EXPLANATORY STATEMENT

Issued by authority of the Assistant Minister for Productivity, Competition, Charities and Treasury and Parliamentary Secretary to the Treasurer

Federal Financial Relations Act 2009

Federal Financial Relations (National Skills and Workforce Development Payments for 2024-25) Determination 2026

Section 12A of the Federal Financial Relations Act 2009 (the Act) provides that the Minister 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 Skills Agreement.

The purpose of the Federal Financial Relations (National Skills and Workforce Development Payments for 2024-25) Determination 2026 (the Determination) is to specify amounts to be paid to each State, the Australian Capital Territory and Northern Territory for the 2024-25 financial year.

Under the Intergovernmental Agreement on Federal Financial Relations (the IGA) and the Act, the Commonwealth provides payments to the States, the Australian Capital Territory and the Northern Territory, as a financial contribution to support each jurisdiction’s service delivery in the area of skills and workforce development. The details of the funding arrangements are set out in the National Skills Agreement.

Advance payments in respect of skills and workforce development are made throughout the financial year based on estimates of each jurisdiction’s anticipated entitlement for that year. In accordance with the National Skills Agreement, any adjustment between the advances paid to a jurisdiction and the jurisdiction’s determined entitlement is made in the first practicable payment after the Determination is made.

Details of the amounts to be paid to each State, the Australian Capital Territory and the Northern Territory for the 2024-25 financial year are outlined in Table 1 in Attachment C. The amount determined for each jurisdiction reflects the actual Eligible State Expenditure certificate provided by that jurisdiction to the Commonwealth in accordance with the National Skills Agreement.

The IGA and the National Skills Agreement were subject to extensive consultation with the States and Territories and were signed by all jurisdictions. They are publicly available on the Federal Financial Relations website. Ongoing consultation with the States and Territories on federal financial relations also occurs regularly.

Details of the Determination are set out in Attachment A.

The Determination is a legislative instrument for the purposes of the Legislation Act 2003.  In accordance with subsection 12A(3) of the Act and subsections 44(2) and 54(1) of the Legislation Act 2003, the Determination is not subject to disallowance or sunsetting on the grounds that the instrument is part of an intergovernmental scheme and gives effect to agreements between the Commonwealth and each of the States, the Australian Capital Territory and the Northern Territory. The instrument’s operation is effectively mechanical in that it simply details financial assistance to be provided to a State or Territory based on that State or Territory having satisfied the necessary agreed criteria.

The Determination commenced the day after it was registered on the Federal Register of Legislation.

A statement of Compatibility with Human Rights is at Attachment B.

ATTACHMENT A

Details of the Federal Financial Relations (National Skills and Workforce Development Payments for 2024-25) Determination 2026

Section 1 – Name of the instrument

This section provides that the name of the instrument is the Federal Financial Relations (National Skills and Workforce Development Payments for 2024-25) Determination 2026 (the Determination).

Section 2 – Commencement

This section provides that the Determination commences on the day after it 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 skills and workforce development payments for the 2024-25 financial year

This section sets out the amounts required to be paid by the Commonwealth in respect of the 2024-25 financial year to support each jurisdiction’s service delivery in the area of skills and workforce development, in accordance with the National Skills Agreement.

Details of the amounts to be paid to each State, the Australian Capital Territory and the Northern Territory for the 2024-25 financial year are outlined in Table 1 in Attachment C.

ATTACHMENT B

Statement of Compatibility with Human Rights

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

Federal Financial Relations (National Skills and Workforce Development Payments for 2024-25) Determination 2026

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

Under the Intergovernmental Agreement on Federal Financial Relations and the Federal Financial Relations Act 2009, the Commonwealth provides 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 skills and workforce development. The details of the funding arrangements are set out in the National Skills Agreement.

The purpose of the Federal Financial Relations (National Skills and Workforce Development Payments for 2024-25) Determination 2026 is to specify amounts to be paid to each State, the Australian Capital Territory and Northern Territory for the 2024-25 financial year, in accordance with the National Skills Agreement.

Human rights implications

This Legislative Instrument engages:

• the right to education, as referred to in Article 13 of the International Covenant on Economic, Social and Cultural Rights (done at New York on 16 December 1966 ([1976] ATS 5)) (ICESCR), Articles 28 and 29 of the Convention on the Rights of the Child (done at New York on 20 November 1989 ([1991] ATS 4)) (CRC) and Article 24 of the Convention on the Rights of Persons with Disabilities (done at New York on 30 March 2007 ([2008] ATS 12) (CRPD); and
• the right to work and rights in work, as referred to in Article 6 of the ICESCR and Article 27 of the CRPD.

This Instrument supports the above rights by providing funding to support the States and Territories delivery of programs, services and reforms with respect to skills and workforce development.

Conclusion

This Legislative Instrument is compatible with human rights as it supports the right to education, the right to work and rights in work by providing funding to the States and Territories to deliver programs, services and reforms with respect to skills and workforce development.

ATTACHMENT C

Table 1: Details of the amounts to be paid to each State, the Australian Capital Territory and Northern Territory for the 2024-25 financial year