used. This fund is established under the COAG Reform Fund Act 2008 and operates as a Special Account as defined by the Financial Management and Accountability Act 1997. The Act imposes specific obligations on the Minister, who is required to make payments of general purpose financial assistance in a prescribed manner as stipulated in the Intergovernmental Agreement. To ensure that these obligations can be met without undue administrative burdens, the determinations made by the Minister regarding the allocation of funds are legislative instruments that are registered on the Federal Register of Legislative Instruments. Importantly, these determinations are exempt from the disallowance provisions outlined in the Legislative Instruments Act 2003, thereby allowing the Minister to fulfil their commitment under the Intergovernmental Agreement without the risk of their actions being overturned by disallowance. Breaching the obligations outlined in the Act could have significant consequences. Although the Explanatory Statement does not explicitly detail the penalties for non-compliance, it is reasonable to infer that breaches of the Act could result in legal or administrative consequences. Given the nature of the Intergovernmental Agreement, non-compliance might lead to disputes between the Commonwealth and the states, potentially impacting the flow of essential funding and affecting public services. While specific penalties are not mentioned, the seriousness of these obligations implies that significant repercussions could follow from any failure to adhere to the terms of the Act.