Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 2025

Administered by Department of Infrastructure, Transport, Regional Development, Communications, Sport and the Arts

Legislation au F2025L00770 In force Legislative Instrument

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EXPLANATORY STATEMENT

Issued by authority of the Assistant Minister for Productivity, Competition, Charities and Treasury  

Local Government (Financial Assistance) Act 1995

Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 2025

Subsection 8(1) of the Local Government (Financial Assistance) Act 1995 (the Act) provides that the Treasurer must, not later than 30 June in each financial year, determine the final factor for that financial year.

Further, paragraph 7(3)(b) of the Act provides that the Treasurer must, before the start of each financial year, make an estimate of the final factor for that year.

The Act established the current process for the provision of Commonwealth financial assistance to local government through the states and territories. Each year, the level of financial assistance available to the states and territories for local government purposes is indexed by a factor which is to be estimated, and then finally determined, by the Treasurer. The Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 2025 (the Determination) determines the final factor for the 2024-25 financial year and the estimated factor for the 2025-26 financial year.

In accordance with section 19 of the Acts Interpretation Act 1901, any Minister in the Treasury portfolio may determine the factors under the Act.

No consultation has been undertaken on this Determination as the Determination is machinery in nature. In accordance with the Act, copies of the Determination will be made available to the Treasurer of each of the states and territories.

Details of the Determination are set out in Attachment A.

The Determination is a legislative instrument for the purposes of the Legislation Act 2003. However, this Determination is not subject to disallowance and sunsetting due to the operation of subsections 44(1) and 54(1) of the Legislation Act 2003. The enabling legislation facilitates the operation of an intergovernmental scheme involving the Commonwealth providing financial assistance to local government through the states and territories. The enabling legislation authorises the Determination to be made for the purposes of this arrangement. The factors determined by the Determination are largely mechanical in nature and have been derived from statistics published by the Australian Statistician.

A Policy Impact Analysis is not required as the Determination is machinery in nature.

The Determination commenced immediately after it was registered on the Federal Register of Legislation.

A Statement of Compatibility with Human Rights is at Attachment B.

ATTACHMENT A

Details of the Local Government (Financial Assistance) (Final Factor 2024-25 and Estimated Factor for 2025-26) Determination 2025

Section 1 – Name

This section provides that the name of the instrument is the Local Government (Financial Assistance) (Final Factor 2024-25 and Estimated Factor for 2025-26) Determination 2025 (the Determination).

Section 2 – Commencement

This section prescribes that the Determination commences the day after the Determination is registered.

Section 3 – Authority

This section provides that the Determination is made under the Local Government (Financial Assistance) Act 1995.

Section 4 – Definitions

This section provides definitions for the purposes of the Determination.

Sections 5 and 6 – Final factor for the year 2024-25

Section 5 provides the determined final factor in relation to the 2024-25 financial year.

Section 6 provides the details for how the final factor for the 2024-25 financial year was worked out.

Sections 7 and 8 – Estimated factor for the year 2025-26

Section 7 provides the estimated factor for the 2025-26 financial year.

Section 8 provides the details for how the estimated factor for the 2025-26 financial year was worked out.


ATTACHMENT B

 

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 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 Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 2025 (the Legislative Instrument) determines the final factor for the 2024-25 financial year and the estimated factor for the 2025-26 financial year. The factors are used to determine the amount of Commonwealth financial assistance which is made available to local government for a financial year.

Human rights implications

This Legislative Instrument does not engage any of the applicable rights or freedoms.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.

Overview

The Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 2025 was introduced to address the need for the annual indexing of Commonwealth financial assistance to local governments through the states and territories, as required by the Local Government (Financial Assistance) Act 1995. Enacted by a Minister in the Treasury portfolio, this Determination sets the final factor for the 2024-25 financial year and estimates the factor for the 2025-26 financial year, facilitating the ongoing financial support mechanism established by the Act. The Determination, which is machinery in nature and not subject to disallowance or sunsetting, ensures that the levels of financial assistance are indexed according to relevant statistical data. This process helps maintain the integrity of the intergovernmental financial assistance scheme, ensuring that local governments receive the necessary support in a manner consistent with the legislative framework.

Scope and Application

The Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 2025 applies to the Commonwealth, states, and territories in the context of providing financial assistance to local government. It is a legislative instrument made under the Local Government (Financial Assistance) Act 1995, which facilitates the Commonwealth's role in providing financial assistance to local governments through the states and territories. The Act applies to the Commonwealth government, state and territory governments, and local government authorities in Australia. The geographic reach of the Act is national, involving intergovernmental collaboration. The Determination specifies the final factor for the 2024-25 financial year and the estimated factor for the 2025-26 financial year, which are used to index the level of financial assistance provided to local governments. The Determination is made under the authority of the Assistant Minister for Productivity, Competition, Charities and Treasury, and is not subject to disallowance or sunsetting provisions under the Legislation Act 2003. The Act does not explicitly state any exclusions, exemptions, or thresholds, but the Determination itself provides specific numeric values for the factors. The Determination is machinery in nature, and no consultation was undertaken as it pertains to the mechanical aspects of the financial assistance scheme.

Key Provisions

The Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 2025 (the Determination) under the Local Government (Financial Assistance) Act 1995 sets out the final factor for the 2024-25 financial year and the estimated factor for the 2025-26 financial year (sections 5 and 7). This Determination is made under the authority of the Act, specifically under section 8(1), which requires the Treasurer to determine the final factor by 30 June of each financial year, and section 7(3)(b), which mandates an estimate before the start of each financial year (sections 3 and 4). The Determination specifies these factors based on calculations derived from statistics provided by the Australian Statistician, ensuring consistency and transparency in the financial assistance provided to local governments through the states and territories. Under this Determination, the primary obligation lies with the Treasurer to calculate and publish these factors by the specified deadlines. The states and territories, as recipients of the financial assistance, must then use these factors to determine their allocations. This process ensures that local governments receive their due financial support from the Commonwealth, as indexed annually. The Determination also specifies the method by which these factors are calculated, providing a clear framework for future determinations (sections 6 and 8). There are no specific offences, penalties, or consequences outlined in the Determination itself for non-compliance with the set factors or timelines. However, the Act and the broader legislative framework under which the Determination operates could impose sanctions for broader breaches in financial assistance provisions. The Determination is designed to be largely mechanical and does not engage with any human rights issues, as outlined in the Statement of Compatibility with Human Rights (Attachment B). This means that while the Determination itself does not provide for penalties, failure to adhere to the requirements set out in the Act could potentially lead to legal repercussions under the broader legislative scheme.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.