Non-government Schools (Loans Guarantee) Amendment Act 1981

Administered by Department of Education, Science and Training

Legislation au C2004A02538 Not in force Act

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Non-government Schools (Loans Guarantee) Amendment Act 1981

No. 161 of 1981

 

An Act to amend the Non-government Schools (Loans Guarantee) Act 1977, and for related purposes

[Assented to 19 November 1981]

BE IT ENACTED by the Queen, and the Senate and the House of Representatives of the Commonwealth of Australia, as follows:

Short title, &c.

1. (1) This Act may be cited as the Non-government Schools (Loans Guarantee) Amendment Act 1981.

(2) The Non-government Schools (Loans Guarantee) Act 19771 is in this Act referred to as the Principal Act.

Commencement

2. This Act shall come into operation on the day on which it receives the Royal Assent.


Interpretation

3. Section 3 of the Principal Act is amended—

(a) by inserting “, or proposed to be conducted,” after “conducted” (wherever occurring) in the definition of “non-government school”;

(b) by omitting “an institution” from the definition of “school” and substituting “a proposed school, or an institution or proposed institution”; and

(c) by omitting paragraph (a) of the definition of “school” and substituting the following paragraph:

“(a) a school or institution at which education is provided at a standard (however described) that is pre-school standard only or a proposed school or institution at which it is proposed that education be provided at a standard (however described) that is pre-school standard only; or”.

4. (1) Sections 5 and 6 of the Principal Act are repealed and the following section is substituted:

Guarantees

“5. (1) Subject to sub-section (2), the Treasurer may, on behalf of the Commonwealth, give to a person a guarantee of—

(a) the due payment of—

(i) the whole or a specified part of the repayments of principal moneys required to be made under an agreement for the loan of moneys by the person to the school authority of a non-government school, being principal moneys required, in whole or in part, for the purpose of expenditure on an approved project of the school; and

(ii) the whole or a specified part of any interest required to be paid under the agreement on those principal moneys; or

(b) the due payment of the whole or a specified part of the repayments of principal moneys of the kind referred to in sub-paragraph (a) (i).

“(2) The Treasurer shall not give a guarantee under this section in relation to an agreement of the kind referred to in sub-paragraph (1) (a) (i) unless the Minister has certified that—

(a) he considers that the terms and conditions of the agreement are satisfactory;

(b) he is satisfied that, in the absence of the guarantee, the school authority would not be able to obtain a loan of moneys, or to obtain a loan of moneys on satisfactory terms and conditions, for the purpose of expenditure on the approved project in relation to which the guarantee is to be given; and

(c) he considers that there will not be made available to the school authority, out of moneys provided, or to be provided, by the Commonwealth to the State in which the school is situated under any


Act that provides for the granting of financial assistance to the States, or to the States and the Northern Territory, for or in relation to schools, moneys that will be expended in the payment of—

(i) any part of the repayments of the principal moneys, or of the part of the repayments of principal moneys, as the case may be, in relation to which the guarantee is to be given; or

(ii) if the guarantee is also to be given in relation to the payment of interest, any part of the payments of interest, or of the part of the payments of interest, as the case may be, in relation to which the guarantee is to be given.

“(3) A guarantee under this section shall apply only in relation to principal moneys required by the school authority for the purpose of expenditure on the approved project in relation to which the guarantee is given and, if the guarantee is to apply in relation to the payment of interest, interest on such moneys.”.

(2) Notwithstanding the repeal of sections 5 and 6 of the Principal Act effected by sub-section (1), the provisions of sections 5 and 6 of the Principal Act continue to apply, after the commencement of this Act, to and in relation to a building project of a non-government school that was, before the commencement of this Act, approved under section 4 of the Principal Act for the purposes of that Act.

Recovery of any moneys paid by Commonwealth under a guarantee

5. Section 8 of the Principal Act is amended

(a) by inserting in sub-section (1) “or pays any interest owing on such moneys” after “lent to a school authority”; and

(b) by inserting in sub-section (1) “or that interest, as the case may be,” after “the amount of those moneys”.

 

NOTE

1. No. 106, 1977, as amended. For previous amendments, see No. 61, 1981.

Overview

The Non-government Schools (Loans Guarantee) Amendment Act 1981, enacted by the Queen, the Senate, and the House of Representatives of the Commonwealth of Australia, serves to amend the Non-government Schools (Loans Guarantee) Act 1977. This legislation addresses gaps in the financial support mechanisms for non-government schools, specifically targeting the guarantee of loans to school authorities for approved projects. The policy objective is to ensure that non-government schools can secure necessary financing for development, even in circumstances where private loans may not be readily available or may come with unsatisfactory terms. The Act thereby facilitates the financial stability and growth of non-government schools by providing a guarantee from the Commonwealth, subject to certain ministerial conditions being met. The enactment of this Act by the Australian Parliament aims to streamline the process by which non-government schools can access guaranteed loans, ensuring that the Commonwealth’s support is both targeted and effective. This legislative amendment not only seeks to enhance the operational capabilities of non-government schools but also reinforces the commitment to educational infrastructure and development across the non-government sector.

Scope and Application

The Non-government Schools (Loans Guarantee) Amendment Act 1981 amends the Non-government Schools (Loans Guarantee) Act 1977, primarily concerning the guarantees offered by the Commonwealth to support non-government schools' approved projects. This Act applies to non-government schools, including those that are proposed, and encompasses loans intended for specific educational expenditures. The Act operates within the Commonwealth jurisdiction, extending its provisions to facilitate financial support for schools across Australia. It does not explicitly exclude any particular entities or projects but stipulates conditions for eligibility, notably requiring certification by the Minister regarding the terms and conditions of the loans and the necessity of the guarantee. Furthermore, the Act allows for the Treasurer to provide guarantees for the due payment of principal and interest on loans made to school authorities for approved projects, subject to certain criteria. The Act also provides for the recovery of any moneys paid by the Commonwealth under a guarantee, including interest, from the relevant school authorities.

Key Provisions

The Non-government Schools (Loans Guarantee) Amendment Act 1981 makes several amendments to the Non-government Schools (Loans Guarantee) Act 1977 (Principal Act). Firstly, section 3 amends the definition of "non-government school" to include those schools that are proposed to be conducted (subsection 3(a)). Secondly, it amends the definition of "school" by removing the requirement that a school must be an institution, and instead allows for a proposed school or institution (subsection 3(b)). Lastly, it modifies the definition of "school" to include those institutions at which education is provided at a pre-school standard only, or is proposed to be provided at such a standard (subsection 3(c)). These changes ensure that the Act applies to a broader range of non-government schools. The Act imposes obligations on the parties involved, particularly the Treasurer and the Minister. The Treasurer may provide a guarantee for the due payment of repayments of principal moneys and interest under a loan agreement for an approved project of a non-government school (section 5(1)). However, the Treasurer cannot provide a guarantee unless the Minister certifies that the terms and conditions of the agreement are satisfactory, that the school authority would not be able to obtain a loan without the guarantee, and that there will not be any Commonwealth moneys available to pay the repayments or interest (section 5(2)). Additionally, the Act allows for the recovery of any moneys paid by the Commonwealth under a guarantee, as well as any interest owing on such moneys (section 8). The Act does not explicitly outline offences, penalties, or civil/criminal consequences for breach. However, the failure to comply with the conditions set out in section 5(2) for providing a guarantee could potentially result in legal action or other consequences for the parties involved. For example, if the Minister fails to certify the terms and conditions of the loan agreement as required, the Treasurer may not be able to provide the guarantee, which could impact the school's ability to obtain financing for the approved project. Additionally, if the Commonwealth is required to pay moneys under a guarantee and fails to recover those moneys, it could result in financial losses for the Commonwealth.

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