Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020

Administered by Department of the Treasury

Legislation au F2020L00303 In force Legislative Instrument

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EXPLANATORY STATEMENT

Issued by authority of the Treasurer

Federal Financial Relations Act 2009

Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020

Section 15A of the Federal Financial Relations Act 2009 (the Act) provides that the Treasurer may determine that an amount specified in the determination is to be paid to a State, the Australian Capital Territory or the Northern Territory as specified in the determination for the purpose of making a grant of financial assistance for the purpose of expenditure in accordance with the National Health Reform Agreement.

The purpose of the Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020 is to specify amounts to be paid to each State, the Australian Capital Territory and Northern Territory for the 2018-19 financial year.

Under the Intergovernmental Agreement on Federal Financial Relations (the IGA) and the Act, the Commonwealth provides national health reform payments to the States, the Australian Capital Territory and the Northern Territory, as a financial contribution to support state service delivery in the area of healthcare, particularly public hospitals.  The details of the funding arrangements are set out in the National Health Reform Agreement.

From 2014-15, Commonwealth funding for most public hospital services has been calculated on an activity basis, so that funding varies with the public hospital services delivered in each State, the Australian Capital Territory and the Northern Territory.

For 2018-19, Schedule I of the Addendum to the National Health Reform Agreement provides that the Commonwealth will fund 45 per cent of the efficient growth in activity based services. Efficient growth consists of the national efficient price for any changes in the volume of services provided and the growth in the national efficient price of providing the existing volume of services.

Where services or functions are more appropriately funded through block grants and for teaching, training and research, clause I18 of Schedule I to the Addendum to the National Health Reform Agreement provides that the Commonwealth will fund 45 per cent of growth in the efficient cost of providing the services or performing the functions.

For the period, 2017-18 to 2019-20, annual growth in Commonwealth national health reform funding is capped at 6.5 per cent.

Advance payments in respect of national health reform are made throughout the financial year based on estimates of each jurisdiction’s anticipated entitlement for that year. In accordance with clause B62 of Schedule B to the National Health Reform Agreement, any adjustment between the advances paid to a jurisdiction and the jurisdiction’s determined entitlement will be spread equally across payments for a subsequent quarter.

In accordance with the functions of the Administrator of the National Health Funding Pool under paragraph 238(1)(a) of the National Health Reform Act 2011, the Administrator has calculated and advised the amounts required to be paid by the Commonwealth in respect of 2018-19 into each State Pool Account of the National Health Funding Pool under the National Health Reform Agreement. The Treasurer has accepted the Administrator’s advice in making this determination.

The IGA and the National Health Reform Agreement were subject to extensive consultation with the States and Territories and were signed by all jurisdictions. Both agreements are publicly available on the website for the Council on Federal Financial Relations. Consultation with the States and Territories on national health reform funding also occurs regularly, through the Administrator’s Jurisdictional Advisory Committee meetings.

Details of the Determination are set out in Attachment B.

The Determination is a legislative instrument for the purposes of the Legislation Act 2003. However, the Determination is not subject to disallowance.

The Determination commences on the day after registration.

ATTACHMENT A

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

The purpose of the Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020 is to specify the amount to be paid to each State, the Australian Capital Territory and the Northern Territory for the 2018-19 financial year.

Human rights implications

This Legislative Instrument does not engage any of the applicable rights or freedoms.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.


ATTACHMENT B

Details of the Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020

This Attachment sets out further details of the Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020 (the Determination).

Section 1 – Name

This section specifies the name of the Determination is the Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020.

Section 2 – Commencement

This section prescribes that the Determination commences the day after the Determination is registered on the Federal Register of Legislation.

Section 3 – Authority

This section provides that the Determination is made under the Federal Financial Relations Act 2009.

Section 4 – Definitions

This section provides definitions for the purposes of the Determination.

Section 5 – National health reform payments for the 2018-19 financial year

This section sets out the amounts required to be paid by the Commonwealth in respect of the 2018-19 financial year into each State Pool Account of the National Health Funding Pool under the National Health Reform Agreement.

The Administrator of the National Health Funding Pool (Administrator) has calculated and advised the amounts required to be paid to each State, the Australian Capital Territory and the Northern Territory, in accordance with paragraph 238(1)(a) of the National Health Reform Act 2011. The Treasurer has accepted the Administrator’s advice making the Determination.

Overview

The Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020 was enacted to provide the necessary funding for national health reform payments to the states, the Australian Capital Territory and the Northern Territory for the 2018-19 financial year. This Determination was issued under the authority of the Federal Financial Relations Act 2009 and aims to ensure that the Commonwealth meets its obligations to support state service delivery in the healthcare sector, particularly public hospitals, in accordance with the National Health Reform Agreement. This legislative instrument responds to the need for precise funding allocations based on activity and efficient cost growth as outlined in the Addendum to the National Health Reform Agreement. The policy objective is to maintain consistent and predictable funding for public hospital services across all jurisdictions. The Determination was made by the Treasurer in consultation with the Administrator of the National Health Funding Pool, who calculated the required payments based on the National Health Reform Agreement. The amounts specified in the Determination are intended to cover 45 per cent of the efficient growth in activity-based services and 45 per cent of the growth in the efficient cost of providing certain services, as per the National Health Reform Agreement. Annual growth in Commonwealth funding for national health reform is capped at 6.5 per cent for the period 2017-18 to 2019-20. This Determination was developed following extensive consultation with the states and territories and is consistent with the human rights and freedoms recognised in the international instruments listed in the Human Rights (Parliamentary Scrutiny) Act 2011.

Scope and Application

The Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020 applies to the financial allocation for the 2018-19 fiscal year under the Federal Financial Relations Act 2009. This Determination specifies the amounts to be paid by the Commonwealth to each State, the Australian Capital Territory, and the Northern Territory as part of the national health reform funding. These payments are intended to support state service delivery in the healthcare sector, particularly public hospitals, as outlined in the National Health Reform Agreement. The allocation is based on the efficient growth in activity-based services and the growth in the efficient cost of providing services or performing functions, as stipulated in the Addendum to the National Health Reform Agreement. The Commonwealth's funding is capped at a 6.5 per cent annual growth rate for the period from 2017-18 to 2019-20. The Treasurer has made this determination in accordance with the advice of the Administrator of the National Health Funding Pool. The Determination is a legislative instrument under the Legislation Act 2003 and it commences on the day after it is registered.

Key Provisions

The Federal Financial Relations (National Health Reform Payments for 2018-19) Determination 2020 (the Determination) specifies the amounts to be paid to each State, the Australian Capital Territory and the Northern Territory for the 2018-19 financial year under section 15A of the Federal Financial Relations Act 2009 (the Act). This legislation facilitates the Commonwealth's contribution to state health services, particularly public hospitals, in line with the National Health Reform Agreement (NHRA). The Determination is grounded in the Intergovernmental Agreement on Federal Financial Relations (IGA) and the NHRA, which were developed through extensive consultation with the states and territories and signed by all jurisdictions. Under the Determination, the Commonwealth is required to fund 45% of the efficient growth in activity-based services for 2018-19. This funding is calculated based on changes in the volume of services and the growth in the national efficient price of providing existing services. For services or functions funded through block grants, such as teaching, training, and research, the Commonwealth will fund 45% of the growth in the efficient cost of providing these services. The annual growth in Commonwealth national health reform funding is capped at 6.5% for the period 2017-18 to 2019-20. The Administrator of the National Health Funding Pool has calculated these amounts based on estimates of each jurisdiction’s anticipated entitlement, and the Treasurer has accepted this advice. The obligations imposed by the Determination on the Commonwealth include the calculation and payment of specified amounts to the states and territories for the 2018-19 financial year. These payments are to be made into each State Pool Account of the National Health Funding Pool. The Commonwealth must ensure that these payments align with the funding arrangements set out in the NHRA and the IGA. Additionally, the Commonwealth is required to consult regularly with the states and territories through the Administrator’s Jurisdictional Advisory Committee to review and adjust funding as necessary. While the Determination itself does not impose specific penalties for breaches, non-compliance with the terms of the NHRA or the IGA could potentially lead to legal consequences. The Act and other related legislation may impose penalties for non-compliance, including fines or other civil remedies. However, the Determination does not explicitly state these penalties; they would be found in the primary legislation governing the NHRA and IGA. It is essential for the Commonwealth to adhere to the terms of the Determination to ensure continued funding and support for state health services.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.