Public Governance, Performance and Accountability (Investment) Authorisation 2024

Administered by Department of Finance

Legislation au F2024L01130 In force Legislative Instrument

Legislation content

EXPLANATORY STATEMENT

Issued by authority of the Minister for Finance

Public Governance, Performance and Accountability Act 2013

 

Public Governance, Performance and Accountability (Investment) Authorisation 2024

 

The Public Governance, Performance and Accountability Act 2013 (PGPA Act) sets out a framework for regulating resource management by Commonwealth entities and companies.

 

Section 59 of the PGPA Act permits corporate Commonwealth entities to invest money that is not immediately required for the purposes of the entity in certain types of investments prescribed in the Act as well as investments authorised by the Finance Minister in writing or in the rules.

 

Subparagraph 59(1)(b)(iii) of the PGPA Act provides that the Finance Minister may authorise forms of investment by corporate Commonwealth entities in writing. This instrument is made under subparagraph 59(1)(b)(iii) of the PGPA Act.

 

The existing instrument, the Public Governance, Performance and Accountability (Investment) Authorisation 2014 (the 2014 Authorisation), made under subparagraph 59(1)(b)(iii) sunsets on 1 October 2024. Most legislative instruments sunset 10 years after commencement under Chapter 3, Part 4 of the Legislation Act 2003.

 

This instrument the Public Governance, Performance and Accountability (Investment) Authorisation 2024 (the 2024 Authorisation) repeals and replaces the Public Governance, Performance and Accountability (Investment) Authorisation 2014.

 

The 2024 Authorisation reflects the National Housing Finance and Investment Corporation’s change in name to Housing Australia from 12 October 2023 as provided for in the Treasury Laws Amendment (Housing Measures No. 1) Act 2023.

Aside from this name change, the 2024 Authorisation retains the substantive forms of authorised investments of the 2014 Authorisation for the following 10 corporate Commonwealth entities:

 

  1.    Australian Broadcasting Corporation;
  2.    Export Finance and Insurance Corporation;
  3.    Grains Research and Development Corporation;
  4.    Rural Industries Research and Development Corporation;
  5.    Commonwealth Scientific and Industrial Research Organisation;
  6.     Civil Aviation Safety Authority;
  7.    Australian Hearing Services;
  8.    Australian Nuclear Science and Technology Organisation;
  9.      Airservices Australia;
  10.      Housing Australia.

 

Subsection 59(4), of the PGPA Act provides that authorisations made under subparagraph 59(1)(b)(iii) are legislative instruments that are not subject to disallowance under section 42 of the Legislative Instruments Act 2003.

 

Details of the 2024 Authorisation are set out at Attachment A.

 

The whole of the instrument commences the day after registration.

 

Statement of Compatibility with Human Rights

 

A Statement of Compatibility with Human Rights is not required for the 2024 Authorisation. Subsection 9(1) of the Human Rights (Parliamentary Scrutiny) Act 2011 requires a Statement of Compatibility with Human Rights for all legislative instruments subject to disallowance under section 42 of the Legislation Act 2003. As the 2024 Authorisation is exempt from disallowance under subsection 59(4) of the PGPA Act, a Statement of Compatibility with Human Rights is not required.

 

Consultation

 

The 2024 Authorisation was developed in consultation with the Australian Broadcasting Corporation, the Export Finance and Insurance Corporation, the Grains Research and Development Corporation, the Rural Industries Research and Development Corporation, the Commonwealth Scientific and Industrial Research Organisation, the Civil Aviation Safety Authority, Australian Hearing Services, the Australian Nuclear Science and Technology Organisation, Airservices Australia and Housing Australia.

 

The 2024 Authorisation was drafted by the Office of Parliamentary Counsel.

ATTACHMENT A

Details of the Public Governance, Performance and Accountability (Investment) Authorisation 2024

Part 1 – Preliminary

 

Section 1 – Name

 

This section states that the name of this instrument is the Public Governance, Performance and Accountability (Investment) Authorisation 2024 (2024 Authorisation).  

 

Section 2 – Commencement

 

This section provides that the whole of the instrument commences the day after registration.

 

Section 3 – Authority

 

This section provides that this instrument is made under subparagraph 59(1)(b)(iii) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

 

Section 4 – Schedules

 

This section provides that each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.

 

Section 5 – Definitions

 

approved bank

‘Approved bank’ is defined in the instrument as a person that carries on the business of banking in Australia the operations of which are subject to prudential supervision or regulation, under a law of the Commonwealth, a State or a Territory and the business of which has a Standard and Poor’s long-term rating of:

         for a Part other than Part 3 (Export Finance and Insurance Corporation) of the 2024 Authorisation—A‑ (or the Moody’s or Fitch’s equivalent) or better; and

         for Part 3—BBB‑ (or the Moody’s or Fitch’s equivalent) or better.

 

Standard and Poor’s is a private credit rating agency that issues credit ratings to companies and countries (and the debt they issue) on a scale of AAA to D, indicating their degree of investment risk. Definitions for Standard and Poor’s credit ratings can be found on their website. Fitch and Moody’s are also private credit rating agencies that issue credit ratings. Definitions for Fitch and Moody’s credit ratings can be found on their respective websites.

 

 

 

 

approved entity

‘Approved entity’ is defined in the instrument as an entity that operates inside or outside Australia and has a Standard and Poor’s long-term rating of AA- (or the Moody’s or Fitch’s equivalent) or better.

 

dematerialised security

‘Dematerialised security’ is defined in the instrument as a security that is deposited in the Austraclear system. Dematerialised securities are securities that exist (i.e are created, registered and traded) only in electronic form. Austraclear, Australia’s major central debt registry and settlement facility, introduced dematerialised securities in 1999 and since 2002, the Commonwealth has issued all new Treasury Bonds and Treasury Notes in the dematerialised form.

 

securities

‘Securities’ is defined in the instrument as:

 

         debentures, bonds, promissory notes, commercial paper, bills of exchange, certificates of deposit and fixed and floating rate notes issued under a senior debt program, and their dematerialised security equivalents; but

         does not include any instrument or document that is in the nature of equity, subordinate debt or hybrid equity.

 

senior debt program

‘Senior debt program’ means a program under which debt is issued and ranked ahead of other debt; and has priority if debt has to be redeemed in cases of liquidation.

 

Part 2 – The Australian Broadcasting Corporation

 

Section 6

 

This section provides that the Australian Broadcasting Corporation (the ABC) is authorised to invest relevant money for which they are responsible in:

         bills of exchange accepted or endorsed only by an approved bank;

         certificates of deposit with an approved bank.

 

They may also invest in dematerialised securities that are the equivalent of the above. Investments must be in the name of the ABC and denominated in Australian currency.

 

Part 3 – The Export Finance and Insurance Corporation

 

Subsection 7(1)

 

This subsection provides that the Export Finance and Insurance Corporation (EFIC) is authorised to invest relevant money for which EFIC is responsible in accordance with section 7.

 

 

Subsection 7(2)

 

This subsection provides that EFIC may invest money in one or more of the following ways:

         in securities issued by an approved bank;

         on deposit with, or in securities issued or guaranteed by, an approved entity.

 

Subsection 7(3)

 

This subsection provides that investments must be in the name of EFIC.

 

Subsection 7(4)

 

This subsection provides that subsections 5 to 7 apply if an investment:

         is securities issued by an approved bank; and

         has a Standard and Poor’s long-term rating lower than A- (or the Moody’s or Fitch’s equivalent).

 

Subsection 7(5)

 

This subsection provides that the investment together with any other such investments of EFIC in the approved bank, must not exceed 10% of the total investments of EFIC. This ensures that EFIC’s investments do not become overly concentrated in one approved bank.

 

Subsection 7(6)

 

This subsection provides that the investment, together with any other such investments of EFIC in any approved bank, must not exceed 25% of the total investments of EFIC.

 

Subsection 7(7)

 

This subsection provides that the investment:

         must not have a term longer than 3 years; and

         if the investment has a term longer than 6 months it must be able to be traded in the secondary market.

 

A secondary market is where investors purchase securities from other investors rather than from the issuing institution itself. The requirements in this subsection assist in ensuring that EFIC does not invest in illiquid investments.

 

Part 4 – The Grains Research and Development Corporation

 

Subsection 8(1)

 

This subsection provides that the Grains Research and Development Corporation (GRDC) is authorised to invest relevant money for which GRDC is responsible in accordance with section 8.

 

Subsection 8(2)

 

This subsection provides that the GRDC may invest in one or more of the following:

         bills of exchange accepted or endorsed only by an approved bank;

         certificates of deposit with an approved bank;

         floating rate notes issued by an approved bank under a senior debt program;

         11 am call deposits with an approved bank.

 

The GRDC may also invest in dematerialised securities that are equivalent to the above (with the exception of 11 am call deposits). 11 am call deposits are overnight deposit facilities where daily access to funds is provided as long as notice is provided by 11 am that funds are required.

 

Subsection 8(3)

 

This subsection provides that investments must be in the name of the GRDC and denominated in Australian currency.

 

Subsection 8(4)

 

This subsection provides that investments in floating rate notes issued by an approved bank under a senior debt program (or the equivalent in dematerialised securities) must not either cumulatively or singly exceed 20% of the total investments of the GRDC.

 

Part 5 – The Rural Industries Research and Development Corporation

 

Section 9

 

This section provides that the Rural Industries Research and Development Corporation (RIRDC) is authorised to invest relevant money for which they are responsible in bills of exchange accepted or endorsed only by an approved bank (or the equivalent in dematerialised securities). Investments must be in the name of the RIRDC and denominated in Australian currency.  

 

Part 6 – The Commonwealth Scientific and Industrial Research Organisation

 

Section 10

 

This section provides that the Commonwealth Scientific and Industrial Research Organisation (the CSIRO) is authorised to invest relevant money for which they are responsible in:

         bills of exchange accepted or endorsed only by an approved bank;

         certificates of deposit with an approved bank.

 

They may also invest in dematerialised securities that are the equivalent of the above. Investments must be in the name of the CSIRO and denominated in Australian currency.

 

Part 7 – The Civil Aviation Safety Authority 

 

Section 11

 

This section provides that the Civil Aviation Safety Authority (CASA) is authorised to invest relevant money for which they are responsible in:

         bills of exchange accepted or endorsed only by an approved bank;

         certificates of deposit with an approved bank.

 

They may also invest in dematerialised securities that are the equivalent of the above. Investments must be in the name of CASA and denominated in Australian currency.

 

Part 8 – Australian Hearing Services 

 

Section 12

 

This section provides that Australian Hearing Services is authorised to invest relevant money for which they are responsible in bills of exchange accepted or endorsed only by an approved bank (or the equivalent in dematerialised securities). Investments must be in the name of Australian Hearing Services and denominated in Australian currency.

 

Part 9 – The Australian Nuclear Science and Technology Organisation  

 

Section 13

 

This section provides that Australian Nuclear Science and Technology Organisation (ANSTO) is authorised to invest relevant money for which they are responsible in:

         bills of exchange accepted or endorsed only by an approved bank;

         certificates of deposit with an approved bank.

 

They may also invest in dematerialised securities that are the equivalent of the above. Investments must be in the name of ANSTO and denominated in Australian currency.

 

Part 10 – Airservices Australia   

 

Section 14

 

This section provides that Airservices Australia is authorised to invest up to $20 million of relevant money for which they are responsible in floating rate notes issued by an approved bank under a senior debt program (or the equivalent in dematerialised securities). The investments must be in the name of Airservices Australia and denominated in Australian currency.

 

Part 11 – Housing Australia

 

Subsection 15(1)

 

This subsection provides that Housing Australia is authorised to invest relevant money for which Housing Australia is responsible in accordance with section 15.

 

Subsection 15(2)

 

This subsection provides that Housing Australia may invest money in one or more of the following ways:

         in securities issued by an approved bank;

         on deposit with, or in securities issued or guaranteed by, an approved entity.

 

Subsection 15(3)

 

This subsection provides that investments must be in the name of Housing Australia.

 

Subsection 15(4)

 

This subsection provides that subsections 5 to 7 apply if an investment:

         is securities issued by an approved bank; and

         has a Standard and Poor’s long-term rating lower than A- (or the Moody’s or Fitch’s equivalent).

 

Subsection 15(5)

 

This subsection provides that the investment together with any other such investments of Housing Australia in the approved bank, must not exceed 10% of the total investments of Housing Australia. This ensures that Housing Australia’s investments do not become overly concentrated in one approved bank.

 

Subsection 15(6)

 

This subsection provides that the investment, together with any other such investments of Housing Australia in any approved bank, must not exceed 25% of the total investments of Housing Australia.

 

Subsection 15(7)

 

This subsection provides that the investment:

         must not have a longer term than 3 years; and

         if the investment has a term longer than 6 months it must be able to be traded in the secondary market.

 

A secondary market is where investors purchase securities from other investors rather than from the issuing institution itself. The requirements in this subsection assist in ensuring that Housing Australia does not invest in illiquid investments.

 

Schedule 1—Repeals

 

Public Governance, Performance and Accountability (Investment) Authorisation 2014

 

Item 1 – The whole of the instrument

This item would repeal the Public Governance, Performance and Accountability (Investment) Authorisation 2014.

 

Overview

The Public Governance, Performance and Accountability Act 2013 (PGPA Act) establishes a framework for managing resources within Commonwealth entities and companies. To address the need for flexibility in investment practices by corporate Commonwealth entities, Section 59 of the PGPA Act allows these entities to invest funds not immediately needed for their purposes in specific types of investments prescribed in the Act, or in investments authorised by the Minister for Finance. The Public Governance, Performance and Accountability (Investment) Authorisation 2024, made under subparagraph 59(1)(b)(iii) of the PGPA Act, serves to update and replace the previous authorisation from 2014. This new authorisation aligns with the recent renaming of the National Housing Finance and Investment Corporation to Housing Australia, effective from 12 October 2023, as stipulated in the Treasury Laws Amendment (Housing Measures No. 1) Act 2023. The 2024 Authorisation retains the same investment authorisations as the 2014 Authorisation for ten specified corporate Commonwealth entities, ensuring continuity in investment practices while accommodating the name change of one of the entities. This legislative instrument is exempt from disallowance under subsection 59(4) of the PGPA Act, and thus, does not require a Statement of Compatibility with Human Rights as mandated by subsection 9(1) of the Human Rights (Parliamentary Scrutiny) Act 2011. Developed in consultation with the relevant entities, the 2024 Authorisation was drafted by the Office of Parliamentary Counsel and will commence the day after registration.

Scope and Application

The Public Governance, Performance and Accountability (Investment) Authorisation 2024 applies to ten specified corporate Commonwealth entities, including the Australian Broadcasting Corporation, Export Finance and Insurance Corporation, Grains Research and Development Corporation, Rural Industries Research and Development Corporation, Commonwealth Scientific and Industrial Research Organisation, Civil Aviation Safety Authority, Australian Hearing Services, Australian Nuclear Science and Technology Organisation, Airservices Australia, and Housing Australia. The legislation sets out the types of investments these entities can make with money that is not immediately required for their purposes, in accordance with the Public Governance, Performance and Accountability Act 2013. The 2024 Authorisation replaces the 2014 Authorisation, which sunset on 1 October 2024. This instrument does not require a Statement of Compatibility with Human Rights as it is exempt from disallowance under subsection 59(4) of the PGPA Act. The 2024 Authorisation reflects the change in name of the National Housing Finance and Investment Corporation to Housing Australia. The geographic reach of the Act is national as it applies to Commonwealth entities, which operate across Australia. There are no stated exclusions, exemptions, or thresholds in the 2024 Authorisation. However, some entities have specific restrictions on the types and amounts of investments they can make, as outlined in the various Parts of the instrument. The 2024 Authorisation extends or restricts application through subordinate instruments, as it specifies the types of investments that each entity can make.

Key Provisions

The Public Governance, Performance and Accountability (Investment) Authorisation 2024 (2024 Authorisation) is made under subparagraph 59(1)(b)(iii) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and authorises specific types of investments for ten corporate Commonwealth entities. This instrument replaces the Public Governance, Performance and Accountability (Investment) Authorisation 2014, which sunsets on 1 October 2024. The 2024 Authorisation includes a name change from National Housing Finance and Investment Corporation to Housing Australia, reflecting the change in the entity's name under the Treasury Laws Amendment (Housing Measures No. 1) Act 2023. The entities covered by the 2024 Authorisation are the Australian Broadcasting Corporation, Export Finance and Insurance Corporation, Grains Research and Development Corporation, Rural Industries Research and Development Corporation, Commonwealth Scientific and Industrial Research Organisation, Civil Aviation Safety Authority, Australian Hearing Services, Australian Nuclear Science and Technology Organisation, Airservices Australia, and Housing Australia. The authorisations for each entity specify the types of investments they are permitted to make, ensuring that these investments meet certain criteria such as credit ratings, concentration limits, and liquidity requirements. For instance, the Australian Broadcasting Corporation is authorised to invest in bills of exchange and certificates of deposit issued by approved banks, while the Export Finance and Insurance Corporation can invest in securities issued by approved banks, with specific limits on concentration and term length. The 2024 Authorisation imposes several obligations on the entities it governs. These include maintaining investments in the name of the respective entity, ensuring that investments are denominated in Australian currency, adhering to concentration limits to avoid over-reliance on any single bank, and ensuring that investments meet certain liquidity standards. For example, the Export Finance and Insurance Corporation must ensure that investments in any single approved bank do not exceed 10% of its total investments, and any investment in securities with a term longer than 6 months must be tradable in the secondary market. Breaches of the 2024 Authorisation may result in legal consequences for the entities involved. While the 2024 Authorisation itself does not specify particular offences or penalties, the underlying PGPA Act provides a framework under which non-compliance could lead to administrative or legal actions. For instance, entities that fail to comply with the authorisations may face scrutiny from the Australian National Audit Office or other relevant authorities, potentially leading to financial penalties or other corrective measures. It is important for entities to adhere strictly to the authorisations to avoid any potential repercussions.

Legal classification tags

Area of Law
Corporate Law & Governance
Finance & Banking Law
Instrument
Regulation
Concepts
Definitions & Interpretation
Reporting & Disclosure Obligations
Regulatory Standards

Interactions

Authorises

All Versions

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.