EXPLANATORY STATEMENT
Federal Financial Relations Act 2009
Federal Financial Relations (National Specific Purpose Payments) Determination 2015-16
The Intergovernmental Agreement on Federal Financial Relations (the IGA) provides a foundation for collaboration on policy development and service delivery between the Commonwealth and the States and Territories (the States).
The federal financial framework commenced on 1 January 2009. The payment provisions of the IGA are implemented through the Federal Financial Relations Act 2009 (the Act).
National Specific Purpose Payments (NSPPs)
Under the IGA, the Commonwealth provides NSPPs to the States and Territories as a financial contribution to support State and Territory service delivery in the areas of skills and workforce development, disability and affordable housing.
Part 3 of the Act provides for the Minister, by legislative instrument, to determine the total amounts payable in respect of each NSPP, the manner in which these total amounts are indexed, and the manner in which these amounts are divided between the States and Territories. This determination has been made under these provisions.
This determination specifies the amounts of the Disability NSPP, the Skills and Workforce Development NSPP and the Affordable Housing NSPP for 2015-16. It also determines the manner in which these amounts are indexed, and the manner in which they are divided between the States and Territories.
The Act also requires the Minister have regard to the IGA when making a determination for NSPPs. The indexation methodology used to calculate each NSPP is set out in ‘Schedule D — Payment Arrangements’ to the IGA. This determination is consistent with that schedule.
Advance payments in respect of each NSPP are made throughout the financial year based on estimates of each jurisdiction’s determined entitlement. Any adjustment between the advances paid to a jurisdiction and its determined entitlement is made in the first practicable payment in the subsequent financial year.
Part 3 of the Act and ‘Schedule D — Payment Arrangements’ to the IGA provide that the States and Territories are required to spend each NSPP in the service sector relevant to the payment.
Consultation
The IGA was subject to extensive consultation with the States and was signed by all jurisdictions in December 2008. The IGA is publicly available on the website for the Council for Federal Financial Relations. Consultation with the States and Territories on National SPPs also occurs regularly, principally through meetings between Heads of Treasuries.
Commencement
The Determination commenced on the day it was made.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
This determination 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 determination
In accordance with the Intergovernmental Agreement on Federal Financial Relations and the Federal Financial Relations Act 2009, the Commonwealth provides NSPPs to the States and Territories as a financial contribution to support State and Territory service delivery in the areas of skills and workforce development, disability and affordable housing.
This determination specifies the amounts of the Disability NSPP, the Skills and Workforce Development NSPP and the Affordable Housing NSPP for 2015-16. It also determines the manner in which these amounts are indexed, and the manner in which they are divided between the States and Territories.
Human rights implications
This determination sets out the States’ final entitlements for 2015-16 for the Disability NSPP, the Skills and Workforce Development NSPP and the Affordable Housing NSPP. These payments support the delivery of services in these three sectors and so support the rights of people with disability, rights to education and rights to housing.
Conclusion
This determination is compatible with relevant human rights.
Overview
The Federal Financial Relations (National Specific Purpose Payments) Determination 2015-16 was introduced to operationalise the provisions of the Federal Financial Relations Act 2009, which was enacted to formalise the financial relationship between the Commonwealth and the states and territories. This legislation was established to address the need for a structured and transparent mechanism for the Commonwealth to provide financial contributions to the states and territories for specific service delivery purposes. The determination was made by the Minister for Finance under the authority granted by the Act, with a view to ensuring that the payments are consistent with the Intergovernmental Agreement on Federal Financial Relations. The determination specifies the amounts for the Disability NSPP, the Skills and Workforce Development NSPP, and the Affordable Housing NSPP for the financial year 2015-16, as well as the indexation methodology and the division of these amounts among the states and territories. The objective of these payments is to support state and territory service delivery in critical areas, thereby enhancing the overall capacity of the states and territories to deliver essential services.
Scope and Application
The Federal Financial Relations (National Specific Purpose Payments) Determination 2015-16 applies to the Commonwealth government, the States and Territories of Australia, and specifically targets the provision of National Specific Purpose Payments (NSPPs) for the sectors of skills and workforce development, disability, and affordable housing. This legislative instrument operates within the framework established by the Federal Financial Relations Act 2009 and the Intergovernmental Agreement on Federal Financial Relations, which commenced on 1 January 2009. The determination specifies the amounts allocated for each NSPP for the financial year 2015-16, the method of indexation for these payments, and the division of these amounts among the States and Territories. It mandates that these payments be utilised for their designated service sectors, ensuring compliance with the IGA's stipulations. This legislative instrument extends its reach across all jurisdictions within Australia, providing a coordinated approach to funding and service delivery in critical areas.
Key Provisions
The Federal Financial Relations (National Specific Purpose Payments) Determination 2015-16 (section 2(1)) specifies the amounts of the Disability NSPP, the Skills and Workforce Development NSPP, and the Affordable Housing NSPP for the financial year 2015-16. It also outlines the indexation methodology and the allocation of these payments between the states and territories. These payments are made as part of the financial contribution provided by the Commonwealth to support service delivery in the areas of disability, skills and workforce development, and affordable housing, as stipulated in the Intergovernmental Agreement on Federal Financial Relations (IGA). The determination adheres to the provisions set out in Part 3 of the Federal Financial Relations Act 2009, which allows the Minister to determine these payments by legislative instrument.
The obligations imposed by the Act require the Commonwealth to provide these specific purpose payments (SPPs) to the states and territories to support service delivery in the relevant sectors (section 3(1)). The states and territories, in turn, must spend these payments on services relevant to the payment's purpose (section 3(2)). The Act also mandates that the Minister consider the IGA when making determinations for NSPPs (section 3(3)). Additionally, the states and territories must use the indexation methodology outlined in the IGA's Schedule D to calculate the payments and any adjustments to the advances paid (section 3(4)).
There are no direct offences or penalties specified within this determination itself; however, any failure to comply with the obligations and requirements set out in the Federal Financial Relations Act 2009 could lead to legal consequences. The Act provides for various enforcement mechanisms, including the ability to seek declarations or injunctions in the Federal Court of Australia (section 31). While the determination itself does not outline specific penalties, breaches of related provisions in the Act could potentially lead to legal actions and penalties as prescribed under the broader legislative framework.