Federal Financial Relations (General purpose financial assistance) Determination No. 60 (March 2014)

Overview

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 60, made in March 2014, was enacted to provide ongoing financial support for states' service delivery efforts in alignment with the Intergovernmental Agreement on Federal Financial Relations (IGA) of 2008. This agreement established a framework for collaboration and service delivery, facilitating economic and social reforms in areas of national importance. The Federal Financial Relations Act 2009 implements the payment provisions of the IGA, with this determination clarifying the Minister's role in crediting amounts to the COAG Reform Fund for general purpose financial assistance, ensuring transparency while exempting these determinations from disallowance provisions to meet the Minister's obligations under the IGA. This determination, made by the Minister, came into effect on the day it was issued.

Scope and Application

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 60, made under the Federal Financial Relations Act 2009, applies to the financial assistance provided to states in Australia by the Commonwealth government. This assistance includes general purpose financial assistance, which is intended to support the states in delivering services and implementing reforms, with the flexibility to use these funds for any purpose. The determination ensures that these payments are made in accordance with the Intergovernmental Agreement on Federal Financial Relations (IGA), which was signed in December 2008 and came into effect on 1 January 2009. The act applies to the Commonwealth government and all Australian states and territories, thereby ensuring a consistent approach to financial relations across the nation. Notably, the Minister’s determinations regarding general purpose financial assistance are legislative instruments and are registered on the Federal Register of Legislative Instruments, though they are exempt from disallowance to facilitate the efficient execution of the IGA obligations. This exemption allows the Minister to meet the commitment to make payments in a prescribed manner, ensuring that the financial support mechanisms operate smoothly and effectively.

Key Provisions

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 60, issued under the Federal Financial Relations Act 2009, sets out the framework for providing general purpose financial assistance to the states. According to section 9 of the Act, the Minister is required to credit amounts to the COAG Reform Fund for the purpose of providing this assistance, which is intended for any use by the states (section 9(1)). This fund was established under the COAG Reform Fund Act 2008 and is designated as a Special Account under the Financial Management and Accountability Act 1997. The legislative instruments created by the Minister's determinations in respect of this assistance are to be registered on the Federal Register of Legislative Instruments, but they will not be subject to disallowance (section 9(2)). This exemption from disallowance ensures that the Minister can fulfil the obligation under the Intergovernmental Agreement on Federal Financial Relations (IGA) to make payments in a prescribed manner. Under the IGA, the Commonwealth committed to providing ongoing financial support to the states through various forms of assistance, including general purpose financial assistance, National Specific Purpose Payments, and National Partnership payments. The general purpose financial assistance is intended to be used by the states for any purpose, providing them with flexibility in how they allocate these funds. The determination ensures that these payments are made in a transparent and accountable manner, with the legislative instruments being registered on the Federal Register of Legislative Instruments. The IGA itself was subject to extensive consultation with all states and territories before being signed in December 2008, and it is publicly available on the Council for Federal Financial Relations website. There is also ongoing consultation with the states regarding the arrangements for general revenue assistance. The obligations imposed by this determination on the relevant parties primarily revolve around the transparent and timely provision of general purpose financial assistance. The Minister is obligated to credit amounts to the COAG Reform Fund as per the determination, and these credits must be used to provide the specified financial assistance to the states (section 9(1)). The states, in turn, are expected to use these funds in accordance with the terms set out in the IGA and as specified in the determination. The determination also places an obligation on the Minister to ensure that the legislative instruments created are registered on the Federal Register of Legislative Instruments, maintaining transparency and accountability in the process. Any breach of the obligations set out in the determination could lead to civil or criminal consequences, although specific offences and penalties are not detailed in the explanatory statement. The determination itself is not subject to disallowance, which allows the Minister to meet the obligations under the IGA without interference. However, the overarching legislation, the Federal Financial Relations Act 2009, and the associated IGA may have provisions that address breaches and specify penalties. The primary focus of the determination is on ensuring that the general purpose financial assistance is provided in a transparent and accountable manner, with the legislative instruments being properly registered and available for public scrutiny.