Loan (Defence)
No. 37 of 1970
An Act to Authorize the Raising and Expending of a certain sum of Money for Defence Purposes.
[Assented to 23 June 1970]
BE it enacted by the Queen’s Most Excellent Majesty, the Senate, and the House of Representatives of the Commonwealth of Australia, as follows:—
Short title.
1. This Act may be cited as the Loan (Defence) Act 1970.
Commencement.
2. This Act shall come into operation on the day on which it receives the Royal Assent.
Interpretation.
3. For the purposes of this Act, the payment by a person or authority of moneys in discharge of a liability of the Commonwealth shall be taken to be a loan of an amount equal to those moneys by that person or authority to the Commonwealth.
Authority to borrow $US 100,000,000.
4. Approval is given to the making and carrying out by the Commonwealth of an agreement or agreements for or in relation to the borrowing by the Commonwealth of moneys in the currency of the United States of America, not exceeding in the whole One hundred million dollars in that currency, for defence purposes.
Securities.
5. An agreement made in pursuance of this Act may provide for the issue and delivery of promissory notes or other securities by or on behalf of the Commonwealth in respect of any liability of the Commonwealth under such an agreement.
Expenditure of loan moneys.
6. The proceeds of any loan raised under the authority of this Act may be issued and applied for defence purposes.
Appropriation.
7. Any moneys payable by the Commonwealth under an agreement made in pursuance of this Act or under a promissory note or other security under such an agreement, including interest, are payable out of the Consolidated Revenue Fund, which is appropriated accordingly.
Exemption from taxes, &c.
8. Where an agreement made in pursuance of this Act provides that—
(a) the agreement or any matter or thing related to the agreement;
(b) a promissory note or other security under the agreement or for the purposes of the agreement; or
(c) a payment made under the agreement or under such a promissory note or other security,
is to be exempt or free from taxes, duties, fees, restrictions, charges or other matters, that agreement, matter, thing, note, security or payment is so exempt or free notwithstanding anything contained in any law of the Commonwealth or of a State or Territory of the Commonwealth.
National Debt Sinking Fund Act not to apply.
9. The National Debt Sinking Fund Act 1966–1967 does not apply in relation to moneys borrowed under an agreement made in pursuance of this Act.
Overview
The Loan (Defence) Act 1970 was enacted by the Parliament of Australia to facilitate the borrowing of funds for defence purposes. This legislation addresses the need for additional financial resources to support the nation's defence capabilities. The Act allows for the borrowing of up to US$100,000,000 in the currency of the United States, providing flexibility in securing the necessary funds for defence initiatives. The policy objective of this Act is to ensure that the Commonwealth can meet its defence obligations through authorised borrowing, thereby maintaining national security.
Under the authority granted by this Act, the Commonwealth can enter into agreements to borrow the specified amount, issue securities in respect of these liabilities, and apply the loan proceeds directly to defence purposes. The Act also ensures that any related payments and securities are exempt from certain taxes and charges, and it excludes the application of the National Debt Sinking Fund Act 1966–1967 to the borrowed funds. This legislation provides a clear and legal framework for the Commonwealth to address its defence funding needs efficiently.
Scope and Application
The Loan (Defence) Act 1970 authorises the Commonwealth to borrow up to $US 100,000,000 for defence purposes, providing a framework for the issuance and application of funds derived from such loans. The Act applies to the Commonwealth, enabling it to enter into agreements for borrowing in the currency of the United States of America and to issue promissory notes or other securities as necessary. The proceeds of these loans are specifically earmarked for defence purposes, ensuring that the borrowed funds are applied directly towards national defence initiatives. The Act is applicable on a national level within Australia, encompassing both the Commonwealth and the states and territories under its jurisdiction. Notably, this legislation exempts the agreements, securities, and related payments from any taxes, duties, fees, restrictions, charges, or other matters that may otherwise apply under federal, state, or territory laws, thereby facilitating the smooth execution of the loan agreements for defence purposes. Furthermore, the Act explicitly excludes the application of the National Debt Sinking Fund Act 1966–1967 to the monies borrowed under its authority.
Key Provisions
The Loan (Defence) Act 1970 (sections 1-9) outlines the framework for the Commonwealth of Australia to borrow up to $US 100,000,000 for defence purposes. The Act commences immediately upon receiving Royal Assent (section 2). The Act provides a broad definition of the term "loan" as any payment of moneys by a person or authority to discharge a liability of the Commonwealth (section 3). Under this Act, the Commonwealth is authorised to enter into agreements for the borrowing of up to $US 100,000,000 in US currency, specifically for defence purposes (section 4). The Act allows for the issuance and delivery of promissory notes or other securities by or on behalf of the Commonwealth in respect of any liabilities under such agreements (section 5). The proceeds from any loans raised under this Act can be applied solely for defence purposes (section 6). Any payments due by the Commonwealth under these agreements, including interest, will be paid from the Consolidated Revenue Fund, which is appropriated accordingly (section 7). Additionally, the Act exempts the agreements, promissory notes, securities, and payments from any taxes, duties, fees, restrictions, charges, or other matters, regardless of any other provisions in Commonwealth or State or Territory laws (section 8). Importantly, the National Debt Sinking Fund Act 1966-1967 does not apply to the moneys borrowed under this Act (section 9).
The Loan (Defence) Act 1970 imposes several obligations and requirements on the Commonwealth. Firstly, the Commonwealth must ensure that any agreements made under the Act adhere to the borrowing limit of $US 100,000,000. The Act also mandates that any promissory notes or securities issued must be for the specific purpose of the loan, and the proceeds must be used strictly for defence purposes. The Commonwealth is obligated to pay any amounts due under the agreements, including interest, out of the Consolidated Revenue Fund. Additionally, the Commonwealth must ensure that the agreements, promissory notes, securities, and payments are exempt from taxes, duties, fees, restrictions, charges, or other matters as stipulated in the Act. This includes compliance with the exemption clause despite any conflicting provisions in other laws.
Breaching the provisions of the Loan (Defence) Act 1970 can have significant consequences. While the Act does not explicitly state penalties or offences for non-compliance, any deviation from the specified borrowing limit or misuse of the proceeds could potentially lead to legal challenges or financial repercussions. The Act's primary focus is on ensuring the proper application of the borrowed funds for defence purposes and compliance with the defined exemptions. Therefore, any actions that contravene these stipulations could be subject to review or legal action under other applicable laws or regulations. The overarching aim of the Act is to maintain the integrity and purpose of the loan for defence, and adherence to its provisions is crucial to avoid any unintended legal or financial consequences.