Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018

Administered by Department of Finance

Legislation au F2018L01340 Rules Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

Issued by the Authority of the Minister for Finance and the Public Service

 

Public Governance, Performance and Accountability Act 2013

 

Public Governance, Performance and Accountability (Relevant Company) Rule 2016

 

Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018

 

Section 85 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) provides the Finance Minister with the authority to form, or participate in forming a relevant company on behalf of the Commonwealth. Section 85 also authorises the Finance Minister, on behalf of the Commonwealth, to acquire shares in or become a member of a relevant company, in circumstances that would result in the relevant company becoming a Commonwealth company. A relevant company is a company of a kind prescribed, including its objects or proposed activities, by a rule. Section 101 of the PGPA Act provides that the Finance Minister may make rules by legislative instrument to prescribe matters giving effect to the Act. Relevant companies are prescribed in the Public Governance, Performance and Accountability (Relevant Company) Rule 2016 (the Relevant Company Rule).

 

The Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018 (the Amendment Rules) amend the Relevant Company Rule. This amendment provides the legislative authority for the Finance Minister, on behalf of the Commonwealth, to acquire shares in a relevant company that is limited by shares whose objects or proposed activities are to develop and maintain sovereign ship design and construction capabilities and to undertake shipbuilding projects and related activities.

 

Details of the Amendment Rules are set out at Attachment A. A Statement of Compatibility with Human Rights is at Attachment B.

 

The Amendment Rules are a legislative instrument for the purposes of the Legislation Act 2003.

 

The Amendment Rules will commence on the day after registration on the Federal Register of Legislation.

 

Consultation

 

In accordance with section 17 of the Legislation Act 2003, consultation has taken place with the Department of Defence.


Attachment A

 

Details of the Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018

 

Section 1 – Name

 

This section provides that the title of the instrument is the Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018 (the Amendment Rules).

 

Section 2 – Commencement

 

This section provides that the Amendment Rules commence on the day after they are registered on the Federal Register of Legislation.

 

Section 3 – Authority

 

This section provides that the Amendment Rules are made under the Public Governance, Performance and Accountability Act 2013 (PGPA Act).

 

Section 4 – Schedules

 

This section provides that the Public Governance, Performance and Accountability (Relevant Company) Rule 2016 is amended as set out in the Schedule to the Amendment Rules.

 

Schedule 1 – Amendments

 

Public Governance, Performance and Accountability (Relevant Company) Rule 2016

 

Item 1 – Section 5 (at the end of the table)

 

This item amends the table of relevant companies in section 5 of the Public Governance, Performance and Accountability (Relevant Company) Rule 2016 by adding a company that is limited by shares whose objects or proposed activities are to develop and maintain sovereign ship design and construction capabilities and to undertake shipbuilding projects and related activities.

 

This item provides the Finance Minister, on behalf of the Commonwealth, with authority under paragraph 85(1)(b) of the PGPA Act to acquire shares in a relevant company in circumstances that would result in the relevant company becoming a Commonwealth company. The Commonwealth’s involvement in the kind of company prescribed by the Amendment Rules would facilitate the development and sustainment of Australia’s naval shipbuilding capability.


Attachment B

 

Statement of Compatibility with Human Rights

 

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

 

The Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018 (the Amendment Rules) are 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 Public Governance, Performance and Accountability Act 2013 (PGPA Act) establishes a framework for regulating resource management by the Commonwealth and relevant entities. Section 101 of the PGPA Act provides that the Finance Minister may make rules by legislative instrument to prescribe matters giving effect to the Act.

 

The Amendment Rules amend the Public Governance, Performance and Accountability (Relevant Company) Rule 2016 to provide the Finance Minister, on behalf of the Commonwealth, with the legislative authority to acquire shares in a relevant company of the kind described below in circumstances that would result in the relevant company becoming a Commonwealth company. The relevant company prescribed by the Amendment Rules is of the kind:

  • that is limited by shares; and
  • with the objects or proposed activities to develop and maintain sovereign ship design and construction capabilities and to undertake shipbuilding projects and related activities.

 

Human rights implications

 

The Amendment Rules do not engage any of the applicable rights or freedoms.

 

Conclusion

 

The Amendment Rules are compatible with human rights as they do not raise any human rights issues.

 

 

 

 

Senator the Hon Mathias Cormann

Minister for Finance and the Public Service

 

Overview

The Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018 were introduced to amend the Public Governance, Performance and Accountability (Relevant Company) Rule 2016, under the authority of the Public Governance, Performance and Accountability Act 2013 (PGPA Act). The principal objective of this amendment was to provide the Finance Minister with the legislative power to acquire shares in a relevant company, thereby enabling the Commonwealth to become a shareholder. This specific authority is intended to facilitate the development and maintenance of Australia's naval shipbuilding capabilities by allowing the Commonwealth to invest in companies that focus on sovereign ship design, construction, and related shipbuilding projects. The Amendment Rules were developed following consultation with the Department of Defence and are compatible with human rights, as outlined in the Statement of Compatibility with Human Rights annexed to the Explanatory Statement. The Amendment Rules, made under section 101 of the PGPA Act, modify the existing Relevant Company Rule by adding a new category of companies, those limited by shares with the specified objects and activities, to the list of relevant companies. This legislative instrument was enacted by the Minister for Finance and the Public Service, with the aim of enhancing the Commonwealth's ability to support and sustain critical national infrastructure and capabilities. The Amendment Rules are set to commence on the day following their registration on the Federal Register of Legislation, ensuring a timely and effective implementation of the legislative changes.

Scope and Application

The Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018 amend the Public Governance, Performance and Accountability (Relevant Company) Rule 2016, extending the legislative authority of the Finance Minister to acquire shares in certain companies. Specifically, the rules allow the Finance Minister, on behalf of the Commonwealth, to acquire shares in a relevant company that is limited by shares and has objects or proposed activities related to the development and maintenance of sovereign ship design and construction capabilities, as well as undertaking shipbuilding projects and related activities. This amendment facilitates the Commonwealth's involvement in supporting Australia's naval shipbuilding capability. The amendment applies to companies meeting the specified criteria, with no stated exclusions, and is effective from the day after registration on the Federal Register of Legislation. The rules are compatible with human rights as they do not engage any applicable rights or freedoms, and the amendment does not introduce any new exemptions or thresholds beyond what is prescribed in the amended rule.

Key Provisions

The Public Governance, Performance and Accountability (Relevant Company) Amendment (2018 Measures No. 1) Rules 2018 (Amendment Rules) introduce amendments to the Public Governance, Performance and Accountability (Relevant Company) Rule 2016, enhancing the scope of the legislative authority of the Finance Minister. Section 85 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) empowers the Finance Minister to form or participate in forming a relevant company on behalf of the Commonwealth, or to acquire shares in or become a member of a relevant company, provided it results in the company becoming a Commonwealth company. The Amendment Rules specifically address companies limited by shares with objectives or proposed activities focused on developing and maintaining sovereign ship design and construction capabilities and undertaking shipbuilding projects and related activities (Schedule 1, Item 1). These changes ensure the Commonwealth can facilitate the development and sustainment of Australia’s naval shipbuilding capability. The obligations imposed by the Amendment Rules pertain to the Finance Minister’s actions in relation to relevant companies. Under the amended Relevant Company Rule, the Finance Minister is authorised to acquire shares in a relevant company, thereby enabling the Commonwealth to take control or a significant interest in the company (Schedule 1, Item 1). This authorisation extends to companies with specific activities related to shipbuilding and naval capabilities, ensuring that the Commonwealth can directly support and influence these critical sectors. The Amendment Rules provide the legislative backing necessary for the Finance Minister to exercise these powers effectively, in accordance with the provisions of the PGPA Act. Breach of the provisions in the Amendment Rules can lead to various consequences, although specific penalties are not detailed within the explanatory statement. Generally, under the PGPA Act, non-compliance with the rules or provisions could lead to legal actions, financial penalties, or other administrative consequences. The precise penalties would depend on the nature of the breach and the specific provisions of the PGPA Act and other relevant legislation. The Amendment Rules themselves do not specify maximum penalties but rely on the broader legal framework within which the PGPA Act operates. It is essential for parties involved to adhere to these provisions to avoid potential legal and financial repercussions.

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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.