Federal Financial Relations (General purpose financial assistance) Determination No. 68 (November 2014)

Overview

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 68, made in November 2014, is an instrumental legislative instrument designed to operationalise the provisions of the Federal Financial Relations Act 2009. This determination was enacted by the Australian government to ensure the continued and transparent provision of general purpose financial assistance to the states under the Intergovernmental Agreement on Federal Financial Relations (IGA). The IGA, which came into effect on 1 January 2009, was established to foster collaboration between the Commonwealth and the States in the development and delivery of policies and services, particularly in areas of national significance. By providing ongoing financial support, the Act aims to assist states in their service delivery efforts, thereby supporting economic and social reforms. The determination ensures that payments of general purpose financial assistance are made in a prescribed manner, exempt from disallowance to uphold the obligations set out in the IGA, and is registered on the Federal Register of Legislative Instruments to enhance transparency.

Scope and Application

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 68, enacted under the Federal Financial Relations Act 2009, applies to the Commonwealth Minister for Finance in their capacity to provide financial assistance to the states. This assistance is part of the broader framework established by the Intergovernmental Agreement on Federal Financial Relations (IGA), which was signed by all jurisdictions in December 2008. The legislation is designed to facilitate the ongoing provision of general purpose financial assistance, including GST payments, to the states for their use in any purpose, as well as National Specific Purpose Payments and National Partnership payments. These payments are intended to support service delivery and reform efforts in key sectors, enhancing collaboration between the Commonwealth and the states. The provisions of this determination are implemented through legislative instruments and are registered on the Federal Register of Legislative Instruments, although they are exempt from disallowance provisions, allowing the Minister to meet the obligations under the IGA effectively. The determination clarifies that it applies nationally, aligning with the comprehensive framework set by the IGA.

Key Provisions

The Federal Financial Relations Act 2009, through the Federal Financial Relations (General Purpose Financial Assistance) Determination No. 68, establishes the framework for the Commonwealth's provision of general purpose financial assistance to the states. This assistance is to be used by the states for any purpose (s. 9). The determination specifies that the Minister is to credit amounts to the COAG Reform Fund for this purpose, ensuring a transparent and accountable process (s. 9(1)). The fund is a Special Account under the Financial Management and Accountability Act 1997, established by the COAG Reform Fund Act 2008 (s. 9(1)). The determinations made by the Minister in respect of these financial assistances are legislative instruments and must be registered on the Federal Register of Legislative Instruments (s. 9(2)). These determinations are not subject to disallowance, which allows the Minister to comply with the obligations under the Intergovernmental Agreement on Federal Financial Relations (IGA) (s. 9(3)). The obligations imposed by the Act on the parties involved, particularly the Minister, include making payments of general purpose financial assistance in a prescribed manner as set out in the IGA (s. 9). The Minister must ensure that these payments are made through the COAG Reform Fund and are adequately documented and transparent (s. 9(1)). The obligation to consult extensively with the states and ensure that the IGA is publicly available is also a critical aspect of the Minister's duties (s. 9). This extensive consultation process is intended to facilitate the collaborative development of policy and service delivery mechanisms, which are key objectives of the IGA. Breaches of the obligations under this Act can lead to various consequences. While the Act does not explicitly state penalties for non-compliance, breaches of the IGA's provisions could result in civil or criminal liabilities, depending on the nature and severity of the breach. For example, failure to make prescribed payments could be considered a breach of the IGA, potentially leading to legal actions or penalties as determined by the relevant courts. The Act ensures that the Minister's determinations are subject to transparency and registration requirements, which help to mitigate the risk of non-compliance (s. 9(2), 9(3)). The maximum penalties for breaches are not specified in the Act but would be determined in the context of any resulting civil or criminal proceedings.