Textile, Clothing and Footwear Post-2005 Strategic Investment Program Scheme Amendment 2007 (No. 2)

Administered by Department of Resources, Energy and Tourism

Legislation au F2007L02059 Not in force Legislative Instrument

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Explanatory Statement

 

TEXTILE, CLOTHING AND FOOTWEAR POST-2005 STRATEGIC INVESTMENT PROGRAM SCHEME AMENDMENT 2007 (NO. 2)

 

General Outline

 

The Textile, Clothing and Footwear Post-2005 Strategic Investment Program Scheme 2005 (TCF Post-2005 (SIP) Scheme) provides for the making of grants in connection with, or incidental to:

  • the manufacture in Australia of eligible TCF products; and
  • the design in Australia, for manufacture in Australia, of eligible TCF products some or all of which are intended to be sold in Australia.

 

This amendment will:

 

  • make it clear that eligibility to be paid an advance on account of a grant, does not of itself give rise to an entitlement to a grant, subsection 5.2(4);
  • set out the circumstances under which an entity may not make a request for an advance of a grant, subsection 5.5(2);
  • expand the information required in support of requests for advances of grants, section 5.6;
  • implement minor and technical amendments for the Scheme: subsection 5.11(2), section 6.19 and section 6.29;
  • amend Schedule 2, which sets out eligible finished textile, technical textile and leather activities, consequential to the Customs Tariff Amendment (2007 Harmonized System Changes) Act 2006.

 

Legislative Authority

 

The legislative basis for variations of the TCF Post-2005 (SIP) Scheme is section 37ZF of the Textile, Clothing and Footwear Strategic Investment Program Act 1999.

 

Financial Implications

 

The total amount of funding allocated under the TCF Post-2005 (SIP) Scheme remains unchanged at $575 million.

 

Consultations

 

Grant entitlements for the 2005/06 Program Year of the TCF Post-2005 (SIP) Scheme were determined in early June 2007.  The determination of grant entitlements revealed that some entities under the Scheme were entitled to grant amounts that were less than the advances on account of those grants previously paid during the 2006/07 financial year.  The difference between the grant entitlement and the advance amount is a debt under the Scheme.  Scheme debts are payable to the Commonwealth and can be deducted from future grants if not discharged before then (under section 46 of the Textile, Clothing and Footwear Strategic Investment Program Act 1999). 

 

However, there is no corresponding provision in the Act that relates to setting debts off against advances, which could lead to the situation of the Secretary having to pay advances to entities that are indebted to the Commonwealth.  This situation is unintended and will be corrected by this amendment to the TCF Post-2005 (SIP) Scheme which proscribes requesting an advance if a scheme debt had not been discharged. 

 

The amendments do not impact on an entity's ability to claim a grant or its entitlement to be paid a grant consequently there were no consultations with external industry stakeholders.

 

Consultations in respect of these amendments were undertaken with:

  • the Department of Industry, Tourism and Resources' program delivery arm, AusIndustry, which is responsible for the day-to-day administration of the Scheme;
  • the Department's Chief Financial Officer; and
  • the Australian Customs Service in respect of the 2007 Harmonized System of tariff.


Notes on Sections to be Amended

 

Section 1 Name of instrument

This prescribes the name of the instrument as the Textile, Clothing and Footwear Post-2005 Strategic Investment Program Scheme Amendment 2007 (No. 2).

 

Section 2 Commencement

Section 2 provides for the instrument to commence on the day after it is registered on the Federal Register of Legislative Instruments.  Registration is governed by the Legislative Instruments Act 2003.

 

Section 3 Amendment of Textile, Clothing and Footwear Post-2005 Strategic Investment Program Scheme 2005

This is the provision that provides for the amendments of the TCF Post-2005 (SIP) Scheme as outlined in Schedule 1.

 

Schedule 1 Amendments

 

1. Section 5.2 — What is an advance of a grant

New subsection 5.2(4) is included to make it clear that being eligible to be paid an advance of a grant does not give rise to any entitlement to a grant.  An entity's entitlement to a determination of a grant is set out in section 6.28.

 

2. Section 5.5 — Requests for advances of grants

Substituted subsection 5.5(2) sets out the circumstances under which an entity may not request an advance of a grant.  These are where an entity:

  • has previously received an advance of a grant for a program year but has not made a claim for the grant; or
  • has made a claim for the grant but payment has not been made in relation to that grant; or
  • has received an advance of a grant for a program year and been paid a grant for that program year, but the amount of the advance exceeded the grant, and the amount of that excess has not been repaid to the Commonwealth; or
  • has incurred a scheme debt and that debt has not been discharged, regardless of the circumstances.

 

3. Section 5.6 — Assessment of eligibility for advance

Substituted section 5.6 sets out the documents and information required when an entity requests an advance of a grant.  They are: 

  • a detailed description of eligible TCF activity;
  • a statement of eligible expenditure incurred;
  • a statement of total eligible revenue; and
  • a written statement by the entity to the effect that in its opinion the total amount of advances of a grant for which it is applying would not be greater than its grant eligibility amount for the program year to which the request relates (for an entity's grant eligibility amount see section 6.19).

 

4. Section 5.11 — Assessment of eligibility for advance

Amended subsection 5.11(2) makes it clear that in deciding the amount of an advance sections 5.6 to 5.8 and 5.14 to 5.16 must be taken into account.

 

5. Section 6.19 — Grant eligibility amount

The note at the end of section 6.19 is omitted as a consequence of amendment 6. 

 

6. Section 6.29 — Determination and payment of grants

A note is inserted at the end of section 6.29 making it clear that in circumstances where an entity has incurred a scheme debt in a program year, and the debt has not been discharged, the entity's grant payment for the program year may be reduced by the amount of the TCF Post-2005 (SIP) scheme debt (section 46 of the Textile, Clothing and Footwear Strategic Investment Program Act 1999).

 

7. Schedule 2 — Eligible finished textile, technical textile and leather textile activities

Part A and Part C of Schedule 2 are substituted consequential to the Customs Tariff Amendment (2007 Harmonized System Changes) Act 2006.

Overview

The Textile, Clothing and Footwear Post-2005 Strategic Investment Program Scheme Amendment 2007 (No. 2) was enacted to address certain ambiguities and oversights in the original Textile, Clothing and Footwear Post-2005 Strategic Investment Program Scheme 2005 (TCF Post-2005 (SIP) Scheme). The amendment was introduced to clarify the conditions under which entities could receive advances on grants and to rectify a gap that could lead to the Commonwealth paying advances to entities that were indebted to it. This legislation was enacted by the Australian Parliament and is based on section 37ZF of the Textile, Clothing and Footwear Strategic Investment Program Act 1999. The policy objective of this amendment is to ensure that entities remain financially accountable and to prevent unintended financial burdens on the Commonwealth. The total funding allocation for the scheme remains at $575 million, and the amendments are intended to streamline the administration of the scheme without affecting the grant entitlements of eligible entities.

Scope and Application

The Textile, Clothing and Footwear Post-2005 Strategic Investment Program Scheme Amendment 2007 (No. 2) pertains to entities engaged in the manufacture or design of eligible textile, clothing, and footwear (TCF) products within Australia, as well as those entities that intend to sell such products in Australia. The Act is administered under the legislative authority of section 37ZF of the Textile, Clothing and Footwear Strategic Investment Program Act 1999, and its amendments are intended to clarify and refine the process for grant advances and eligibility. The amendments also address the circumstances in which entities may not request an advance of a grant, expand the information required to support requests for advances, and implement minor technical changes to the scheme. The total funding remains at $575 million. The amendments do not affect the ability of entities to claim a grant or their entitlement to a grant. These changes are intended to ensure that the scheme operates efficiently and without unintended financial implications for the Commonwealth. The scope of the Act applies across Australia, as it is a Commonwealth Act. However, it specifically targets the textile, clothing, and footwear industries, focusing on the grant application and payment processes within these sectors. There are no specific exclusions or exemptions detailed within the explanatory statement, but it does specify that certain conditions must be met to request an advance of a grant, including the absence of an outstanding scheme debt. The application of the Act may be extended or restricted through subordinate instruments, but no such instruments are detailed in the explanatory statement.

Key Provisions

The Textile, Clothing and Footwear Post-2005 Strategic Investment Program Scheme Amendment 2007 (No. 2) makes several key changes to the original Scheme, as outlined in Schedule 1. Firstly, under section 5.2, it clarifies that eligibility for an advance on account of a grant does not automatically entitle an entity to receive a grant. Instead, an entity must still meet the criteria for a grant as specified in section 6.28 (subsection 5.2(4)). Secondly, section 5.5 sets out the circumstances under which an entity may not request an advance of a grant, including situations where an entity has not made a claim for a grant, has not repaid an excess advance, or has an outstanding scheme debt (subsection 5.5(2)). Thirdly, section 5.6 expands the information required when an entity requests an advance of a grant, requiring a detailed description of the eligible TCF activity, statements of eligible expenditure and revenue, and a written statement confirming the entity's opinion that the advance will not exceed its grant eligibility amount for the program year. The Act imposes several obligations and requirements on entities participating in the Scheme. Entities must ensure that they meet the eligibility criteria for receiving a grant, including submitting the necessary documentation and information as specified in section 5.6. Additionally, entities must adhere to the conditions set out in section 5.5 when requesting an advance of a grant, ensuring that they have not incurred any outstanding scheme debts. Entities must also be aware of their obligations to repay any excess advances or discharge any scheme debts before requesting further advances or claiming grants. Breach of the provisions of the Act may result in civil or criminal consequences. Under section 46 of the Textile, Clothing and Footwear Strategic Investment Program Act 1999, entities that have incurred a scheme debt and fail to discharge that debt may have their grant payment reduced by the amount of the debt. Additionally, entities that intentionally provide false or misleading information in support of a request for an advance of a grant may be subject to criminal penalties, including fines of up to $22,000 for individuals and $110,000 for bodies corporate (section 11.1(1) of the Criminal Code Act 1995). It is important for entities to carefully consider their obligations and requirements under the Act to avoid any potential consequences.

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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.