Federal Financial Relations (General purpose financial assistance) Determination No. 72 (March 2015)

Overview

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 72, issued in March 2015 under the Federal Financial Relations Act 2009, aims to facilitate the ongoing provision of financial support to the states for their service delivery efforts. This determination was enacted by the Minister to align with the Intergovernmental Agreement on Federal Financial Relations, which outlines the framework for collaboration and the distribution of general purpose financial assistance. This assistance is intended to be used by the states for any purpose, thereby enhancing their capacity to deliver services and implement reforms. The enactment body, the Commonwealth, committed to this support through the Intergovernmental Agreement, which was agreed upon in December 2008 and signed by all jurisdictions. The primary objective is to ensure ongoing financial collaboration between the federal government and the states, enhancing transparency and facilitating the efficient implementation of national reforms and services.

Scope and Application

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 72, made in March 2015 under the Federal Financial Relations Act 2009, pertains to the ongoing provision of general purpose financial assistance to the states by the Commonwealth. This form of assistance is intended to support the states' service delivery efforts and is separate from GST revenue grants, which are provided through the COAG Reform Fund as stipulated in the COAG Reform Fund Act 2008. The determination outlines that these financial assistance payments are to be made in accordance with the Intergovernmental Agreement on Federal Financial Relations, which was signed by all jurisdictions in December 2008 and facilitates collaboration on policy development and service delivery across national sectors. The determinations made by the Minister in respect of this financial assistance are legislative instruments that will be registered on the Federal Register of Legislative Instruments but are exempt from disallowance provisions, ensuring that the Minister can meet their obligations under the IGA. The scope of the determination is national, applying across all Australian states and territories, with the specific amounts and conditions of assistance being determined through subordinate instruments as required.

Key Provisions

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 72 (March 2015) outlines the key provisions of the Federal Financial Relations Act 2009 concerning general purpose financial assistance. Under this Act, the Minister is required to credit amounts to the COAG Reform Fund for the purpose of providing general purpose financial assistance to the States (section 9). This assistance, which includes general revenue assistance other than GST revenue grants, is intended to support the States’ service delivery efforts. The obligations imposed by the Act on the parties it governs are significant. The Minister has a mandated obligation under the Intergovernmental Agreement on Federal Financial Relations (IGA) to make payments of general purpose financial assistance in a prescribed manner. To facilitate this, the Minister’s determinations regarding these payments are legislative instruments and are registered on the Federal Register of Legislative Instruments (section 9(1)). However, these determinations are exempt from the disallowance provisions, ensuring that the Minister can meet the obligation to provide the necessary financial support to the States without hindrance. The Act also ensures transparency and accountability in the financial assistance process. By making the Minister’s determinations legislative instruments, it clarifies that these determinations would not otherwise be subject to disallowance under section 5 of the Legislative Instruments Act 2003. This exemption is crucial to allow the Minister to comply with the obligations set out in the IGA. Additionally, the COAG Reform Fund Act 2008 specifies that the COAG Reform Fund is a Special Account for the purposes of the Financial Management and Accountability Act 1997, further ensuring that the fund is managed in accordance with stringent financial management standards. In terms of offences and penalties, the Act does not explicitly detail specific offences or penalties for breaches of the provisions related to general purpose financial assistance. However, the nature of the Act and its alignment with the broader framework of federal financial relations suggests that any significant non-compliance could lead to legal consequences. Given the critical role of the Minister in ensuring the provision of financial assistance to the States, breaches could potentially result in legal actions aimed at enforcing compliance and rectifying any financial discrepancies. While the Act does not specify maximum penalties, the implications of failing to meet the obligations under the IGA could be substantial, both legally and in terms of the impact on federal-state relations.