Federal Financial Relations (General purpose financial assistance) Determination No. 75 (June 2015)

Overview

The Federal Financial Relations (General Purpose Financial Assistance) Determination No. 75, enacted in 2015, was introduced to establish a clear framework for the provision of general purpose financial assistance to the States by the Commonwealth, as mandated under the Intergovernmental Agreement on Federal Financial Relations. This legislation aims to ensure ongoing financial support for the States' service delivery efforts, complementing the broader federal financial framework that commenced on 1 January 2009. The determination is intended to enhance transparency and facilitate the implementation of the payment provisions outlined in the Federal Financial Relations Act 2009, with the Minister's determinations regarding general purpose financial assistance being legislative instruments registered on the Federal Register of Legislative Instruments, though exempt from disallowance provisions to meet the Commonwealth's obligations under the Intergovernmental Agreement.

Scope and Application

The Federal Financial Relations (General purpose financial assistance) Determination No. 75 applies to the provision of general purpose financial assistance to the States in the form of general revenue assistance other than GST revenue grants. It clarifies that determinations made by the Minister under subsection 9(1) of the Federal Financial Relations Act 2009 are legislative instruments and will be registered on the Federal Register of Legislative Instruments. The determination exempts these instruments from the disallowance provisions, allowing the Minister to meet their obligation under the Intergovernmental Agreement on Federal Financial Relations to make payments of general purpose financial assistance in a prescribed manner. This legislation applies to all States in Australia and is intended to improve transparency in the financial assistance provided to the States. The Commonwealth's commitment to the provision of on-going financial support for the States' service delivery efforts is implemented through this determination.

Key Provisions

The Federal Financial Relations (General purpose financial assistance) Determination No. 75 (June 2015) outlines key provisions for the management and distribution of general purpose financial assistance under the Federal Financial Relations Act 2009. This determination, made by the Minister, aims to provide clarity on the process and requirements for distributing funds through the COAG Reform Fund for general revenue assistance (section 9(1)). The funds allocated under this determination are intended for use by the states for any purpose, ensuring flexibility in how the assistance is applied. The legislation specifies that these payments are to be used in accordance with the Intergovernmental Agreement on Federal Financial Relations, which was signed in December 2008. Under this Act, the Minister is required to credit amounts to the COAG Reform Fund, which is established as a Special Account under the COAG Reform Fund Act 2008 and governed by the Financial Management and Accountability Act 1997. The Minister’s determinations regarding the distribution of general purpose financial assistance are legislative instruments and must be registered on the Federal Register of Legislative Instruments (section 9(2)). Importantly, these determinations are exempt from disallowance, allowing the Minister to meet the obligation to make payments as prescribed by the Intergovernmental Agreement. This exemption ensures that the process of providing financial assistance remains streamlined and efficient, without the need for legislative scrutiny that could delay or impede the distribution of funds. The obligations imposed by the Federal Financial Relations Act 2009 on the parties involved include the requirement for extensive consultation with the states. The Intergovernmental Agreement on Federal Financial Relations, which underpins this determination, was developed through extensive consultation with all jurisdictions and is publicly available. This ongoing consultation process is crucial for maintaining transparency and ensuring that the needs and priorities of all parties are considered in the allocation and use of general purpose financial assistance. The Minister is also obligated to make payments of general purpose financial assistance in a manner consistent with the Intergovernmental Agreement, ensuring that the funds are used effectively to support state service delivery efforts. Failure to comply with the provisions of the Federal Financial Relations Act 2009 or the Intergovernmental Agreement on Federal Financial Relations may result in civil or criminal consequences. While specific penalties are not detailed in the explanatory statement, breaches of legislative instruments can generally lead to enforcement actions by the relevant authorities. The exemption from disallowance for the Minister’s determinations does not extend to the broader obligations under the Act, meaning that non-compliance with the Act’s requirements could result in legal action. The exact consequences of a breach would depend on the nature and severity of the non-compliance, but could include fines, legal penalties, or other corrective measures to ensure adherence to the legislative framework.