Federal Financial Relations (National Partnership payments) Determination 2009 No. 3 (June)

Overview

The Federal Financial Relations Act 2009, enacted to enhance the framework for federal financial relations in Australia, addresses the need for a robust mechanism to support states in their service delivery efforts. This Act establishes the basis for ongoing financial support for states through general purpose financial assistance, National Specific Purpose Payments, and National Partnership payments. The Federal Financial Relations (National Partnership payments) Determination 2009 further operationalises these provisions by detailing the legislative process for making National Partnership payments, ensuring they are credited to the COAG Reform Fund established under the COAG Reform Fund Act 2008. The determination aims to improve transparency by ensuring these payments are registered as legislative instruments on the Federal Register of Legislative Instruments, while clarifying that they are not subject to disallowance, thereby allowing the Minister to meet obligations under the Intergovernmental Agreement on Federal Financial Relations.

Scope and Application

The Federal Financial Relations Act 2009 applies to the Australian Commonwealth, the states, and the territories, establishing the framework for financial relations between these entities. The Act facilitates the provision of ongoing financial support to the states through various means, including general purpose financial assistance, National Specific Purpose Payments, and National Partnership payments. These payments are intended to support service delivery efforts, foster policy development and service delivery collaboration, and enable the implementation of economic and social reforms of national significance. The Act authorises the Minister to credit amounts to the COAG Reform Fund for the purpose of providing National Partnership payments to the states, which are specified outputs or projects designed to facilitate reforms or reward jurisdictions that deliver on nationally significant reforms. The Act provides clarity on the legislative nature of the Minister's determinations regarding National Partnership payments, ensuring they are legislative instruments and are registered on the Federal Register of Legislative Instruments, but exempt from disallowance provisions to allow the Minister to meet the obligations under the Intergovernmental Agreement. The Act's commencement date is the day it was made.

Key Provisions

The Federal Financial Relations (National Partnership Payments) Determination 2009 (No. 3) (F2009L02673) implements key provisions of the Federal Financial Relations Act 2009, focusing on National Partnership payments. Section 9(1) of the Act mandates that the Minister credits amounts to the COAG Reform Fund to provide financial assistance to the states. The COAG Reform Fund Act 2008 establishes the fund as a Special Account under the Financial Management and Accountability Act 1997, ensuring that these payments are managed transparently and accountably. Under this determination, the Minister's decisions regarding National Partnership payments are legislative instruments and will be registered on the Federal Register of Legislative Instruments. However, these instruments are exempt from the disallowance provisions, meaning they cannot be annulled by either house of Parliament. This exemption ensures the Minister can meet the obligations set out in the Intergovernmental Agreement to make payments in a prescribed manner. The determination clarifies that the Minister's determinations would otherwise not qualify as legislative instruments under section 5 of the Legislative Instruments Act 2003. The obligations imposed by the determination include the timely and accurate crediting of amounts to the COAG Reform Fund as per the Intergovernmental Agreement. The Minister must ensure that the payments are made to the states in a manner that aligns with the agreement’s requirements. Additionally, the Minister has a responsibility to maintain transparency and accountability in the use of these funds, ensuring they are used for the specified purposes outlined in the agreement. Breach of the obligations under this determination can have significant consequences. Although specific offences and penalties are not detailed in the explanatory statement, breaches of similar legislative instruments can lead to civil or criminal sanctions. For example, failure to comply with financial management laws can result in fines, imprisonment, or both, depending on the severity of the breach. The maximum penalties for such breaches can vary widely, but they are intended to ensure compliance with the legislative requirements.