Federal Financial Relations (General Purpose Financial Assistance) Determination No. 14 (May 2010)

Overview

The Federal Financial Relations Act 2009 was enacted to implement the payment provisions of the Intergovernmental Agreement on Federal Financial Relations, providing a new framework for federal financial relations that commenced on 1 January 2009. This Act was introduced by the Commonwealth Government to address the need for a robust and transparent system of financial support for the states in their service delivery efforts. The Act provides for the Minister to credit amounts to the COAG Reform Fund for the purpose of offering general purpose financial assistance to the states in the form of general revenue assistance, other than GST revenue grants. This legislation was enacted by the Parliament of Australia and its policy objective is to facilitate collaboration on policy development and service delivery, as well as the implementation of economic and social reforms in areas of national importance. The Act aims to improve transparency by making the Minister's determinations in respect of general purpose financial assistance legislative instruments, which are registered on the Federal Register of Legislative Instruments. However, these determinations are exempt from disallowance provisions, allowing the Minister to meet the obligation under the Intergovernmental Agreement to make payments of general purpose financial assistance in a prescribed manner. The determinations under the Act commence on the day they were made, ensuring a timely implementation of the financial support provided to the states.

Scope and Application

The Federal Financial Relations Act 2009 applies to the Commonwealth Government and the States, facilitating the implementation of the new federal financial framework that commenced on 1 January 2009. This Act provides for the provision of various financial supports including general purpose financial assistance, National Specific Purpose Payments, and National Partnership payments. These supports are intended to assist the States in their service delivery efforts across key sectors, and to facilitate or reward economic and social reforms of national importance. The Act mandates that the Minister credits amounts to the COAG Reform Fund for general purpose financial assistance, which is a special account established under the COAG Reform Fund Act 2008. Determinations made by the Minister regarding general purpose financial assistance are legislative instruments and will be registered on the Federal Register of Legislative Instruments, although they are exempt from disallowance provisions to ensure compliance with the Intergovernmental Agreement. The Act's provisions apply nationally across Australia, affecting federal and state entities involved in the financial support mechanisms outlined within the new federal financial framework.

Key Provisions

The Federal Financial Relations Act 2009 establishes the framework for general purpose financial assistance to the States. Under section 9, the Minister is empowered to credit amounts to the COAG Reform Fund for the purpose of providing general purpose financial assistance to the States. This assistance is intended to support the States in their service delivery efforts and is provided in the form of general revenue assistance, excluding GST revenue grants. The fund was established through the COAG Reform Fund Act 2008, which designated it as a Special Account under the Financial Management and Accountability Act 1997. The Act imposes specific obligations on the Minister to make payments of general purpose financial assistance in a prescribed manner, as mandated by the Intergovernmental Agreement on Federal Financial Relations. To enhance transparency, the Minister's determinations regarding general purpose financial assistance are legislative instruments and are required to be registered on the Federal Register of Legislative Instruments. Importantly, these determinations are exempt from disallowance provisions, ensuring that the Minister can fulfil the commitment to make payments as agreed. This exemption is crucial to uphold the obligations under the Intergovernmental Agreement. Failure to comply with the provisions of the Federal Financial Relations Act 2009 can lead to various consequences. While the Act does not explicitly detail offences or penalties for breaches, it is essential to note that non-compliance with the obligations to provide general purpose financial assistance could result in legal ramifications. These could include civil or criminal consequences, although the specific penalties are not stated within the Act itself. The overarching legal framework and other relevant laws would apply to address any breaches or non-compliance with the Act's provisions.