Loan (Defence) (No. 2)
No. 127 of 1970
An Act to Authorize the Raising and Expending of a certain sum of Money for Defence Purposes.
[Assented to 11 November 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 (No. 2) 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 $US125,000,000.
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 and twenty-five 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 the 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 (No. 2) 1970 was enacted by the Australian Parliament to facilitate the raising and expenditure of a specific sum of money for defence purposes. This legislation was introduced to address a financial gap required for defence initiatives, enabling the Commonwealth to borrow up to $US125,000,000 in US currency. Authorised under this Act, the borrowing can be carried out through agreements that may involve the issuance of promissory notes or other securities, with the funds to be applied exclusively for defence purposes. Additionally, the Act exempts these financial transactions from various taxes, duties, fees, and restrictions, ensuring the smooth execution of the defence-related financial activities. The policy objective underpinning this Act is to provide a structured and legally sound framework for the Commonwealth to meet its defence funding requirements effectively.
Scope and Application
The Loan (Defence) Act (No. 2) 1970 pertains to the Commonwealth of Australia's authority to borrow a specified sum of money for defence purposes, specifically US$125,000,000. This Act applies to the Commonwealth and allows for the raising of funds through agreements that may include the issuance of promissory notes or other securities. The proceeds from these loans are intended solely for defence purposes and must be paid out of the Consolidated Revenue Fund. The Act provides that any such agreements, notes, or securities issued under its authority are exempt from any taxes, duties, fees, restrictions, charges, or other matters, regardless of any conflicting provisions in other Commonwealth, State, or Territory laws. Additionally, the National Debt Sinking Fund Act 1966–1967 does not apply to the moneys borrowed under this Act. The scope of the Act is confined to the Commonwealth's borrowing needs for defence and does not extend beyond the specified amount or purpose.
Key Provisions
The Loan (Defence) Act (No. 2) 1970 (the Act) primarily serves to authorise the borrowing of up to $US125,000,000 for defence purposes by the Commonwealth of Australia. Under section 4, the Act grants the Commonwealth the authority to borrow this specified sum in United States currency. Section 5 provides that any agreement made under the authority of this Act can include provisions for the issuance of promissory notes or other securities to represent the borrowed funds. These securities may be issued by or on behalf of the Commonwealth. Section 6 permits the use of the loan proceeds for defence purposes, meaning the funds raised can be allocated for activities directly related to the defence of Australia. Any payments made under these agreements, including interest, are to be made from the Consolidated Revenue Fund, as specified in section 7. This appropriation ensures that the funds are sourced and managed in accordance with the fiscal regulations governing the Commonwealth.
The Act imposes certain obligations on the parties involved in the borrowing and lending process. Under section 8, any agreement made under this Act can include provisions that exempt the agreement, related matters, promissory notes, securities, or payments from any taxes, duties, fees, restrictions, charges, or other impositions, regardless of other applicable laws. This broad exemption clause ensures that the borrowing process remains unencumbered by extraneous financial obligations. Section 9 explicitly states that the National Debt Sinking Fund Act 1966–1967 does not apply to the moneys borrowed under agreements made under this Act. This means that the funds borrowed under this Act are not subject to the provisions of the National Debt Sinking Fund Act, allowing for a more flexible management of the borrowed funds.
The Act does not explicitly detail offences, penalties, or civil/criminal consequences for breach. However, the obligations and exemptions outlined in the Act implicitly set the framework for compliance. Breaches of the terms set out in agreements made under this Act, such as failing to issue securities as agreed, or misapplying the loan funds for non-defence purposes, could potentially lead to legal actions or administrative penalties. While the Act itself does not specify maximum penalties, breaches of financial agreements and mismanagement of funds could attract legal consequences under other relevant legislation or administrative regulations.