EXPLANATORY STATEMENT
Issued by the authority of the Minister for Industry and Science
Industry Research and Development Act 1986
Industry Research and Development (International Engagement for Green Metals Standards Program) Instrument 2025
Purpose and Operation
Section 33 of the Industry Research and Development Act 1986 (the IR&D Act) provides a mechanism for the Minister to prescribe programs, by disallowable legislative instrument, in relation to industry, innovation, science or research, including in relation to the expenditure of Commonwealth money under such programs.
The statutory framework provided by section 33 of the IR&D Act enables a level of flexibility to provide authority for Commonwealth spending activities in relation to industry, innovation, science and research programs. This allows the Government to respond quickly and appropriately to the need to implement innovative ideas and pilot programs on an ongoing basis and as opportunities arise. Prescribing programs in legislative instruments provides transparency and parliamentary oversight of Government programs and spending activities, whilst reducing administrative burden on the Commonwealth.
Once a program is prescribed by the Minister under section 33, subsection 34(1) allows the Commonwealth to make, vary or administer arrangements in relation to activities under the prescribed program. Arrangements may include contracts, funding agreements or other arrangements, and may provide for money to be payable by the Commonwealth to one or more third parties. The power conferred on the Commonwealth by subsection 34(1) may be exercised on behalf of the Commonwealth by a Minister or an accountable authority of a non-corporate Commonwealth entity, or by their delegate (under section 36).
The purpose of the Industry Research and Development (International Engagement for Green Metals Standards Program) Instrument 2025 (the Legislative Instrument) is to prescribe the International Engagement for Green Metals Standards Program (the Program). The funding for the Program has been secured through the Department of Industry, Science, and Resources 2024-2025 Budget. The Program provides up to $1.5 million over 2 years from 2025-26 as part of the Australian Government’s commitment to promoting Australia’s competitiveness in green metals. The Program will support the development of technical standards for green metals and contribute to Australia’s ability to shape international definitions to meet Australian interests.
The objectives of the Program are to:
• support Australian leadership in the development of green metals standards internationally;
• facilitate cross-sector collaboration to accelerate the development of green metals standards;
• capitalise on Australia’s comparative advantage in renewable energy, abundant mineral resources, manufacturing capability and skilled workforce by fast-tracking green metals standards;
• ensure modern frameworks for green metals standards drive industry innovation and compliance;
• identify gaps and opportunities for new standards to support green metals development; and
• complement other Government programs related to green metals standards.
The intended outcomes of the Program are to prioritise and deliver international green metals standards aligned with government objectives and industry needs.
Funding under the Program will be available to Standards Australia, ABN 85 087 326 690, for eligible activities. Standards Australia has been identified as the appropriate recipient because:
• it has a well-established record of delivering the same or similar activities and specialises in the development and adoption of internationally-aligned standards
• it is Australia’s member of the International Organisation for Standardisation (ISO)
• the nature of the grant activity is specifically dependent on the expertise of Standards Australia.
Eligible activities under the Program include standards mapping, research into carbon accounting methodologies and traceability standards to support certification schemes, establishment of working groups to develop and harmonise standards, development of standards, and establishment of ISO green metals technical committees. Other activities that are likely to achieve the objectives and outcomes of the Program may also be eligible.
Funding authorised by this Legislative Instrument comes from Program 1.1, Outcome 1, as set out in the Portfolio Budget Statements 2025-26, Budget Related Paper No. 1.11, Industry, Science, and Resources Portfolio (https://www.industry.gov.au/sites/default/files/2025-03/2025-26-department-of-industry-science-resources-pbs.pdf) at page 23.
The Program will be delivered by the Business Grants Hub, which is a specialised design, management and delivery body within the Department of Industry, Science and Resources with extensive expertise and capability in delivering similar programs.
The Program is administered by the Department in accordance with the Commonwealth Grant Rules and Principles 2024 (CGRPs) https://www.legislation.gov.au/F2024L00854/asmade/2024-07-05/text/original/pdf. Spending decisions will be made by the Program Delegate who is the General Manager responsible for administering the Program, taking into account the recommendations of the Department. The Program Delegate is an SES officer who holds delegation under the Department’s general financial framework, including delegation under the Public Governance, Performance and Accountability Act 2013, and sections 34 and 35 of the IR&D Act.
The Program is a closed non-competitive grant that is subject to eligibility and merit assessment. The application must address the eligibility and merit criteria, and provide relevant supporting information. The amount of detail and supporting evidence should be relative to the project size, complexity and funding amount requested. Funding will only be awarded if the application meets the required assessment criteria. The assessment criteria and grant selection process are detailed in Section 6 and Section 8 of the Grant Opportunity Guidelines.
Business Grants Hub will assess the application against the assessment criteria and make a recommendation to the Program Delegate regarding its suitability for funding. The Program Delegate will make the final decision whether to approve the grant, taking into consideration BGH’s assessment and recommendation, and the availability of grant funds. The Program Delegate will not approve funding if there are insufficient Program funds available across relevant financial years for the Program.
The successful applicant will be informed in writing. If the applicant is unsuccessful, they will have an opportunity to discuss the outcome with the Department.
Persons who are otherwise affected by decisions or who have complaints about the Program will also have recourse to the Department. The Department investigates any complaints about the Program in accordance with its complaints policy and procedures. If a person is not satisfied with the way the Department handles the complaint, they may lodge a complaint with the Commonwealth Ombudsman.
Statement of the Relevance and Operation of Constitutional Heads of Power
For the purposes of subsection 33(3) of the Act, the powers of the Parliament to make laws with respect to the following are specified for the Program prescribed by the Legislative Instrument:
- trade and commerce with other countries, and among the States (within the meaning of paragraph 51(i) of the Constitution);
- external affairs (within the meaning of paragraph 51(xxix) of the Constitution).
Trade and commerce power
Paragraph 51(i) of the Constitution empowers the Parliament to make laws with respect to ‘trade and commerce with other countries, and among the states’.
In that regard, the Program prescribed by the Legislative Instrument will provide funding to foster interstate and overseas trade and commerce in the green metals industry. There is domestic and international demand for Australian metals suppliers to provide green metals, including aluminium, iron, steel, and alumina, but a lack of clear definitions and standards is a key investment barrier. How green metals are defined and standardised will influence trade and investment opportunities for the industry, both domestically and overseas.
External affairs power
The external affairs power in paragraph 51(xxix) of the Constitution empowers the Commonwealth Parliament to make laws with respect to ‘external affairs’. The external affairs power supports legislation implementing Australia’s international obligations under treaties to which it is a party. Australia has obligations under the following treaties:
• the United Nations Framework Convention on Climate Change done at New York on 9 May 1992 ([1994] ATS 2) (UNFCC), particularly Article 4;
• the Kyoto Protocol to the United Nations Framework Convention on Climate Change done at Kyoto on 11 December 1997 ([2008] ATS 2) (Kyoto Protocol), particularly Article 10; and
• the Paris Agreement done at Paris on 12 December 2015 ([2016] ATS 24) (Paris Agreement), particularly Articles 4 and 10.
The United Nations Framework Convention on Climate Change includes a range of obligations on Australia to take domestic actions that reduce Australia’s emissions of greenhouse gases. Relevantly, it provides that parties shall:
- formulate, implement, publish and regularly update national and, where appropriate, regional programs containing measures to mitigate climate change by addressing anthropogenic emissions by sources and removals by sinks of all greenhouse gases not controlled by the Montreal Protocol on Substances that Deplete the Ozone Layer done at Montreal on 16 September 1987 ([1989] ATS 18]), and measures to facilitate adequate adaptation to climate change;[1]
- promote and cooperate in the development, application and diffusion of technologies, practices and processes that control, reduce or prevent anthropogenic emissions of greenhouse gases in all relevant sectors including energy, transport, industry, agriculture, forestry and waste management sectors;[2] and
- adopt national policies and take corresponding measures on the mitigation of climate change, by limiting its anthropogenic emissions of greenhouse gases and protecting and enhancing its greenhouse gas sinks and reservoirs.[3]
The Kyoto Protocol includes obligations on Australia to take action to reduce emissions. For example, Article 10(b) requires parties to formulate, implement and report upon climate change mitigation and adaptation programs. Additionally, Article 10(c) requires parties to cooperate in the development, application and diffusion of environmentally sound technologies.
The Paris Agreement was entered into by the parties to the United Nations Framework Convention on Climate Change to enhance its implementation. Under the Paris Agreement, Australia has a “nationally determined contribution”, comprising a 2030 emissions reduction target of 43 per cent below 2005 levels and net zero emissions by 2050. Australia’s greenhouse gas emission reduction targets, which reflect its nationally determined contribution, have been legislated in the Climate Change Act 2022. Relevantly, Article 4.2 of the Paris Agreement provides that “[e]ach Party shall prepare, communicate and maintain successive nationally determined contributions that it intends to achieve” and that “[p]arties shall pursue domestic mitigation measures, with the aim of achieving the objectives of such contributions”. Additionally, Article 10.2 of the Paris Agreement provides that the Parties “shall strengthen cooperative action on technology development and transfer”.
The Program prescribed by the Legislative Instrument will facilitate the achievement of Australia’s international emissions reduction obligations. Enabling Standards Australia to participate in international forums to develop standards for green metals will contribute to Australia meeting its international emissions reduction obligations by fostering industry investment in and consumer demand for green metals and the development and transfer of relevant technology.
The external affairs power also supports legislation with respect to matters or things outside the geographical limits of Australia. Enabling Standards Australia to engage in international forums will deepen Australia’s relationships with other countries.
Further details of the Legislative Instrument are set out at Attachment A.
Authority
Section 33 of the IR&D Act provides authority for the Legislative Instrument.
Consultation
The Department has engaged with Standards Australia, the Department of Climate Change, Energy, the Environment and Water and the Department of Treasury to inform the policy development and design of the grant. The grant guidelines were reviewed and cleared by the Department of the Prime Minister and Cabinet and the Department of Finance.
In accordance with section 17 of the Legislation Act 2003, the Attorney-General’s Department has been consulted on this Legislative Instrument.
Statement of Compatibility with Human Rights
A Statement of Compatibility with Human Rights for the purposes of Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 is set out at Attachment B.
Attachment A
Details of the Industry Research and Development (International Engagement for Green Metals Standards Program) Instrument 2025
Section 1 – Name of Instrument
This section specifies the name of the Legislative Instrument as the Industry Research and Development (International Engagement for Green Metals Standards Program) Instrument 2025.
Section 2 – Commencement
This section provides that the Legislative Instrument commences on the day after registration on the Federal Register of Legislation.
Section 3 – Authority
This section specifies the provision of the IR&D Act under which the Legislative Instrument is made.
Section 4 – Definitions
This item provides for definitions of terms used in the Legislative Instrument.
Section 5 – Prescribed program
This section prescribes the Program for the purposes of section 33(1) of the IR&D Act.
The Program provides funding to Standards Australia to participate in relevant international forums to develop standards for green (low carbon) metals, as well as to undertake activities necessary for or incidental to that participation. Funding will be in the form of a grant and will:
• support Australian leadership in green metals standards internationally;
• enhance Australian industry collaboration and engagement in the development and adoption of technical standards for green metals;
• capitalise on Australia’s comparative advantage in renewable energy, abundant mineral resources, manufacturing capability and skilled workforce by fast-tracking green metals standards; and
• ensure modern frameworks for green metals standards drive industry innovation and compliance.
Section 6 – Specified Legislative Power
This section specifies that, for the purposes of subsection 33(3) of the Act, the powers of the Parliament to make laws with respect to the following are specified:
- trade and commerce with other countries, and among the States (within the meaning of paragraph 51(i) of the Constitution);
- external affairs (within the meaning of paragraph 51(xxix) of the Constitution).
Attachment B
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Industry Research and Development (International Engagement for Green Metals Standards Program) Instrument 2025
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 Industry Research and Development (International Engagement for Green Metals Standards Program) Instrument 2025 (the Legislative Instrument) provides legislative authority to commit Commonwealth funding for the International Engagement for Green Metals Standards Program (the Program). The Program will provide funding for Standards Australia to engage in the development of international standards for green metals and shape the conversation around definitions to Australia’s benefit. This will support the Australian Government’s commitment to support green metals as a priority sector under a Future Made in Australia.
The purpose of the Program is to strengthen Australia’s sovereign capability to produce green metals through the development of technical standards. The Program will help Australia gain an early mover advantage, particularly for aluminium and help contribute to emissions reductions in the aluminium smelting industry.
Human rights implications
The Legislative Instrument does not engage any of the applicable rights or freedoms.
Conclusion
The Legislative Instrument is compatible with human rights as it does not raise any human rights issues.
Senator the Hon Tim Ayres
Minister for Industry and Innovation
[1] See Article 4.1(b).
[2] See Article 4.1(c).
[3] See Article 4.2(a).