EXPLANATORY STATEMENT
Issued by the Authority of the Minister for Finance
Financial Framework (Supplementary Powers) Act 1997
Financial Framework (Supplementary Powers) Amendment
(Infrastructure and Regional Development Measures No. 2) Regulation 2016
The Financial Framework (Supplementary Powers) Act 1997 (the FF(SP) Act) confers on the Commonwealth, in certain circumstances, powers to make arrangements under which money can be spent; or to make grants of financial assistance; and to form, or otherwise be involved in, companies. The arrangements, grants, programs and companies (or classes of arrangements or grants in relation to which the powers are conferred) are specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the Principal Regulations). The FF(SP) Act applies to Ministers and the accountable authorities of non‑corporate Commonwealth entities, as defined under section 12 of the Public Governance, Performance and Accountability Act 2013.
Section 65 of the FF(SP) Act provides that the Governor-General may make regulations prescribing matters required or permitted by that Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to that Act.
Section 32B of the FF(SP) Act authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Principal Regulations. Section 32B also authorises the Commonwealth to make, vary and administer arrangements for the purposes of programs specified in the Principal Regulations. Schedule 1AA and Schedule 1AB to the Principal Regulations specify the arrangements, grants and programs.
Schedule 1 to the Regulation amends Schedule 1AB to the Principal Regulations to establish legislative authority for government spending on the Building Better Regions Fund which will be administered by the Department of Infrastructure and Regional Development.
The Building Better Regions Fund (BBRF) is a $297.7 million grant program designed to invest in projects to create jobs, drive economic growth and build strong, sustainable regional communities into the future. The BBRF will provide grant funding on a competitive basis under two streams: infrastructure projects and community investments.
Details of the BBRF were announced by the Minister for Regional Development, Senator the Hon Fiona Nash, on 23 November 2016.
Details of the Regulation are set out at Attachment A. A Statement of Compatibility with Human Rights is at Attachment B.
The Regulation is a legislative instrument for the purposes of the Legislation Act 2003. The Regulation commences on the day after registration on the Federal Register of Legislation.
Consultation
In accordance with section 17 of the Legislation Act 2003, consultation has taken place with the Department of Infrastructure and Regional Development.
A regulation impact statement is not required as the Regulation only applies to non‑corporate Commonwealth entities and does not adversely affect the private sector.
Details of the Financial Framework (Supplementary Powers) Amendment (Infrastructure and Regional Development Measures No. 2) Regulation 2016
Section 1 – Name
This section provides that the title of the Regulation is the Financial Framework (Supplementary Powers) Amendment (Infrastructure and Regional Development Measures No. 2) Regulation 2016.
Section 2 – Commencement
This section provides that the Regulation commences on the day after it is registered on the Federal Register of Legislation.
Section 3 – Authority
This section provides that the Regulation is made under the Financial Framework (Supplementary Powers) Act 1997.
Section 4 – Schedules
This section provides that the Financial Framework (Supplementary Powers) Regulations 1997 are amended as set out in the Schedules to the Regulation.
Schedule 1 – Amendments
Item 1 – In the appropriate position in Part 4 of Schedule 1AB (table)
This item adds a new table item to Part 4 of Schedule 1AB to establish legislative authority for government spending on the Building Better Regions Fund which will be administered by the Department of Infrastructure and Regional Development.
New table item 191 establishes legislative authority for government spending on the Building Better Regions Fund (BBRF).
The BBRF is a $297.7 million grant program designed to invest in projects to create jobs, drive economic growth and build strong, sustainable regional communities into the future. The BBRF will provide grant funding on a competitive basis under two streams: infrastructure projects and community investments.
Details of the BBRF were announced by the Minister for Regional Development, Senator the Hon Fiona Nash, on 23 November 2016. Funding for the four-year program will be included in the Mid-Year Economic and Fiscal Outlook 2016-17.
The Department of Infrastructure and Regional Development has policy responsibility for the BBRF and the Department of Industry, Innovation and Science’s Business Grants Hub will administer applications, project assessment processes and contract management. Details of eligibility and assessment criteria are included in the grant guidelines which are available publicly on the www.business.gov.au website.
Funding decisions will be made by a Ministerial Panel, chaired by the Minister for Regional Development, following receipt of advice from the Department of Infrastructure and Regional Development.
The Department’s recommendations will be made based on an application’s eligibility and relative merit against published guidelines. Any variation to the Department’s recommendations by the Ministerial Panel will be recorded and will form part of the overall record of the decision. Funding decisions will be published on the Department’s website.
The decision of the Ministerial Panel will be final. Administrative decisions of this nature are generally recognised as not being appropriate for merits review. Eligible projects will be ranked in comparison with projects of a similar size according to total project cost. However, the breadth and diversity of project types and the projected benefits in the regions will vary greatly. Therefore, merits review is not considered appropriate for this program. The grant guidelines will, however, ensure that the decision-making process is objective and transparent and that eligibility criteria are clear.
Funding for this item will come from Program 3.1: Regional Development, which is part of Outcome 3: Strengthening the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities; and providing grants and financial assistance. Details will be set out in the Portfolio Additional Estimates Statements 2016-17: Infrastructure and Regional Development Portfolio.
Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the following powers of the Constitution:
- the interstate and international trade and commerce power (section 51(i));
- the external affairs power (section 51(xxix));
- the territories power (section 122);
- the power to grant financial assistance to States (section 96);
- the railway construction and extension power (section 51(xxxiv));
- the race power (section 51(xxvi));
- the aliens power (section 51(xix));
- the immigration power (section 51(xxvii));
- the social welfare power (section 51(xxiiiA));
- the communications power (section 51(v)); and
- the Commonwealth executive power and the express incidental power (section 61 and section 51(xxxix)).
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Financial Framework (Supplementary Powers) Amendment (Infrastructure and Regional Development Measures No. 2) Regulation 2016
This Regulation 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
Section 32B of the Financial Framework (Supplementary Powers) Act 1997 (the FF(SP) Act) authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the FF(SP) Regulations) and to make, vary and administer arrangements and grants for the purposes of programs specified in the Regulations. Schedule 1AA and Schedule 1AB to the FF(SP) Regulations specify the arrangements, grants and programs.
The FF(SP) Act applies to Ministers and the accountable authorities of non‑corporate Commonwealth entities, as defined under section 12 of the Public Governance, Performance and Accountability Act 2013.
Schedule 1 to the Regulation amends Schedule 1AB to the FF(SP) Regulations to establish legislative authority for government spending on the Building Better Regions Fund (BBRF) which will be administered by the Department of Infrastructure and Regional Development.
The BBRF is a grant program designed to invest in projects to create jobs, drive economic growth and build strong, sustainable regional communities into the future. Under the BBRF, grant funding will be provided on a competitive basis under two streams: infrastructure projects and community investments.
The Department of Infrastructure and Regional Development has policy responsibility for the BBRF and the Department of Industry, Innovation and Science’s Business Grants Hub will administer applications, project assessment processes and contract management.
The Minister for Regional Development has portfolio responsibility for this matter.
Human rights implications
The Regulation does not engage any of the applicable rights or freedoms.
Conclusion
This Regulation is compatible with human rights as it does not raise any human rights issues.
Senator the Hon Mathias Cormann
Minister for Finance