Federal Financial Relations (General purpose financial assistance) Determination No. 73 (April 2015)

Overview

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 73, enacted in 2015, addresses the ongoing need for financial support for state service delivery efforts as outlined in the Intergovernmental Agreement on Federal Financial Relations. This agreement, which commenced on 1 January 2009, was implemented through the Federal Financial Relations Act 2009. The legislation aims to ensure that the Commonwealth provides general purpose financial assistance to the states, including ongoing GST payments, for any purpose, thereby facilitating collaboration and economic and social reforms in areas of national importance. This determination is designed to enhance transparency by making the Minister's decisions on general purpose financial assistance legislative instruments, which will be registered on the Federal Register of Legislative Instruments, although they will not be subject to disallowance. This approach ensures that the Minister can continue to meet the obligations set out in the Intergovernmental Agreement.

Scope and Application

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 73, 2015, pertains to the administration of general purpose financial assistance under the Federal Financial Relations Act 2009. This legislation applies to the Commonwealth Minister who is tasked with the responsibility of making payments to the States through the COAG Reform Fund, which was established under the COAG Reform Fund Act 2008. The Fund is designated as a Special Account for the purposes of the Financial Management and Accountability Act 1997, ensuring that the financial assistance provided to the States is managed with the necessary oversight and accountability. This assistance is intended for use by the States for any purpose, thereby providing them with the flexibility to address a broad range of needs within their jurisdictions. The Minister’s determinations regarding these financial assistance payments are legislative instruments and, as such, are registered on the Federal Register of Legislative Instruments, although they are exempt from disallowance provisions, allowing the Minister to meet the obligations set out in the Intergovernmental Agreement on Federal Financial Relations.

Key Provisions

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 73 (April 2015) under the Federal Financial Relations Act 2009 establishes the framework for the provision of general purpose financial assistance to the states. Section 9(1) of the Act mandates that the Minister credits amounts to the COAG Reform Fund for this purpose, ensuring these funds are used for general revenue assistance, excluding GST revenue grants. The COAG Reform Fund Act 2008 established the COAG Reform Fund as a Special Account under the Financial Management and Accountability Act 1997, providing a structured approach to financial management and accountability. Obligations under this Act primarily rest with the Minister, who must credit the specified amounts to the COAG Reform Fund in accordance with the Intergovernmental Agreement on Federal Financial Relations (IGA). The IGA, signed by all jurisdictions in December 2008, commits the Commonwealth to ongoing financial support for states' service delivery efforts, including general purpose financial assistance. To meet this obligation, the Minister has an exemption from the disallowance provisions, allowing flexibility in meeting the commitment without the risk of disallowance. The Act also outlines that determinations made by the Minister regarding general purpose financial assistance are legislative instruments, which are to be registered on the Federal Register of Legislative Instruments. However, these determinations are not subject to disallowance, ensuring the Minister can effectively manage the provision of financial assistance without legislative impediments. This clarity helps in maintaining the integrity and continuity of the financial assistance framework, facilitating smooth policy implementation and service delivery. In terms of breaches and consequences, the Act does not explicitly state specific offences or penalties for non-compliance with the provisions concerning general purpose financial assistance. However, the legislative framework suggests that adherence to the IGA and the proper use of funds are paramount. Non-compliance could potentially lead to administrative or political repercussions, as the IGA is a formal agreement among the Commonwealth and states, and any deviation might be addressed through diplomatic or political channels rather than through formal legal penalties.