Federal Financial Relations (General Purpose Financial Assistance) Determination No. 29 (August 2011)

Overview

The Federal Financial Relations Act 2009 was enacted by the Commonwealth Parliament to implement the payment provisions of the Intergovernmental Agreement on Federal Financial Relations, which provides a framework for collaboration on policy development and service delivery among Australian states and territories. This Act specifically addresses the need for ongoing financial support for the states' service delivery efforts through various financial assistance mechanisms, including general purpose financial assistance, National Specific Purpose Payments, and National Partnership payments. The aim is to facilitate economic and social reforms in areas of national importance, ensuring that the states have the necessary resources to deliver key services and undertake significant reforms. The Act provides for the Minister to credit amounts to the COAG Reform Fund, which is established under the COAG Reform Fund Act 2008, for the purpose of providing general purpose financial assistance to the states. To enhance transparency, the Minister's determinations regarding these financial assistance payments are legislative instruments and are registered on the Federal Register of Legislative Instruments. Notably, these determinations are exempt from disallowance provisions, enabling the Minister to fulfill the obligation to make payments in a prescribed manner under the Intergovernmental Agreement. The Act came into effect on the date of its enactment, ensuring that the new federal financial framework could be implemented without delay.

Scope and Application

The Federal Financial Relations Act 2009 applies to the Minister for Finance and serves to implement the financial aspects of the Intergovernmental Agreement on Federal Financial Relations. It provides the legal framework for the ongoing provision of general purpose financial assistance, National Specific Purpose Payments, and National Partnership payments to the states. The Act applies to the Commonwealth and the states, and it extends to the entities and individuals involved in the distribution and utilisation of these payments. The geographic reach of the Act is national, encompassing all states and territories within Australia. It does not specify exclusions or thresholds, but the terms of the payments are defined by the Intergovernmental Agreement, which the Act enforces. Determinations made by the Minister under the Act are legislative instruments and are subject to registration on the Federal Register of Legislative Instruments. Notably, these determinations are exempt from disallowance, ensuring that the Minister can meet the obligations under the Intergovernmental Agreement without legislative interference. The Act commenced on 1 January 2009, aligning with the start date of the new federal financial framework.

Key Provisions

The Federal Financial Relations Act 2009 primarily facilitates the distribution of general purpose financial assistance to the states through the COAG Reform Fund (sections 9-10). The Minister is mandated to credit amounts to this fund, which is a Special Account under the Financial Management and Accountability Act 1997 (section 9). These funds are intended to support states in their service delivery efforts and are provided in the form of general revenue assistance, excluding GST revenue grants (section 9). The Act ensures that the Minister's determinations regarding these financial assistance payments are legislative instruments and must be registered on the Federal Register of Legislative Instruments (section 10). However, these determinations are exempt from the disallowance provisions, meaning they cannot be disallowed by either House of Parliament (section 10). This exemption is crucial for the Minister to comply with the obligations set out in the Intergovernmental Agreement on Federal Financial Relations. The obligations imposed by the Federal Financial Relations Act 2009 on the Minister include the timely and prescribed crediting of amounts to the COAG Reform Fund (section 9). The Act also mandates that the Minister's determinations regarding general purpose financial assistance be transparent and registered on the Federal Register of Legislative Instruments (section 10). The Minister's role is to ensure that the financial assistance is provided in accordance with the terms of the Intergovernmental Agreement, thereby supporting the states' service delivery efforts. Additionally, the Minister must ensure that the payments are made in a prescribed manner, as outlined in the Act and the Intergovernmental Agreement (section 9). The Federal Financial Relations Act 2009 does not explicitly detail offences, penalties, or civil/criminal consequences for breaches of its provisions. However, failure to comply with the Intergovernmental Agreement on Federal Financial Relations could potentially result in legal consequences under other related legislation or agreements. The Act focuses primarily on the procedural aspects of providing financial assistance and ensuring transparency and accountability in the distribution of funds. Any breaches of the Intergovernmental Agreement could lead to disputes or legal actions under the broader framework of federal financial relations in Australia. The Act itself serves as a foundational piece of legislation that supports the broader financial framework, but specific penalties or consequences for non-compliance would need to be sought in the related agreements or other legislative instruments.