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2022-2023
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
AUSTRALIAN RESEARCH COUNCIL AMENDMENT (REVIEW RESPONSE) BILL 2023
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Education, the Hon Jason Clare MP)
OUTLINE ................................................................................................................................. 2
FINANCIAL IMPACT STATEMENT.................................................................................. 4
CONSULTATION ................................................................................................................... 4
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS .................................... 5
NOTES ON CLAUSES............................................................................................................ 9
SCHEDULE 1--OBJECT OF ACT..................................................................................... 10
SCHEDULE 2--AUSTRALIAN RESEARCH COUNCIL BOARD AND CEO ............ 12
SCHEDULE 3--FUNDING OF RESEARCH .................................................................... 27
SCHEDULE 4--REPORTING ............................................................................................ 49
SCHEDULE 5--TRANSITIONAL RULES ....................................................................... 51
1
AUSTRALIAN RESEARCH COUNCIL AMENDMENT (REVIEW RESPONSE) BILL 2023
OUTLINE
The Australian Research Council Amendment (Review Response) Bill 2023 (the Bill) amends
the Australian Research Council Act 2001 (ARC Act) to enhance the Australian Research
Council's (ARC) role to better support Australia's dynamic research landscape. The
amendments in the Bill are in response to the Final Report of the Trusting Australia's Ability:
Review of the Australian Research Council Act 2001 (Review) which made 10
recommendations, including to amend the ARC Act to:
• provide greater clarity of the ARC's purpose and functions,
• strengthen governance and accountability arrangements by establishing an
Australian Research Council Board (the Board), and
• reduce legislative burden and increase accounting flexibility to fund research
programs.
Schedules 1 and 2 to the Bill implement recommendations 1 and 2 of the Review by
amending the ARC Act to describe in the object of the Act the role and mission of the ARC,
with a stronger focus on its impact and purpose. The amended object of the ARC Act is to
establish a national body to, amongst other activities, support Australian universities in
conducting excellent research, promote and conduct activities to shape and foster the
national research landscape and community, and to administer funding to research
programs that will result in economic, social and community outcomes for Australia. The
ARC is committed to ensuring that support for academic career pathways is considered in its
processes including consideration of equity and diversity in the research workforce and
participation by all researchers, including First Nations peoples, women, and early and mid-
career researchers.
Schedule 2 to the Bill also implements recommendation 6 of the Review by amending the
ARC Act to establish the Board for the purpose of ensuring the independence and integrity
of the ARC and its decision-making processes. The Board, to be appointed by the Minister of
Education (Minister), will comprise of an appropriate mix of skills-based appointees with
sector experience, industry and governance experience, and broader social and economic
perspectives to be able to support Australia's world-class research effort. In addition, in
appointing the Chair, the Minister must also be satisfied that the Chair has professional
credibility and significant standing in one or more fields of research or in the management
of research. Under the Public Governance, Performance and Accountability Act 2013, the
Board will be the accountable authority of the ARC, ensuring responsibility for the key
governance of the ARC, and each member of the Board will be an official for the purposes of
that Act.
While not in the Bill, the Minister for Education will consult with the Minister for Industry
and Science on membership of the Board, prior to seeking agreement for these significant
2
appointments as set out in the Commonwealth Government Cabinet Handbook. The
Minister for Education will also consult the Minister for Industry and Science on emerging
research needs and innovation policy priorities.
In implementing recommendation 7 of the Review, the Board will appoint the Chief
Executive Officer (CEO) of the ARC who will be responsible for the ARC's day-to-day
operations and to assist the Board in the performance of its functions. The Board will also
establish and appoint members to the College of Experts and other committees as it deems
beneficial for the effective functioning of the ARC.
Schedule 3 to the Bill amends the funding arrangements currently set out in Part 7 of the
ARC Act. Significantly, under the new arrangements, the Board will approve grants of
financial assistance for research projects in relation to research programs under the
National Competitive Grants Program (NCGP), except for decisions to approve grants of
financial assistance for designated research programs which will be made by the Minister.
Board decisions will be made in accordance with the funding rules made by the Minister and
after considering advice following expert and peer review processes. This will better align
the ARC's funding of research to comparable research agencies within Australia and
internationally, reflecting recommendation 5 of the Review. Decisions to approve grants will
be based on research excellence and sound due diligence. The Minister will continue to
make funding rules consistent with the requirements in the ARC Act and the
Commonwealth Grants Rules and Guidelines. This enables the Minister to implement
priorities within the ARC allocations and grant assessment processes, and to rebalance the
focus of the ARC between basic and applied areas of research.
The Minister will approve grants for designated research programs to recognise their role in
creating research capability rather than programs that award individual research grants.
These are programs currently in the ARC Centres of Excellence scheme, the Industrial
Transformation Training Centres scheme, the Industrial Transformation Research Hubs
scheme, and in future, will include other research programs specified by the Minister in a
legislative instrument made under the ARC Act.
In implementing recommendation 5 of the Review, if there are reasons relevant to the
security, defence or international relations of Australia that a grant to an organisation
should not be approved, or should be terminated, the Minister is empowered to do so. If
this happens, the Minister may recover a specified amount of the grant that was paid to the
organisation. The Bill also strengthens research integrity measures to support the ARC's
functions, reflecting recommendation 2 of the Review. Organisations will be required to
enter into funding agreements with the CEO to receive financial assistance and the CEO is
able to terminate an agreement if the organisation breaches a term or condition. The Board
and the Minister may terminate a funding approval for breach of an agreement. If an
organisation's agreement or approval is terminated, there are new powers for the recovery
of grant amounts, including the ability to set-off a debt to the Commonwealth against any
future payments made under the Act. These are appropriate assurance and integrity
3
mechanisms that will allow the ARC to ensure that Commonwealth funding is being spent as
intended.
Schedule 3 to the Bill also implements recommendation 9 of the Review by amending the
current funding arrangements in the ARC Act to enable greater flexibility for the future.
Specifically, the capped special appropriation for research funding is replaced with a
provision for annual appropriation, which will reduce the burden of annually updating the
capped funding amounts through legislative amendments. The Bill will further simplify the
funding arrangements by removing the requirement to divide funding between different
categories of research programs.
Schedule 4 to the Bill specifies new requirements for the ARC annual report and Schedule 5
to the Bill enables the Minister to make, by legislative instrument, transitional rules relating
to amendments made by the Bill.
FINANCIAL IMPACT STATEMENT
The measures contained in the Bill, which establish the ARC Board as the accountable
authority and restructures the ARC's governance arrangements, will cost approximately $1.5
million per annum (approximately $0.6 million per annum of direct costs from the
establishment of the Board and $0.9 million to support the governance processes). These
costs will be met from existing resourcing through reprioritisation from within the ARC's
current annual departmental budget with zero net financial impact.
CONSULTATION
The panel conducting the Review (Review Panel) released a consultation paper on 9
November 2022 and invited public submissions. Submissions closed on 14 December 2022.
A total of 223 submissions were received from stakeholders in response to the consultation
paper. The Review Panel also held targeted consultations with stakeholders through
meetings and focus groups.
The Government response to the Review was announced on 22 August 2023. The
Government agreed, or agreed in principle, to all 10 recommendations of the Review.
The Australian Government Department of Education (the department) conducted further
consultations on the proposed amendments to the ARC Act with higher education research
peak bodies and representative groups, and across Government. Interested parties were
also invited to contribute through this consultation. Eleven formal submissions were
received which have informed the final policy settings and development of the Bill.
Throughout the development of the Bill, the department has worked closely with the
Department of the Prime Minister and Cabinet, the Attorney-General's Department, the
Department of Finance, the Department of Home Affairs, the Department of Industry,
Science and Resources, and the ARC.
4
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Australian Research Council Amendment (Review Response) Bill 2023
The Australian Research Council Amendment (Review Response) Bill 2023 (the Bill) 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 Bill
The Australian Research Council Amendment (Review Response) Bill 2023 (the Bill) amends
the Australian Research Council Act 2001 (ARC Act) to enhance the Australian Research
Council's (ARC) role to better support Australia's dynamic research landscape. The
amendments in the Bill are in response to the Final Report of the Trusting Australia's Ability:
Review of the Australian Research Council Act 2001 (Review) which made 10
recommendations, including to amend the ARC Act to:
• provide greater clarity of the ARC's purpose and functions,
• strengthen governance and accountability arrangements by establishing an
Australian Research Council Board (the Board), and
• reduce legislative burden and increase accounting flexibility to fund research
programs.
Schedules 1 and 2 to the Bill implement recommendations 1 and 2 of the Review by
amending the ARC Act to describe in the object of the Act the role and mission of the ARC,
with a stronger focus on its impact and purpose. The amended object of the ARC Act is to
establish a national body to, amongst other activities, support Australian universities in
conducting excellent research, promote and conduct activities to shape and foster the
national research landscape and community, and to administer funding to research
programs that will result in economic, social and community outcomes for Australia. The
ARC is committed to ensuring that support for academic career pathways is considered in its
processes including consideration of equity and diversity in the research workforce and
participation by all researchers, including First Nations peoples, women, and early and mid-
career researchers.
Schedule 2 to the Bill also implements recommendation 6 of the Review by amending the
ARC Act to establish the Board for the purpose of ensuring the independence and integrity
of the ARC and its decision-making processes. The Board, to be appointed by the Minister of
Education (Minister), will comprise of an appropriate mix of skills-based appointees with
sector experience, industry and governance experience, and broader social and economic
perspectives to be able to support Australia's world-class research effort. In addition, in
appointing the Chair, the Minister must also be satisfied that the Chair has professional
credibility and significant standing in one or more fields of research or in the management
of research. Under the Public Governance, Performance and Accountability Act 2013, the
5
Board will be the accountable authority of the ARC, ensuring responsibility for the key
governance of the ARC, and each member of the Board will be an official for the purposes of
that Act.
While not in the Bill, the Minister for Education will consult with the Minister for Industry
and Science on membership of the Board, prior to seeking agreement for these significant
appointments as set out in the Commonwealth Government Cabinet Handbook. The
Minister for Education will also consult the Minister for Industry and Science on emerging
research needs and innovation policy priorities.
In implementing recommendation 7 of the Review, the Board will appoint the Chief
Executive Officer (CEO) of the ARC who will be responsible for the ARC's day-to-day
operations and to assist the Board in the performance of its functions. The Board will also
establish and appoint members to the College of Experts and other committees as it deems
beneficial for the effective functioning of the ARC.
Schedule 3 to the Bill amends the funding arrangements currently set out in Part 7 of the
ARC Act. Significantly, under the new arrangements, the Board will approve grants of
financial assistance for research projects in relation to research programs under the
National Competitive Grants Program (NCGP), except for decisions to approve grants of
financial assistance for designated research programs which will be made by the Minister.
Board decisions will be made in accordance with the funding rules made by the Minister and
after considering advice following expert and peer review processes. This will better align
the ARC's funding of research to comparable research agencies within Australia and
internationally, reflecting recommendation 5 of the Review. Decisions to approve grants will
be based on research excellence and sound due diligence. The Minister will continue to
make funding rules consistent with the requirements in the ARC Act and the
Commonwealth Grants Rules and Guidelines. This enables the Minister to implement
priorities within the ARC allocations and grant assessment processes, and to rebalance the
focus of the ARC between basic and applied areas of research.
The Minister will approve grants for designated research programs to recognise their role in
creating research capability rather than programs that award individual research grants.
These are programs currently in the ARC Centres of Excellence scheme, the Industrial
Transformation Training Centres scheme, the Industrial Transformation Research Hubs
scheme, and in future, will include other research programs specified by the Minister in a
legislative instrument made under the ARC Act.
In implementing recommendation 5 of the Review, if there are reasons relevant to the
security, defence or international relations of Australia that a grant to an organisation
should not be approved, or should be terminated, the Minister is empowered to do so. If
this happens, the Minister may recover a specified amount of the grant that was paid to the
organisation. The Bill also strengthens research integrity measures to support the ARC's
functions, reflecting recommendation 2 of the Review. Organisations will be required to
6
enter into funding agreements with the CEO to receive financial assistance and the CEO is
able to terminate an agreement if the organisation breaches a term or condition. The Board
and the Minister may terminate a funding approval for breach of an agreement. If an
organisation's agreement or approval is terminated, there are new powers for the recovery
of grant amounts, including the ability to set-off a debt to the Commonwealth against any
future payments made under the Act. These are appropriate assurance and integrity
mechanisms that will allow the ARC to ensure that Commonwealth funding is being spent as
intended.
Schedule 3 to the Bill also implements recommendation 9 of the Review by amending the
current funding arrangements in the ARC Act to enable greater flexibility for the future.
Specifically, the capped special appropriation for research funding is replaced with a
provision for annual appropriation, which will reduce the burden of annually updating the
capped funding amounts through legislative amendments. The Bill will further simplify the
funding arrangements by removing the requirement to divide funding between different
categories of research programs.
Schedule 4 to the Bill specifies new requirements for the ARC annual report and Schedule 5
to the Bill enables the Minister to make, by legislative instrument, transitional rules relating
to amendments made by the Bill.
Human rights implications
The Bill engages the following rights:
• the right to work - Article 6 of the International Covenant on Economic, Social and
Cultural Rights (ICESCR)
• the right to education - Article 13 of the ICESCR, and
• the right to enjoy the benefits of scientific progress and its applications - Article
15(b) of the ICESCR.
Right to work
The Bill engages the right to work as set out in Article 6 of the ICESCR. Article 6(1) of the
ICESCR recognises "the right of everyone to the opportunity to gain [their] living by work"
and that the State will "take appropriate steps to safeguard this right". Article 6(2) cites
"technical and vocational guidance and training programmes, policies and techniques to
achieve steady economic, social and cultural development and full and productive
employment under conditions safeguarding fundamental political and economic freedoms
to the individual" as steps to be taken by a State Party to achieve the full realisation of the
right contained in Article 6(1).
The amendments in the Bill to streamline the provision of research funding promote the
right to work by supporting the careers of researchers in achieving outcomes that will
potentially benefit the research sector in Australia and internationally. The amendments
enhance the ARC's role in supporting and promoting a well-functioning research system,
7
thus enabling Australian universities to attract and retain researchers. The ARC Board's and
the Minister's assessment of applications for a grant of financial assistance for a research
project in relation to a research program will be driven by expert and peer review processes
to identify talent and foster new opportunities, which can determine the career pathways of
researchers. Increasing Australia's research capacity results in not only the development of
new technologies, products and ideas, economic growth and an enhanced quality of life in
Australia, but also the creation of jobs.
Right to education
The Bill engages the right to education, which is set out in Article 13 of the ICESCR. Article 13
recognises the important personal, societal, economic, and intellectual benefits of
education. Article 13 also provides that secondary education in all its different forms,
including higher education, shall be made generally available and accessible to all by every
appropriate means.
The ARC has a significant role within the higher education sector, helping to attract and
retain academics and driving pure basic and strategic basic research within Australian
universities. The amendments to the ARC's governance and funding arrangements promote
the right to education as they improve and sustain the ability of the ARC to continue its
operations to support the university and research sector. It is vital that the governance of
the ARC, its assessment of research projects and its funding arrangements are secure for the
future to support the training and development of the research workforce, enabling
researchers to pursue new knowledge and ideas for the benefit of Australians.
Right to enjoy the benefits of scientific progress and its applications
The Bill engages the right to enjoy the benefits of scientific progress and its applications,
which is set out in Article 15(b) of the ICESCR.
The amendments promote this right by supporting successful research outcomes, driven
with the funding and support of the ARC. The amendments build on the foundation of the
ARC as the trusted agency for funding of ground-breaking research and technology
innovation for the betterment of society to provide economic, environmental and cultural
benefits for Australia.
Conclusion
The Bill is compatible with human rights because it supports the right to work, the right to
education and the right to enjoy the benefits of scientific progress and its applications.
Minister for Education, the Hon Jason Clare MP
8
AUSTRALIAN RESEARCH COUNCIL AMENDMENT (REVIEW RESPONSE) BILL 2023
NOTES ON CLAUSES
Clause 1: Short title
1. This is a formal provision specifying the short title of the Act, the Australian Research
Council Amendment (Review Response) Act 2023.
Clause 2: Commencement
2. The table in this clause sets out the commencement date for the whole of the
Australian Research Council Amendment (Review Response) Bill 2023 (the Bill), once
it becomes an Act, is 1 July 2024.
Clause 3: Schedules
3. This clause gives effect to the provisions in the Schedules to the Bill by providing that
any legislation that is specified in a Schedule to the Act is amended or repealed as
set out in the applicable items in the Schedule and that any other item in a Schedule
has effect according to its terms.
9
Schedule 1--Object of Act
Australian Research Council Act 2001
1. Schedule 1 to the Bill amends the object of the Australian Research Council Act 2001
(ARC Act) to clearly set out the role and mission of the Australian Research Council
(ARC), with a stronger focus on the ARC's impact and purpose in the facilitation of
research of national importance to Australia.
Item 1: Section 3
2. Item 1 repeals and replaces section 3 of the ARC Act, which sets out the object of the
Act. The new object of the Act is to establish a national body to:
• at paragraph (a), support Australian universities in conducting excellent research,
including collaborative research with local, national and international partners,
for Australia's economic, social, environmental and cultural benefit; and
• at paragraph (b), promote and conduct activities to shape and foster the
Australian research landscape and community including by supporting academic
career pathways, expanding Indigenous knowledge systems and evaluating the
excellence, impact and depth of Australian research; and
• at paragraph (c), support research integrity, promote ethical research and
facilitate access to research publications and research data; and
• at paragraph (d), uphold peer review as a core process to identify excellent
research; and
• at paragraph (e), administer funding of excellent pure basic research, strategic
basic research and applied research in all disciplines under the National
Competitive Grants Program, except experimental development; and
• at paragraph (f), administer funding for nationally significant research programs;
and
• at paragraph (g), provide expert advice on research to the Commonwealth
Government; and
• at paragraph (h), partner with other Commonwealth entities to deliver research
grants by those other entities.
3. The note under this section explains that the term 'research' (now defined in section
4 of the ARC Act) does not include medical research and that the National Health
10
and Medical Research Council Act 1992 (NHMRC Act) deals with funding for medical
research.
Item 2: Section 4
4. Section 4 of the ARC Act sets out the definitions in that Act.
5. Item 2 inserts a new definition of 'research' in section 4 of the ARC Act to explain that
research does not include medical research. It also includes a new definition of
'medical research' which has the same meaning as it has in the NHMRC Act.
11
Schedule 2--Australian Research Council Board and CEO
Australian Research Council Act 2001
1. Schedule 2 to the Bill amends the ARC Act to establish the Australian Research
Council Board (Board). Schedule 2 outlines the Board's functions, provisions relevant
to the appointment and termination of Board members, the terms and conditions of
their appointment and other governance procedures such as Board meetings. The
Board may also establish committees, including the College of Experts, to assist with
the carrying out of the Board's, and the Chief Executive Officer's (CEO), functions.
Item 1: Section 4
2. Item 1 inserts new definitions in section 4 of the ARC Act to reflect the establishment
of the Board. The new terms defined include Board, Board committee, Board
member, Chair, Commonwealth entity, and Deputy Chair.
Item 2: Section 4 (definition of designated committee)
3. Item 2 repeals and replaces the definition of designated committee to mean a
committee established under section 30 of the ARC Act.
Item 3: Section 4
4. Item 3 inserts a new definition of Indigenous person, which has the same meaning as
in the Indigenous Education (Targeted Assistance) Act 2000. That Act defines an
Indigenous person in section 4 as a member of the Aboriginal race of Australia, or a
descendant of the Indigenous inhabitants of the Torres Strait Islands.
5. Item 3 also inserts a new definition of paid work.
Item 4: Before paragraph 5(2)(a)
6. Item 4 inserts a new paragraph (aa) in subsection 5(2), which provides that the
Board is part of the ARC.
Item 5: Paragraph 5(3)(b)
7. Item 5 repeals and replaces paragraph 5(3)(b) of the ARC Act which provided that
the CEO is the accountable authority of the ARC. The new paragraph provides that
the members of the Board, as a group of persons, are the accountable authority of
12
the ARC. As the accountable authority under the Public Governance, Performance
and Accountability Act 2013, the Board members will have clear accountability and
responsibilities for overseeing the proper functioning of the ARC.
Item 6: Before subparagraph 5(3)(c)(i)
8. Item 6 inserts subparagraphs (ia) and (ib) to prescribe that the members of the
Board and the members of Board committees (established under new section 29)
are officials of the ARC for the purposes of the finance law (within the meaning of
the Public Governance, Performance and Accountability Act 2013).
Item 7: Subparagraph 5(3)(d)(i)
9. Item 7 omits the word "function" and substitutes the word "functions" so that the
purposes of the ARC include the functions of the ARC referred to in section 6.
Item 8: After subparagraph 5(3)(d)(i)
10. Item 8 inserts subparagraph (ia) to prescribe that the purposes of the ARC (for the
purposes of the finance law (within the meaning of the Public Governance,
Performance and Accountability Act 2013)) now include the functions of the Board
referred to in section 9.
Item 9: Section 6
11. Item 9 repeals and replaces section 6 to provide that the functions of the ARC (other
than the Board and the CEO) are to assist the Board in the performance of the
Board's functions and to assist the CEO in the performance of the CEO's functions.
Item 10: After Part 2
12. Item 10 inserts Part 3 into the ARC Act, which is a new part outlining the
establishment and operation of the Board.
Division 1 - Introduction
13. New section 7 provides the simplified outline of what Part 3 of the ARC Act is about.
It provides that the Board is established, and will consist of the Chair, Deputy Chair
and up to 5 other members, all appointed by the Minister. It also explains that Part 3
13
will deal with the terms and conditions of appointment for Board members,
meetings of the Board and Board committees.
14. New section 7 also explains that the Board's functions include determining priorities,
strategies and policies for the ARC. The purpose of establishing the Board is to
ensure the independence and integrity of the ARC and its decision-making processes.
It will provide reassurance that there is scrutiny of the ARC's decisions and
processes.
Division 2 - The Board
15. New section 8 provides that the Board is established by this section.
16. New subsection 9(1) outlines the functions of the Board, which are
• at paragraph (a), to determine priorities, strategies and policies for the ARC and
to advise the Minister of those priorities, strategies and policies;
• at paragraph (b), to assist the Minister in the performance of the Minister's
functions under the ARC Act;
• at paragraph (c), to provide advice to the Minister on research matters;
• at paragraph (d), any other functions that are specified in an instrument under
subsection 9(2); and
• at paragraph (e), any other functions conferred on the Board by the ARC Act.
17. New subsection 9(2) provides that the Minister may, by legislative instrument,
specify functions for the purposes of paragraph (1)(d). This means that an
instrument made by the Minister under this provision will be subject to
Parliamentary scrutiny as part of the normal disallowance processes specified in the
Legislation Act 2003.
18. The Board should perform its functions and exercise its powers in a way that ensures
the object of the ARC Act is achieved.
19. New subsection 9(3) provides that the Board has power to do all things necessary or
convenient to be done for, or in connection with, the performance of its functions.
20. New subsection 9(4) provides that the Board may engage consultants or contractors
to assist in the performance of the Board's functions.
21. New section 10 provides that the Minister may give directions to the Board. New
subsection 10(1) provides that the Minister may, by legislative instrument, give
directions to the Board about the performance of its functions or the exercise of its
14
powers. The note under subsection 10(1) explains that sections 42 (disallowance)
and Part 4 of Chapter 3 (sunsetting) of the Legislation Act 2003 do not apply to the
directions (see regulations made for the purposes of paragraphs 44(2)(b) and
54(2)(b) of the Act), meaning that the Minister's directions issued under section 10
are not disallowable and do not sunset.
22. New subsection 10(2) provides that the Minister must not give a direction in relation
to the making of a decision by the Board about whether or not to give a particular
funding approval. This is to ensure that the Board maintains independence for the
making of grant decisions. New subsection 10(3) requires the Board to comply with a
direction under subsection 10(1).
23. New section 11 outlines the membership of the Board, to consist of a Chair, a Deputy
Chair and between 3 to 5 other members.
Division 3 - Board members
24. Division 3 sets out requirements relating to Board members.
25. New section 12 explains how Board members will be appointed. New subsection
12(1) provides that Board members are to be appointed by the Minister by written
instrument. The note under subsection 12(1) explains that Board members may be
reappointed as per section 33AA of the Acts Interpretation Act 1901. New subsection
12(2) provides that a Board member holds office on a part-time basis.
26. New subsection 12(3) provides that a person is not eligible for appointment as the
Chair unless the Minister is satisfied that the person has substantial experience or
expertise, and professional credibility and significant standing, in one or more fields
of research or in the management of research. New subsection 12(4) provides that,
in appointing Board members, the Minister must:
• at paragraph (a), ensure that a majority of the Board members are persons
whom the Minister is satisfied have substantial experience or expertise in one or
more fields of research or in the management of research; and
• at paragraph (b), ensure that one of the Board members is an Indigenous person;
and
• at paragraph (c), ensure that one of the Board members is a person whom the
Minister is satisfied will represent regional, rural and remote Australia; and
• at paragraph (d), have regard to the desirability of the membership of the Board
reflecting the diversity of the general community.
15
27. New section 13 provides that a Board member holds office for the period specified in
the instrument of appointment and the period must not exceed 5 years. The note
under this section explains that Board members may be reappointed as per section
33AA of the Acts Interpretation Act 1901.
28. New section 14 sets out provisions relating to acting appointments. Subsection 14(1)
permits the Deputy Chair to act as the Chair during the circumstances prescribed in
either paragraph (a) when there is a vacancy in the office of Chair, or paragraph (b)
for any or all periods when the Chair is absent from duty or is, for any reason, unable
to perform the duties of the office.
29. New subsection 14(2) provides that the Minister may, by written instrument,
appoint a Board member to act as the Deputy Chair during the circumstances
prescribed in either paragraph (a) when there is a vacancy in the office of Deputy
Chair (whether or not an appointment has previously been made to the office), or
paragraph (b) for any or all periods when the Deputy Chair is acting as the Chair, or is
absent from duty or is, for any reason, unable to perform the duties of the office.
30. New subsection 14(3) provides that the Minister may, by written instrument,
appoint a person to act as a Board member (other than the Chair or the Deputy
Chair) during the circumstances prescribed in either paragraph (a) when there is a
vacancy in the office of a Board member (whether or not an appointment has
previously been made to the office), or paragraph (b) for any or all periods when a
Board member is acting as the Deputy Chair, or is absent from duty or is, for any
reason, unable to perform the duties of the office.
31. New subsection 14(4) provides that a person must not be appointed under
subsection (2) or (3) to act as the Deputy Chair, or as another Board member, unless
the Minister is satisfied that the person has appropriate qualifications, knowledge,
skills or experience. The note under subsection 14(4) explains that sections 33AB and
33A of the Acts Interpretation Act 1901 contain rules that apply to acting
appointments. This aligns with the expectation that members of the Board will have
a combination of skills, experience, and perspectives relevant to the functions of the
ARC across the spectrum of ARC disciplines.
32. New section 15 sets out the renumeration of Board members. New subsection 15(1)
provides that a Board member is to be paid the remuneration that is determined by
the Remuneration Tribunal. This subsection further states that if no determination of
that remuneration by the Tribunal is in operation, then the member is to be paid the
remuneration that is prescribed by the regulations. New subsection 15(2) provides
that a Board member is to be paid the allowances that are prescribed by the
16
regulations. New subsection 15(3) provides that section 15 has effect subject to the
Remuneration Tribunal Act 1973.
33. New section 16 sets out the leave provisions for Board members. New subsection
16(1) provides that the Minister may grant the Chair leave of absence on the terms
and conditions that the Minister determines. New subsection 16(2) provides that the
Chair may grant leave of absence to any other Board member on the terms and
conditions that the Chair determines. New subsection 16(3) provides that the Chair
must notify the Minister if the Chair grants a Board member leave of absence for a
period that exceeds 6 months.
34. New section 17 provides that a Board member must not engage in any paid work
that, in the Minister's opinion, conflicts or could conflict with the proper
performance of the member's duties. For example, this may include a Board
member being employed by or receiving payment from an organisation for working
on a research project at the organisation that is applying for, or is receiving, a grant
of financial assistance under the ARC Act.
35. New section 18 sets out requirements on Board members to disclose interests. New
subsection 18(1) provides that a disclosure by a Board member under section 29 of
the Public Governance, Performance and Accountability Act 2013 (which deals with
the duty to disclose interests) must be made to the Minister. New subsection 18(2)
explains that subsection 18(1) applies in addition to any rules made for the purposes
of section 29 of the Public Governance, Performance and Accountability Act 2013.
New subsection 18(3) provides that a Board member is taken not to have complied
with section 29 of the Public Governance, Performance and Accountability Act 2013 if
the Board member does not comply with subsection 18(1).
36. New section 19 sets out provisions relating to a Board member's resignation of
appointment. New subsection 19(1) provides that a Board member may resign the
member's appointment by giving the Minister a written resignation. New subsection
19(2) provides that the resignation takes effect on the day it is received by the
Minister or, if a later day is specified in the resignation, on that later day.
37. New section 20 sets out provisions relating to a Board member's termination of
appointment by the Minister. New subsection 20(1) provides that the Minister may
terminate the appointment of a Board member for the reasons prescribed in either
paragraph (a) for misbehaviour or in paragraph (b) if the member is unable to
perform the duties of the member's office because of physical or mental incapacity.
New subsection 20(2) provides further circumstances in which the Minister may
terminate the appointment of a Board member if:
17
• in paragraph (a) the member becomes bankrupt, or applies to take the benefit of
any law for the relief of bankrupt or insolvent debtors, or compounds with the
member's creditors, or makes an assignment of the member's remuneration for
the benefit of the member's creditors; or
• in paragraph (b) the member is absent, except on leave of absence, from 3
consecutive meetings of the Board; or
• in paragraph (c) the member engages in paid work that, in the Minister's opinion,
conflicts or could conflict with the proper performance of the member's duties
(see section 17); or
• in paragraph (d) the member fails, without reasonable excuse, to comply with
section 29 of the Public Governance, Performance and Accountability Act 2013
(which deals with the duty to disclose interests) or rules made for the purposes
of that section.
38. New section 21 provides that a Board member holds office on the terms and
conditions determined by the Minister in relation to matters not covered by the ARC
Act (if any).
Division 4--Procedures of the Board
39. Division 4 sets out various procedures of the Board and requirements for meetings.
40. New section 22 sets out provisions for convening meetings. New subsection 22(1)
provides that the Board must hold such meetings as are necessary for the efficient
performance of its functions. New subsection 22(2) provides that the Chair:
• at paragraph (a) may convene a Board meeting at any time; and
• at paragraph (b) must convene a Board meeting within 30 days after receiving a
written request to do so from either a majority of Board members or the
Minister.
41. New subsection 23(1) provides that at a meeting of the Board, a quorum is
constituted by a majority of Board members. New subsection 23(2) provides that, if:
• at paragraph (a) a Board member is required by rules made for the purposes of
section 29 of the Public Governance, Performance and Accountability Act 2013
not to be present during the deliberations, or to take part in any decision, of the
Board with respect to a particular matter; and
• at paragraph (b) when the Board member leaves the meeting concerned there is
no longer a quorum present;
the remaining Board members constitute a quorum for the purposes of any
deliberation or decision at that meeting with respect to that matter.
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42. New section 24 sets out who presides at Board meetings. New subsection 24(1)
provides that the Chair must preside at all meetings of the Board at which the Chair
is present. New subsection 24(2) provides that, if the Chair is not present at a
meeting of the Board, the Deputy Chair, if present, must preside at the meeting.
New subsection 24(3) provides that if neither the Chair nor the Deputy Chair is
present at a meeting of the Board, the other Board members present must appoint
one of themselves to preside.
43. New section 25 outlines provisions relating to voting at Board meetings. New
subsection 25(1) provides that a question arising at a meeting of the Board is to be
determined by a majority of the votes of the Board members present and voting.
New subsection 25(2) provides that the person presiding at the meeting of the Board
has a deliberative vote (i.e. a vote that contributes to the final decision) and, if the
votes are equal, a casting vote (i.e. the deciding vote).
44. New section 26 provides that the Board must keep minutes of its meetings.
45. New section 27 provides that the Board may, subject to new Division 4 of Part 3 of
the ARC Act, regulate proceedings at its meetings as it considers appropriate. The
note under this section explains that section 33B of the Acts Interpretation Act 1901
contains further information about the ways in which Board members may
participate in meetings.
46. New section 28 prescribes the circumstances when the Board is taken to have made
a decision without a Board meeting. New subsection 28(1) provides that this occurs
when:
• in paragraph (a), a majority of the Board members entitled to vote on the
proposed decision indicate agreement with the decision; and
• in paragraph (b), that agreement is indicated in accordance with the method
determined by the Board under subsection 28(2); and
• in paragraph (c), all Board members were informed of the proposed decision, or
reasonable efforts were made to inform all Board members of the proposed
decision.
47. New subsection 28(2) provides that subsection 28(1) applies only if the Board has in
paragraph (a) determined that the Board may make decisions of that kind without
meeting, and in paragraph (b) determined the method by which Board members are
to indicate agreement with proposed decisions.
48. New subsection 28(3) provides that for the purposes of paragraph 28(1)(a), a Board
member is not entitled to vote on a proposed decision if the Board member would
19
not have been entitled to vote on that proposal if the matter had been considered at
a meeting of the Board.
49. New subsection 28(4) provides that the Board must keep a record of decisions made
in accordance with section 28.
Division 5--Board committees
50. Division 5 sets out provisions relating to Board committees. Division 5 allows the
Board to establish and appoint members to such committees as it deems beneficial
for the effective functioning of the ARC. This includes establishing and appointing
members to the College of Experts. It is expected that, amongst other things, Board
committees will provide recommendations to the Board about approvals of grants
for financial assistance to organisations following appropriate expert and peer
review processes.
51. New section 29 sets out the provisions relating to Board committees. New
subsection 29(1) provides that the Board must establish a committee to be known as
the College of Experts to assist the Board in the performance of its functions or the
exercise of its powers.
52. New subsection 29(2) provides that the Board may establish other committees to
assist the Board, and the CEO, in the performance of the Board's, or the CEO's,
functions or the exercise of the Board's, or the CEO's, powers.
53. New subsection 29(3) provides that a committee is to consist of such persons
(whether Board members or not) as the Board determines.
54. New subsection 29(4) allows the Board to determine a committee's terms of
reference, the terms and conditions of appointment of the members of a committee
and the procedures to be followed by a committee.
55. New subsection 29(5) provides that the Board may abolish a committee established
under subsection 29(2) at any time. This means that the Board cannot abolish the
College of Experts.
Item 11: Section 30 (heading)
56. Item 11 repeals and replaces the heading with "30 Designated committees".
Item 12: Subsection 30(1)
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57. Item 12 repeals subsection 30(1) of the ARC Act and replaces it with new subsections
30(1) and (1A). New subsection 30(1) provides that the Minister must establish a
committee to be known as the ARC Advisory Committee to assist the Board to
determine priorities, strategies and policies for the ARC. The ARC Advisory
Committee will be made up of eminent sectoral representatives, to support the ARC
Board by providing advice on sector priorities, opportunities, challenges, and risks.
58. New subsection 30(1A) provides that the Minister may establish other committees
to assist the Board to determine priorities, strategies and policies for the ARC.
Items 13 and 14: Section 33B (heading) and Section 33B
59. Items 13 and 14 make minor technical amendments to the heading in section 33B
and section 33B to clarify the purpose of that section and to reflect the amended
structure of that section.
Item 15: Paragraph 33B(a)
60. Item 15 repeals paragraph (a) in section 33B. This paragraph provided that a function
of the CEO is to make recommendations to the Minister under section 52 in relation
to which proposals should be approved as deserving financial assistance under
Division 1 of Part 7. This paragraph is no longer necessary as the Board or the
Minister will approve grants of financial assistance following peer review processes
(which includes drawing on the expertise and recommendations of the College of
Experts).
Item 16: Paragraph 33B(c)
61. Item 16 omits the word "Minister" and substitutes the word "Board" in paragraph
33B(c) so that a function of the CEO is to provide advice to the Board on research
matters, rather than the Minister (noting the Board now provides advice to the
Minister on research matters).
Item 17: After paragraph 33B(c)
62. Item 17 adds new functions for the CEO in section 33B:
• new paragraph (ca), to assist the Board in the performance of its functions and to
provide advice to the Board on the priorities, strategies and policies for the ARC;
• new paragraph (cb), to evaluate the excellence, quality and impact of research in
Australian universities;
21
• new paragraph (cc), to provide administration services to other Commonwealth
entities in relation to research grants by those other entities; and
• new paragraph (cd), any other functions that are specified in an instrument
made by the Minister under subsection 17(2).
63. The new functions of the CEO at paragraphs 33B(cb) and (cc) reflect
recommendation 2 of the Review by ensuring that the ARC can continue to meet
community expectations on research funded by the Commonwealth and that the
ARC can harness its capabilities to support other Commonwealth agencies in relation
to their research grants. The CEO should perform their functions and exercise their
powers in a way that ensures the object of the ARC Act is achieved.
Item 18: At the end of section 33B
64. Item 18 adds new subsection 33B(2) which provides that the Minister may, by
legislative instrument, specify functions for the purposes of paragraph 33B(1)(cd).
This means that an instrument made by the Minister under this provision will be
subject to Parliamentary scrutiny as part of the normal disallowance processes
specified in the Legislation Act 2003.
65. Item 18 also adds new subsection 33B(3) which provides that the CEO has power to
do all things necessary or convenient to be done for, or in connection with, the
performance of the CEO's functions.
66. Item 18 also adds new subsection 33B(4) which provides that the CEO may, on
behalf of the Commonwealth, engage consultants or contractors to assist in the
performance of the CEO's functions.
Item 19: Section 33C
67. Item 19 repeals this section as the Minister no longer directs the CEO about the
performance of the CEO's functions. Under new section 10, the Minister may give
directions to the Board about the performance of its functions or the exercise of its
powers and under new section 40B, the Board may give directions to the CEO about
the performance of the CEO's functions. These changes reflect the amendments to
the governance structure of the ARC.
Item 20: Subsection 34(1)
68. Item 20 omits the word "Minister" and substitutes the word "Board" in subsection
34(1) so that the CEO is to be appointed by the Board by written instrument for the
22
period specified in the instrument, which must not exceed 5 years. This reflects the
amendments to the governance structure of the ARC made throughout the Bill. The
CEO may be reappointed as per section 33AA of the Acts Interpretation Act 1901.
Item 21: Subsection 34(2)
69. Item 21 repeals subsection 34(2) and replaces it with a new subsection which
provides that a person is not eligible to be appointed as CEO unless the Board is
satisfied that the person has substantial experience or expertise, and professional
credibility and significant standing, in one or more fields of research or in the
management of research.
70. Item 21 also adds new subsections 34(3) and (4) specifying additional requirements
for the Board to take into account when appointing the CEO.
71. New subsection 34(3) provides that the Board must give the Minister details of at
least 2 possible candidates for appointment as CEO and give the Minister a
reasonable opportunity to make representations to the Board about those
candidates.
72. New subsection 34(4) provides that a person must not be appointed as the CEO
unless the Board is satisfied that the selection of the person for the appointment is
the result of a process that was merit-based and included public advertising of the
position.
Item 22: Section 35
73. Item 22 omits the word "Minister" and substitutes the word "Board" in section 35 so
that the Board may appoint a person to act as the CEO during the prescribed
circumstances in either paragraph (a) where there is a vacancy in the office of CEO,
or paragraph (b) during any or all periods when the CEO is absent from duty, or
absent from Australia, or is, for any reason, unable to perform the duties of the
office.
Item 23: Subsection 38(1)
74. Item 23 repeals subsection 38(1) and substitutes a new subsection with a
requirement that the CEO must not engage in paid work outside the duties of the
CEO's office without the Board's approval.
Item 24: Subsection 38(2)
23
75. Item 24 omits the word "Minister" and substitutes the word "Board" in subsection
38(2) so that the Board can determine, in writing, the terms and conditions on which
the CEO holds office.
Item 25: Subsection 38(3)
76. Item 25 repeals the subsection because it will now be the Board, not the Minister,
who may terminate the CEO's appointment. The circumstances in which the Board
may terminate the appointment of the CEO are now under new section 40A.
Item 26: Section 39
77. Item 26 omits the word "Minister" and substitutes the word "Board" in section 39 so
that, before starting to hold office, the CEO must give to the Board a written
statement of any interest the CEO has that may relate to the functions of the CEO.
The note under this section provides that the CEO must also disclose interests under
section 29 of the Public Governance, Performance and Accountability Act 2013.
Item 27: Section 40
78. Item 27 omits the word "Minister" and substitutes the word "Board" as the CEO's
resignation is now to be given to the Board.
Item 28: At the end of Subdivision B of Division 1 of Part 5
79. Item 28 adds new sections 40A and 40B to the end of Subdivision B of Division 1 of
Part 5.
80. New section 40A sets out provisions relevant to the termination of the CEO's
appointment by the Board. New subsection 40A(1) provides that the Board may
terminate the CEO's appointment for either at paragraph (a) misbehaviour or at
paragraph (b) if the CEO is unable to perform the duties of the CEO's office because
of physical or mental incapacity.
81. New subsection 40A(2) provides other prescribed circumstances in which the Board
may terminate the CEO's appointment if:
• in paragraph (a) the CEO becomes bankrupt, or applies to take the benefit of any
law for the relief of bankrupt or insolvent debtors, or compounds with the CEO's
creditors, or makes an assignment of the CEO's remuneration for the benefit of
the CEO's creditors; or
24
• in paragraph (b) the CEO is absent, except on leave of absence, for 14
consecutive days or for 28 days in any 12 months; or
• in paragraph (c) the CEO engages, except with the Board's approval, in paid work
outside the duties of the CEO's office (see section 38); or
• in paragraph (d) the CEO fails, without reasonable excuse, to comply with section
39 (which deals with the duty to disclose interests); or
• in paragraph (e) the CEO fails, without reasonable excuse, to comply with section
29 of the Public Governance, Performance and Accountability Act 2013 (which
deals with the duty to disclose interests) or rules made for the purposes of that
section.
82. New subsection 40A(3) provides that the Board may terminate the appointment of
the CEO if the Board is satisfied that the performance of the CEO has been
unsatisfactory for a significant period of time.
83. New subsection 40A(4) requires the Board to consult the Minister before
terminating the CEO's appointment.
84. New section 40B provides that the Board may give directions to the CEO about the
performance of their functions, with which the CEO must comply.
85. New subsection 40B(1) provides that the Board may give written directions to the
CEO about the performance of the CEO's functions, which may include a direction to
provide advice to the Minister on the priorities, strategies and policies for the ARC.
86. New subsection 40B(2) requires that the CEO must comply with a direction under
subsection 40B(1).
87. New subsection 40B(3) provides that subsection 40B(1) does not apply to the extent
that the direction relates to the CEO's performance of functions or exercise of
powers under the Public Service Act 1999 in relation to the ARC.
88. New subsection 40B(4) clarifies that a direction under subsection (1) is not a
legislative instrument. This provision is included to assist readers, as such a notice is
not a legislative instrument within the meaning of subsection 8(1) of the Legislation
Act 2003. Rather, a direction is declaratory of the law, that is, a method by which the
Board can inform the CEO of its direction, and is not intended to prescribe a
substantive exemption from the requirements of the Legislation Act 2003.
Item 29: Application provisions - CEO
25
89. Item 29 sets out the application provisions for the amendments made by Schedule 2
in relation to the CEO:
• Subitem 60(1) provides that the amendments of sections 34 and 39 of the ARC
Act made by Schedule 2 apply in relation to the appointment of a person as CEO
on or after the commencement of item 29 (being 1 July 2024).
• Subitem 60(2) provides that the amendments of sections 33B, 35, 38 and 40 of
the ARC Act made by Schedule 2, and sections 40A and 40B of the ARC Act as
added by Schedule 2, apply in relation to the appointment of a person as CEO
before, on or after the commencement of item 29 (being 1 July 2024).
90. These application provisions ensure that the appointment of the current CEO
continues under existing arrangements. However, the CEO will be subject to the new
requirements for the CEO, as set out in the Bill, from 1 July 2024.
Item 30: Saving provision - directions
91. Item 30 provides that paragraph 33C(3)(a) of the ARC Act, as in force immediately
before commencement of item 30 (being 1 July 2024), continues to apply on and
after the commencement of item 30 in relation to a direction given before that
commencement.
92. This is a saving provision which ensures that any directions given by the Minister to
the CEO must be tabled in each House of Parliament within 15 sitting days of that
House after the direction is given.
26
Schedule 3--Funding of research
Australian Research Council Act 2001
1. Schedule 3 to the Bill amends the ARC Act to enable the Board to approve grants of
financial assistance to organisations (except for designated research programs) in
line with the funding rules made by the Minister. It is expected that before the Board
approves a grant, the Board will take into account advice following expert and peer
review processes. The Minister will approve grants of financial assistance for
designated research programs to recognise the role of such programs in creating
research capability rather than programs that award individual research grants.
2. Organisations will be required to enter into funding agreements with the CEO to
receive grants and the CEO is able to terminate an agreement if a term or condition
is breached. The Board and the Minister may also terminate a funding approval for
breach of an agreement. If an organisation's agreement or approval is terminated,
the CEO, the Board or the Minister may recover any amounts paid, and the CEO is
also able to set-off a debt to the Commonwealth against payments for future grants
under the ARC Act. The Minister is empowered to consider reasons relevant to the
security, defence or international relations of Australia that a grant of financial
assistance to an organisation should not be approved or should be terminated. If this
happens, the Minister may recover the amount of the grant that was paid to the
organisation, or a portion of that grant amount.
3. This Schedule also amends the ARC's current administered funding for grants from
special appropriation to annual appropriation. As a result, this removes
requirements to specify annual funding caps relating to specific funding years and to
split funding between categories of research programs. Indexation based on the
Consumer Price Index (CPI) will be applied as part of the annual appropriation on 1
July each financial year. The Minister for Finance has agreed to an indexation floor to
protect against CPI fluctuations below zero per cent that is consistent with the
arrangements in sections 198-10(1) and (2) of the Higher Education Support Act
2003.
4. This Schedule also makes changes to the ARC Research Endowment Account to enable
the special account to be utilised to administer funding for the purposes of the ARC
Act.
27
Item 1: Section 4
5. Item 1 inserts "(1)" before the word "In" in section 4 which is a minor technical
amendment that reflects the updated structure of this section.
Item 2: Section 4
6. Item 2 inserts new definitions that are relevant to the funding of research. The terms
defined include approved funding rules, designated research program, foreign
government body, foreign intelligence agency, foreign law enforcement agency,
foreign military body, funding agreement, and funding approval.
Item 3: At the end of section 4
7. Item 3 adds a new subsection 4(2) to provide that the Minister may, by legislative
instrument, specify a research program for the purposes of paragraph 4(1)(d) of the
definition of designated research program in subsection 4(1). This allows the
Minister to specify any additional designated research programs for which the
Minister is responsible for approving grants of financial assistance under new section
48. An instrument made by the Minister under this provision will be subject to
Parliamentary scrutiny as part of the normal disallowance processes specified in the
Legislation Act 2003.
Items 4 and 5: Paragraph 33B(b)
8. Items 4 and 5 make minor technical amendments to paragraph 33B(b) to reflect the
changes being made to the structure of Part 7 of the ARC Act.
Item 6: Division 1 of Part 7
9. Item 6 repeals Division 1 and substitutes a new Division. New Division 1 is titled
"Grants of financial assistance for research programs". The new provisions specifying
that the Board will have responsibility for approving grants for research programs
will strengthen the overall integrity of the ARC funding system as the Board is
expected to be best placed to draw on the unique expertise within the College of
Experts, and other Board committees, to guide discreet strategic funding for
programs. The Minister will approve grants for key national programs (known as
designated research programs) in recognition of the role of those programs in
creating research capability. The funding arrangements have also been simplified, by
repealing requirements for the Minister to determine funding caps for funding years
28
and to divide the funding caps.
10. New section 47 provides that the Board may approve grants of financial assistance
for research programs.
11. New subsection 47(1) provides that the Board may, in writing, approve the making
of a grant of financial assistance to an organisation for a research project in relation
to a research program. "Research program" continues to be defined in section 4 of
the ARC Act to mean a program of research or a program that supports the conduct
of a program of research. The Board will be responsible for deciding whether an
application for a research project, made in relation to a research program, should be
approved for a grant of financial assistance.
12. New subsection 47(2) provides that, if the Board approves a grant, the Board must
specify in the approval the total amount of financial assistance to be paid to the
organisation in relation to the approval. The note under this subsection explains that
the terms and conditions on which a grant of financial assistance is to be made to an
organisation are to be set out in a funding agreement (see section 49).
13. New subsection 47(3) provides that subsection 47(1) does not apply in relation to a
research program that is a designated research program. The Board cannot approve
a grant of financial assistance in relation to a designated research program. The note
under this subsection provides that section 48 (Ministerial approval of grants of
financial assistance for designated research programs) deals with designated
research programs.
14. New subsection 47(4) provides that the Board must not give an approval under
subsection 47(1) unless:
• at paragraph (a), approved funding rules, to which the application for the
approval relates, are in force; and
• at paragraph (b), the eligibility criteria set out in those rules are satisfied in
relation to the application; and
• at paragraph (c), the application satisfies the requirements set out in those rules;
and
• at paragraph (d), the assessment process set out in those rules has been
complied with in relation to the application.
15. New subsection 47(5) provides that the Board may, in writing, vary an approval
under subsection 47(1).
29
16. New subsection 47(6) provides that, if the Board gives an approval or varies an
approval, the Board must give the Minister:
• for an approval - the name of the organisation that is the subject of the
approval; a description of the research program the subject of the approval; and
the total amount of financial assistance to be paid to the organisation in relation
to the approval; or
• for a variation - details of the variation.
17. This information must be given to the Minister, to ensure that the Minister can
comply with the tabling requirements in subsection 47(11) and so that the Minister
can consider whether there are reasons relevant to the security, defence or
international relations of Australia, such that the approval should be terminated.
18. New subsection 47(7) provides that, if the Board gives or varies an approval, the
Board must give the CEO a copy of the approval or variation. A copy of the approval
or variation must be given to the CEO so that the CEO can enter into, or vary, a
funding agreement with the relevant organisation.
19. New subsection 47(8) provides that, if the Minister considers that, for reasons
relevant to the security, defence or international relations of Australia, the Board
should not give an approval under subsection (1), the Minister must, by notice in
writing given to the Board, inform the Board to this effect.
20. New subsection 47(9) requires that the Board must comply with the notice.
21. New subsection 47(10) provides that a notice given under subsection 47(8) is not a
legislative instrument. This provision is included to assist readers, as such a notice is
not a legislative instrument within the meaning of subsection 8(1) of the Legislation
Act 2003. Rather, a notice is declaratory of the law, that is, a method by which the
Minister can inform the Board of the Minister's decision, and is not intended to
prescribe a substantive exemption from the requirements of the Legislation Act
2003.
22. As recommended by the Review, the Minister is empowered by new subsections
47(8) and (9) to step in if there are reasons relevant to the security, defence or
international relations of Australia that a grant to an organisation should not be
approved. This power is being included in the ARC Act to ensure that Australia's
research sector is protected against any threats from foreign actors. The exercise of
this power will have significant consequences for an organisation. As such, it is
appropriate for the Minister, as the relevant representative of the Commonwealth,
to be empowered to make these decisions, taking advice from relevant
30
Commonwealth entities. It is expected that this power will only be exercised in
relation to those organisations or research projects that have ongoing national
security concerns or those specifically identified by Commonwealth entities as of
concern.
23. New subsection 47(11) provides that the Minister must cause a statement setting
out the details of a Board funding approval (including the total amount of funding
approved, the name of the organisation and the research program to which the
funding relates) to be tabled in each House of the Parliament within 15 sitting days
of that House after the day on which the Board gives the Minister details of an
approval under section 47.
24. New section 48 sets out the arrangements for Ministerial approval of grants of
financial assistance for designated research programs.
25. New subsection 48(1) provides that the Minister may, in writing, approve the making
of a grant of financial assistance to an organisation for a research project in relation
to a designated research program. "Research program" continues to be defined in
section 4 of the ARC Act to mean a program of research or a program that supports
the conduct of a program of research. The Minister will be responsible for deciding
whether an application for a research project, made in relation to a designated
research program, should be approved for a grant of financial assistance.
26. New subsection 48(2) provides that, if the Minister approves a grant, the Minister
must specify in the approval the total amount of financial assistance to be paid to
the organisation in relation to the approval. The note under this subsection explains
that the terms and conditions on which a grant of financial assistance is to be made
to an organisation are to be set out in a funding agreement (see section 49).
27. New subsection 48(3) provides that the Minister must not give an approval under
subsection 48(1) unless:
• at paragraph (a), approved funding rules, to which the application for the
approval relates, are in force; and
• at paragraph (b), the eligibility criteria set out in those rules are satisfied in
relation to the application; and
• at paragraph (c), the application satisfies the requirements set out in those rules;
and
• at paragraph (d), the assessment process set out in those rules has been
complied with in relation to the application.
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28. New subsection 48(4) provides that the Minister may, in writing, vary an approval
under subsection 48(1).
29. New subsection 48(5) provides that, if the Minister gives an approval or varies an
approval, the Minister must give the CEO a copy of the approval or variation. A copy
of the approval or variation must be given to the CEO so that the CEO can enter into,
or vary, a funding agreement with the relevant organisation.
30. New subsection 48(6) provides that the Minister must refuse to give an approval
under subsection 48(1) if the Minister considers that, for reasons relevant to the
security, defence or international relations of Australia, the approval should be
refused.
31. New subsection 48(7) provides that the Minister must give the Board written notice
of a decision under subsection 48(6). As recommended by the Review, the Minister
must not approve a grant if there are reasons relevant to the security, defence or
international relations of Australia that a grant should not be approved. This power
is being included in the ARC Act to ensure that Australia's research sector is
protected against any threats from foreign actors. The exercise of this power will
have significant consequences for an organisation. As such, it is appropriate for the
Minister, as the relevant representative of the Commonwealth, to be empowered to
make these decisions, taking advice from relevant Commonwealth entities. It is
expected that this power will only be exercised in relation to those organisations or
research projects that have ongoing national security concerns or those specifically
identified by Commonwealth entities as of concern. The Minister must give notice of
such decisions to the Board so that the Board can report the number of decisions
made by the Minister under this provision in the ARC's annual report (as required by
section 65A).
32. New subsection 48(8) provides that the Minister must cause a statement setting out
the details of a funding approval given by the Minister (including the total amount of
funding approved, the name of the organisation and a description of the designated
research program to which the funding relates) to be tabled in each House of the
Parliament within 15 sitting days of that House after the day on which the Minister
gives an approval under section 48.
33. New section 49 sets out requirements relating to funding agreements between an
organisation approved for a grant of financial assistance and the CEO. This section is
included to ensure that there is clarity of the ARC's research integrity functions by
strengthening the status of funding agreements. This is achieved by holding
organisations accountable to the terms and conditions set out in their funding
32
agreements.
34. New subsection 49(1) provides that the terms and conditions on which a grant of
financial assistance is to be made to an organisation under Division 1 of Part 7 of the
ARC Act are to be set out in a written agreement (known as the funding agreement)
between the organisation and the CEO.
35. New subsection 49(2) sets out matters that the agreement must contain, but does
not limit the terms and conditions that can be included. The matters in subsection
49(2) are:
• at paragraph (a), specify the one or more periods to which the grant relates; and
• at paragraph (b), specify the amount of financial assistance to be paid in each of
those periods; and
• at paragraph (c), specify the times at which each amount of financial assistance is
to be paid; and
• at paragraph (d), include a description of the research project concerned; and
• at paragraph (e), include the name and title of the person leading the research
project concerned; and
• at paragraph (f), include terms or conditions relating to the organisation giving
the CEO regular independent auditor statements relating to the organisation's
compliance with some or all of the terms and conditions set out in the
agreement.
36. New subsection 49(3) provides that the CEO may, on behalf of the Commonwealth,
enter into a funding agreement.
37. New subsection 49(4) provides that, if the CEO is satisfied that the organisation that
is a party to a funding agreement has breached a term or condition of the
agreement, the CEO must notify the Board or the Minister of the breach (depending
on who gave the approval) and give the Board or the Minister a copy of the relevant
funding agreement.
38. New subsection 49(5) provides that subsection 49(4) does not apply if the breach is
of a minor nature. Breaches that are not of a minor nature would include:
• where the organisation's involvement with the research project concerned ends
contrary to the requirements in the relevant funding agreement;
• where the research project concerned changes so that it is no longer consistent
with the description in the agreement;
• where the person named in the agreement as the person leading the research
project ceases to lead the program contrary to the requirements in the relevant
agreement; or
33
• any other breach that would have a substantial effect on the performance or
completion of the research project.
39. New subsections 49(4) and (5) ensure that the Minister and the Board are made
aware of any serious breaches of the terms and conditions specified in an
organisation's funding agreement, and, if there is a breach of those terms and
conditions, the Minister and the Board can then consider whether it is appropriate to
terminate or vary the relevant funding approval (see section 50).
40. New section 50 provides powers for the CEO to terminate or vary a funding
agreement, and for the Board and Minister to terminate or vary a funding approval.
Providing clear powers in the ARC Act to terminate or vary funding agreements or
funding approvals is fundamental to the ARC's research integrity functions.
41. New subsection 50(1) provides that, if the CEO is satisfied that the organisation that
is a party to a funding agreement has breached a term or condition of the funding
agreement, the CEO may, on behalf of the Commonwealth:
• at paragraph (a), terminate the funding agreement; or
• at paragraph (b), vary the funding agreement. For example, the CEO may vary
the terms and conditions relating to the periods in which payments of financial
assistance are made to an organisation.
42. New subsection 50(2) provides that the CEO may vary the funding agreement in any
other circumstances. For example, if the organisation requests the CEO to vary
details in the funding agreement prior to a breach occurring and the CEO agrees to
varying the agreement so that a breach does not occur.
43. New subsection 50(3) provides that the terms and conditions that may be set out in
a funding agreement are not limited by subsections 50(1) and (2).
44. New subsection 50(4) provides that, the Board may terminate or vary a funding
approval given under subsection 47(1) in relation to an organisation if:
• at paragraph (a), the CEO gives the Board a notice under subsection 49(4) about
a term or condition of the funding agreement that relates to the funding
approval; and
• at paragraph (b), the Board is satisfied that the organisation has breached the
term or condition.
The note under this subsection provides that Board also has a general power to vary
a funding approval under subsection 47(5).
34
45. New subsection 50(5) provides that the Minister may terminate or vary a funding
approval given under subsection 48(1) in relation to an organisation if:
• at paragraph (a), the CEO gives the Minister a notice under subsection 49(4)
about a term or condition of the funding agreement that relates to the funding
approval; and
• at paragraph (b), the Minister is satisfied that the organisation has breached the
term or condition.
The note under this subsection provides that the Minister also has a general power
to vary a funding approval under subsection 48(4).
46. New subsection 50(6) sets out the procedural fairness requirements for the CEO,
Board or Minister when making decisions to terminate a funding agreement or
terminate or vary a funding approval. The termination powers will not be exercised
lightly and only after the organisation has had a reasonable opportunity to respond
by providing information in relation to the breach of a term or condition and reasons
why a funding agreement or approval should not be terminated. This new subsection
provides that, before making a decision under paragraph 50(1)(a), subsection 50(4)
or subsection 50(5), the CEO, Board or Minister (as the case requires) must give the
organisation notice in writing:
• at paragraph (a), stating the decision the CEO, Board or Minister is considering
making; and
• at paragraph (b), stating the reasons why the CEO, Board or Minister is
considering making the decision; and
• at paragraph (c), inviting the organisation to make written submissions to the
CEO, Board or Minister within 28 days concerning why the decision should not be
made.
47. Despite subsection 50(6) not applying to variations of funding agreements made by
the CEO, in some circumstances where the CEO varies a funding agreement, the CEO
may need to give the organisation procedural fairness under the common law.
48. New subsection 50(7) provides that in deciding whether to make a decision under
paragraph 50(1)(a), subsection 50(4) or subsection 50(5), the CEO, Board or Minister
(as the case requires) must consider any submissions received from the organisation
within the 28 day period.
49. New subsection 50(8) requires the CEO, Board or Minister (as the case requires) to
give the organisation notice in writing of a decision under subsections (1), (2), (4) or
(5) and of the reasons for the decision.
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50. New subsection 50(9) provides that the CEO must give the Board notice in writing of
the CEO's termination of a funding agreement that relates to a funding approval
given by the Board under subsection 47(1).
51. New subsection 50(10) provides that the CEO must give the Minister notice in
writing of the CEO's termination of a funding agreement that relates to a funding
approval given by the Minister under subsection 48(1).
52. New section 51 sets out the effect on the payment of financial assistance once the
CEO has terminated a funding agreement or the Board or Minister has terminated a
funding approval. The new provisions are an appropriate assurance and integrity
mechanism that will allow the ARC to ensure that Commonwealth funding has been
spent as intended in accordance with an organisations' funding agreement and
funding approval. Where this has not occurred, the CEO, the Board or the Minister
may require repayment to the Commonwealth of any financial assistance paid to the
organisation.
53. New subsection 51(1) provides that financial assistance to an organisation under a
funding agreement is not payable at a time after a decision is made under
subsections 50(1), (3) or (4) to terminate the funding agreement or the funding
approval concerned. Financial assistance to an organisation will cease once the CEO
has terminated the funding agreement or the Board or the Minister has terminated
the funding approval.
54. New subsection 51(2) provides that, if the CEO makes a decision under paragraph
50(1)(a) to terminate a funding agreement covering an organisation, the CEO may
give the organisation a notice in writing:
• at paragraph (a), requiring the organisation to pay a specified amount to the
Commonwealth that is equal to the whole or a part of the financial assistance
already paid to the organisation under the funding agreement; and
• at paragraph (b), specifying the period within which the organisation must pay
that specified amount, which must be a period of at least 28 days starting on the
day on which the notice is given.
55. New subsection 51(3) provides that, if the Board or the Minister makes a decision
under subsection 50(4) or (5) to terminate a funding approval for an organisation,
the Board or Minister (as the case requires) may give the organisation a notice in
writing:
• at paragraph (a), requiring the organisation to pay a specified amount to the
Commonwealth that is equal to the whole or a part of the financial assistance
36
already paid to the organisation under the funding agreement relating to the
approval; and
• at paragraph (b), specifying the period within which the organisation must pay
that specified amount, which must be a period of at least 28 days starting on the
day on which the notice is given.
56. New subsection 51(4) provides that the matters that the CEO, Board or Minister may
consider in deciding whether it is appropriate to give a notice under subsection 51(2)
or (3) are:
• at paragraph (a), the nature of the breach of the term or condition;
• at paragraph (b), the impact of the breach on the research provided by the
organisation and on the organisation's research partners or reputation;
• at paragraph (c), the impact of the breach on Australia's reputation as a provider
of high quality research;
• at paragraph (d), the nature of any other breaches by the organisation of terms
or conditions of the funding agreement in the last 12 months.
57. New subsection 51(4) does not limit the matters that the CEO, Board or Minister
may consider. These provisions enable the CEO, Board or Minister to determine if
the organisation should repay to the Commonwealth some or all of the financial
assistance in light of the organisation's breach of the applicable terms and conditions
on which the grant of financial assistance is made.
58. New subsection 51(5) provides that, if an amount payable by the organisation under
subsection 51(2) or 51(3) remains unpaid at the end of the period specified in the
notice under that subsection, the amount:
• at paragraph (a), is a debt due to the Commonwealth; and
• at paragraph (b), may be recovered by the CEO, on behalf of the Commonwealth,
by action in a court of competent jurisdiction.
59. New subsection 51(6) provides that the CEO, on behalf of the Commonwealth, may
set off the whole or a part of the amount payable to the Commonwealth under
subsection 51(2) or 51(3) against a later payment of financial assistance to the
organisation under Division 1 in relation to another funding approval.
60. New subsection 51(7) provides that the debt under subsection 51(5) is reduced by
the amount of the set off. The set off provisions are a practical option for the
Commonwealth to recover any debts owed by an organisation.
37
61. New section 52 enables the Minister to terminate a funding approval for reasons
relevant to the security, defence or international relations of Australia and sets out
the effect this has on the payment of financial assistance.
62. New subsection 52(1) provides that the Minister may, in writing, terminate a funding
approval in relation to an organisation if the Minister considers that, for reasons
relevant to the security, defence or international relations of Australia, the approval
should be terminated. The note under the subsection explains that the Minister may
exercise this power in relation to a funding approval that has been given by the
Board under subsection 47(1) or by the Minister under subsection 48(1).
63. New subsection 52(2) provides that, if the Minister terminates a funding approval,
no further payment of financial assistance to the organisation in relation to that
funding approval is to be made under Division 1 of Part 7 of the ARC Act.
64. As recommended by the Review, the Minister can terminate a funding approval if
there are reasons relevant to the security, defence or international relations of
Australia. If the Minister exercises this power, the organisation must repay any
amount of the financial assistance determined by the Minister under subsection
52(3) to the Commonwealth. This power is being included in the ARC Act to ensure
that Australia's research sector is protected against any threats from foreign actors.
The exercise of this power will have significant consequences for an organisation. As
such, it is appropriate for the Minister, as the relevant representative of the
Commonwealth, to be empowered to make these decisions, taking advice from
relevant Commonwealth entities. It is expected that this power will only be exercised
in relation to those organisations or research projects that have ongoing national
security concerns or those specifically identified by Commonwealth entities as of
concern.
65. New subsection 52(3) provides the Minister must give the organisation written
notice of the decision under subsection 52(1) and may, in that notice:
• include a requirement for the organisation to pay a specified amount to the
Commonwealth that is equal to the whole or a part of the financial assistance
already paid to the organisation under the funding agreement relating to the
approval; and
• specify the period within which the organisation must pay that specified amount,
which must be a period of at least 28 days starting on the day on which the
notice is given.
38
66. New subsection 52(4) provides that the Minister must give the Board and CEO a copy
of the notice given to the organisation under subsection 52(3). The Minister must
give notice of such decisions to the Board so that the Board can report the number
of decisions made by the Minister in the ARC's annual report (as required by section
65A).
67. New subsection 52(5) provides that, if an amount payable by the organisation under
subsection 52(3) remains unpaid at the end of the period specified in the notice
under that subsection, the amount:
• at paragraph (a), is a debt due to the Commonwealth; and
• at paragraph (b), may be recovered by the CEO, on behalf of the Commonwealth,
by action in a court of competent jurisdiction.
68. New subsection 52(6) provides that the CEO may, on behalf of the Commonwealth,
set off the whole or a part of the amount payable to the Commonwealth under
subsection 52(3) against a later payment of financial assistance to the organisation
under Division 1 of Part 7 of the ARC Act in relation to another funding approval.
69. New subsection 52(7) provides that the debt under subsection 52(5) is reduced by
the amount of the set-off.
70. New subsection 52(8) provides that, if the operation of section 52 would result in an
acquisition of property (within the meaning of paragraph 51(xxxi) of the
Constitution) from a person otherwise than on just terms (within the meaning of
that paragraph), the Commonwealth is liable to pay a reasonable amount of
compensation to the person.
71. New subsection 52(9) further provides that, if the Commonwealth and the person do
not agree on the amount of the compensation, the person may institute proceedings
in the Federal Court of Australia for the recovery from the Commonwealth of such
reasonable amount of compensation as the Court determines.
72. Recommendation 5 of the Review specifically suggested that the Minister be
empowered to recover amounts of funding paid to organisations where a decision is
made to terminate a funding approval. Subsections 52(3) to (9) have been included
in the Bill in direct response to this recommendation. It is not guaranteed that this
power will be exercised, and, when exercising the power, the Minister will take into
account the level of risk posed by the organisation or research project and the effect
on the organisation and the research project. It is expected that this power would
only be exercised in extreme cases where the level of risk was such that it warranted
39
recovery of funds.
73. New section 53 outlines other circumstances in which financial assistance is no
longer payable to an organisation. This section provides that financial assistance to
an organisation under a funding agreement is not payable at a time after any of the
following happen:
• at paragraph (a), the organisation's involvement with the research project
concerned ends;
• at paragraph (b), the research project concerned changes so that it is no longer
consistent with the description in the funding agreement;
• at paragraph (c), the person named in the funding agreement as the person
leading the research project ceases to lead the project.
74. The matters listed in section 53 are significant changes to the research project and
would result in a funding agreement and funding approval being terminated, or
varied, depending on the circumstances. This is because these matters significantly
affect the ability of the research to continue as previously approved and outlined in
the funding agreement.
75. New section 54 sets out provisions relating to when overpayments of financial
assistance have been made to an organisation.
76. New subsection 54(1) provides that the CEO may, on behalf of the Commonwealth,
set-off the whole or a part of an overpayment of an amount of financial assistance to
an organisation under Division 1 of Part 7 of the ARC Act against another payment of
financial assistance to the organisation under Division 1.
77. New subsection 54(2) provides that, if the CEO is not able to set-off an overpayment
of an amount of financial assistance, the CEO may give the organisation a written
notice:
• at paragraph (a), specifying the amount the Commonwealth is not able to set off;
and
• at paragraph (b), requiring the organisation to pay to the Commonwealth the
amount specified in the notice; and
• at paragraph (c), specifying the period within which the organisation must pay
the amount specified in the notice, which must be a period of at least 28 days
starting on the day on which the notice is given.
78. New subsection 54(3) provides that if the organisation is required by a notice under
subsection 54(2) to pay an amount to the Commonwealth and an amount payable by
40
the organisation remains unpaid at the end of the period specified in the notice, the
amount unpaid:
• at paragraph (a), is a debt due to the Commonwealth; and
• at paragraph (b), may be recovered by the CEO, on behalf of the Commonwealth,
by action in a court of competent jurisdiction.
79. New section 55 sets out the matters that the Minister must have regard to when
making a decision under subsections 47(8), 48(6) or 52(1) about the security,
defence, or international relations of Australia. This section provides transparency as
to the matters the Minister will take into account when making these important
decisions as such decisions may result in a grant of financial assistance not being
approved, or an approval being terminated.
80. New subsection 55(1) provides that the Minister must, in deciding whether there are
reasons relevant to the security, defence or international relations of Australia, for
the making of a decision under subsection 47(8), 48(6) or 52(1), have regard to the
following:
• at paragraph (a), the nature and extent of the organisation's research activities
(if any) that are being, or have been, carried out and the financial support (if any)
the organisation has received for those activities from a foreign government
body;
• at paragraph (b), whether the organisation or a person involved in the research
project concerned has, or has had, an association with a tertiary education
institution (however described) located outside Australia and, if so, the nature of
that association;
• at paragraph (c), whether the organisation or a person involved in the research
project concerned has, or has had, an association with a foreign government
body, foreign law enforcement agency, foreign military body or foreign
intelligence agency and, if so, the nature of that association;
• at paragraph (d), whether the organisation or a person involved in the research
project concerned has, or has had, an association with a foreign country upon
which the Security Council of the United Nations or Australia has imposed a
sanction and, if so, the nature of that association;
• at paragraph (e), whether the organisation or a person involved in the research
project concerned has, or has had, an association with a person or entity
proscribed by an instrument under the Autonomous Sanctions Act 2011 and, if
so, the nature of that association;
• at paragraph (f), whether the organisation or a person involved in the research
project concerned has, or has had, an association with a proscribed person or
entity within the meaning of Part 4 of the Charter of the United Nations Act 1945
and, if so, the nature of that association.
41
81. New subsection 55(2) provides that the Minister may have regard to any other
matters that the Minister considers appropriate.
82. New section 56 sets out the Minister's obligations in relation to decisions made
under the new provisions in the ARC Act relevant to the security, defence or
international relations of Australia.
83. New subsection 56(1) provides that the Minister must give the Parliamentary Joint
Committee on Intelligence and Security (PJCIS) a written statement of any decision
under subsection 47(8), 48(6) or 52(1), and must do so as soon as practicable after
the decision was made. In the written statement, the Minister will offer to give PJCIS
a private briefing about the decision.
84. New subsection 56(2) provides that the Minister must cause a statement to be
tabled in each House of the Parliament within 15 sitting days of that House after the
day on which the Minister makes a decision under subsection 47(8), 48(6) or 52(1).
These are decisions made by the Minister to not approve a grant of financial
assistance or to terminate a funding approval for reasons relevant to the security,
defence or international relations of Australia. The statement must include:
• at paragraph (a), the day on which the Minister made the decision and the
subsection under which the decision was made; and
• at paragraph (b) a description of the research program to which the decision
relates. A description of the research program may be, for example, "the
application related to the ARC Centres of Excellence Scheme commencing 1 July
2023".
85. New section 57 provides that, to avoid doubt, the power of the Board or Minister to
approve the making of a grant of financial assistance to an organisation under
Division 1 of Part 7 of the ARC Act must be disregarded for the purpose of paragraph
32B(1)(a) of the Financial Framework (Supplementary Powers) Act 1997. The note
under this section explains that the effect of this section is to make clear that
Division 1 does not effectively limit the operation of section 32B of the Financial
Framework (Supplementary Powers) Act 1997. The Commonwealth has the power to
make, vary or administer an arrangement or grant under that section whether the
Board or Minister also has the power to approve the making of a grant of financial
assistance to an organisation under Division 1.
86. New section 58 sets out the provisions relating to the Board's preparation of funding
rules that apply to financial assistance provided under the ARC Act to organisations
approved by both the Board and the Minister. These amendments enable the
42
implementation of priorities within the ARC's allocations and funding assessment
processes by having the Board be responsible for advising the Minister on the
making of funding rules.
87. New subsection 58(1) requires that the Board must, at paragraph 58(1)(a), prepare
written rules dealing with the following:
• at subparagraph (i), the eligibility criteria to be met in order for the Board or the
Minister to approve the making of grants of financial assistance to organisations
under Division 1 of Part 7 of the ARC Act;
• at subparagraph (ii), the making of applications by organisations for such an
approval;
• at subparagraph (iii), the assessment process for deciding which applications will
receive such an approval;
• at subparagraph (iv), any other matters that the Board considers appropriate.
88. Paragraph 58(1)(b) provides that the Board must give the rules to the Minister for
approval under section 59.
89. New subsection 58(2) provides that, without limiting subparagraph 58(1)(a)(i), the
eligibility criteria may relate to the kinds of organisation that may receive financial
assistance and the kinds of research projects in respect of which financial assistance
may be approved.
90. New section 59 sets out the provisions relating to the Minister's approval of funding
rules. New subsection 59(1) provides that, after receiving rules under section 58
(including rules as revised) from the Board, the Minister must in writing either
approve the rules or request the Board to give the Minister revised rules to take
account of specified concerns of the Minister.
91. New subsection 59(2) provides that, if the Minister makes such a request, the Board
must comply with the request as soon as reasonably practicable.
92. New subsection 59(3) provides that the rules (including rules as revised) prepared by
the Board and approved by the Minister are a legislative instrument made by the
Minister on the day on which the rules are approved. The rules made under this
provision will be subject to Parliamentary scrutiny as part of the normal disallowance
processes specified in the Legislation Act 2003, and the regulations made for the
purposes of paragraph 44(2)(b) of that Act will be updated to reflect this.
43
93. New section 60 sets out provisions relating to the variation of the funding rules. New
subsection 60(1) provides that the Board may prepare a proposed variation of the
approved funding rules and give the proposed variation to the Minister.
94. New subsection 60(2) provides that, after receiving the proposed variation (including
a revised variation), the Minister must, in writing approve the variation or request
the Board to give the Minister a revised variation to take account of specified
concerns of the Minister.
95. New subsection 60(3) provides that, if the Minister makes such a request, the Board
must comply with the request as soon as reasonably practicable.
96. New subsection 60(4) provides that a variation of funding rules (including a revised
variation) prepared by the Board and approved by the Minister is a legislative
instrument made by the Minister on the day on which the variation is approved. The
varied rules made under this provision will subject to Parliamentary scrutiny as part
of the normal disallowance processes specified in the Legislation Act 2003, and the
regulations made for the purposes of paragraph 44(2)(b) of that Act will be updated
to reflect this.
Item 7: Section 63 (note)
97. Item 7 repeals the note at section 63 which is about credits to the ARC Research
Endowment Account.
98. The new note is a standard drafting note to explain that an Appropriation Act may
contain a provision to the effect that, if any of the purposes of a special account is a
purpose that is covered by an item in the Appropriation Act (whether or not the item
expressly refers to the special account), then amounts may be debited against the
appropriation for that item and credited to that special account.
Item 8: Sections 64 and 65
99. Item 8 repeals sections 64 and 65 and substitutes new section 64 to repurpose the
ARC Research Endowment Account to administer the funding of research (including
the NCGP). New section 64 specifies that the purpose of the Endowment Account is
to pay financial assistance under Division 1 of Part 7 of the ARC Act.
100. There are currently no "eligible research programs" that are approved to receive
funding under current section 64. As such, current sections 64 and 65 are no longer
needed.
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Item 9: Subsection 66(1)
101. Item 9 amends section 66 to include new delegation provisions for the Board and
the Minister, and to amend the CEO delegations.
102. Amended subsection 66(1) provides that Minister may, in writing, delegate all or
any of the Minister's powers or functions under Division 1 of Part 7 of the ARC Act
(except those under provisions covered by subsection 66(1A)) to the CEO or a
member of the staff referred to in section 41 who is an SES employee or an acting
SES employee.
103. New subsection 66(1A) provides that the Minister's powers and functions under
subsections 47(8) and 47(11), 48(1), 48(2), 48(4), 48(6) and 48(8), 50(5), 51(3) and
52(1) and 52(3) and sections 56, 59 and 60 are not able to be delegated. This is
appropriate as the relevant powers and functions relate to the approval, variation or
termination of financial assistance under Division 1, including in relation to decisions
relevant to the security, defence or international relations of Australia. These are
decisions that should be made by the Minister.
104. New subsection 66(1B) provides that the Board may in writing, delegate all or any
of the Board's powers or functions under Division 1 of Part 7 of the ARC Act (except
those provisions covered by subsection 66(1C)) to a Board member, or the CEO, or a
member of the staff referred to in section 41 who is an SES employee or an acting
SES employee.
105. New subsection 66(1C) provides that the Board's powers and functions under
subsections 47(1), 47(2) and 47(5), 50(4) and 51(3) are not able to be delegated. This
is appropriate as the relevant powers and functions specified relate to the approval,
variation or termination of financial assistance under Division 1. These are decisions
that should be made by the Board.
Items 10 and 11: Before subsection 66(2) and subsection 66(2)
106. Items 10 and 11 amend subsection 66(2) to make minor changes to the CEO's
power to delegate their functions and powers, including by removing the power to
subdelegate the CEO's powers that have been delegated by the Minister as this
power is now redundant (noting the Minister can delegate their relevant functions
and powers to the CEO and SES staff at the ARC).
Items 12 to 14: Before subsection 66(3) and subsection 66(3)
45
107. Items 12 to 14 amend subsection 66(3) to make minor changes to reflect the new
ability for the Board to delegate its powers and functions under subsection 66(1B).
Item 15: Transitional provisions--existing funding approvals
108. Item 15 is a transitional provision that sets out how the new provisions and
amendments to the ARC Act will apply to existing funding approvals.
109. Subitem 15(1) provides that subject to this item 15, Division 1 of Part 7 of the ARC
Act (including the approved funding rules under that Division), as in force
immediately before the commencement of this item (i.e. 1 July 2024), continues to
apply on and after that commencement in relation to a funding approval (within the
meaning of that Part) in force immediately before that commencement.
110. Subitem 15(2) provides that, if a funding approval referred to in subitem 15(1) (the
old approval) is in force immediately before 1 July 2025:
• subject to subitem 15(3), that Division (including the approved funding rules
under that Division) ceases to apply in relation to the old approval on and after
that day; and
• Division 1 of Part 7 of the ARC (the new Division), as substituted by Schedule 3 to
the Bill applies in relation to the old approval on and after that day as if it were:
i. if the old approval was in relation to a designated research program
within the meaning of the ARC Act as amended by Schedule 3 to the
Bill--a funding approval (the new approval) under subsection 48(1) of
the ARC Act as amended by Schedule 3 to the Bill; or
ii. otherwise--a funding approval (the new approval) under subsection
47(1) of the ARC Act as amended by Schedule 3 to the Bill; and
• no financial assistance is to be paid in relation to the new approval under the
new Division unless a written agreement, in relation to the new approval, is
entered into under subsection 49(1) of the ARC Act as amended by Schedule 3 to
the Bill.
111. This provision effectively means that the law that would have applied before the
changes being made in the Bill commenced (on 1 July 2024), including any approved
funding rules, will continue to apply to funding approvals given by the Minister until
1 July 2025. After 1 July 2025, all existing approvals will transition to the new
arrangements, with approvals being deemed to be made by either the Board or the
Minister under the new arrangements.
112. Subitem 15(3) provides that paragraphs 58(1)(c) and (d) of the ARC Act, as in force
immediately before the commencement of item 15 (i.e. 1 July 2024), continue to
46
apply on and after that commencement in relation to financial assistance paid
before 1 July 2025 in relation to the old approval. This means organisations who owe
the Commonwealth any amounts under the old provisions of the ARC Act as notified
prior to 1 July 2025, will continue to be required to repay such amounts to the
Commonwealth.
Item 16: Transitional provisions--existing funding proposals
113. Item 16 is a transitional provision that sets out how the new provisions and
amendments to the ARC Act will apply to funding proposals the ARC receives before
1 July 2024 that have not yet been decided.
114. Subitem 16(1) provides that, subject to item 16, if:
• before the commencement of item 16 (i.e. 1 July 2024), under the ARC Act an
application for financial assistance for a proposal for expenditure by an
organisation on a research program was made; and
• immediately before the commencement of item 16, the Minister had not made a
decision under section 51 of the ARC Act whether or not to approve the
proposal,
then Division 1 of Part 7 of the ARC Act (including the approved funding rules under
that Division), as in force immediately before the commencement of item 16,
continues to apply on and after that commencement in relation to that proposal and
any funding approval of that proposal by the Minister.
115. Subitem 16(2) provides that, if under that Division there is a funding approval of
that proposal and the funding approval is in force immediately before 1 July 2025:
• subject to subitem 16(3), that Division (including the approved funding rules
under that Division) ceases to apply in relation to the old approval on and after
that day; and
• Division 1 of Part 7 of the ARC Act (the new Division), as substituted by Schedule
3 to the Bill applies in relation to the old approval on and after that day as if it
were:
i. if the old approval was in relation to a designated research program
within the meaning of the ARC Act as amended by Schedule 3 to the
Bill--a funding approval (the new approval) under subsection 48(1) of
the ARC Act as amended by Schedule 3 to the Bill; or
ii. otherwise--a funding approval (the new approval) under subsection
47(1) of the ARC Act as amended by Schedule 3 to the Bill; and
iii. no financial assistance is to be paid in relation to the new approval
under the new Division unless a written agreement, in relation to the
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new approval, is entered into under subsection 49(1) of the ARC Act
as amended by Schedule 3 to the Bill.
116. This provision means that the law that would have applied before the changes
being made in the Bill commenced (on 1 July 2024) will continue to apply to funding
proposals (or applications for funding) made by organisations prior to 1 July 2024,
but not yet decided by the Minister until after 1 July 2024, and any approvals of
those proposals or applications made after 1 July 2024, until 1 July 2025. After 1 July
2025, all approvals made in relation to these applications will transition to the new
arrangements, with approvals being deemed to be made by either the Board or the
Minister under the new arrangements. All undecided applications will also transition
to the new arrangements from 1 July 2025.
117. Subitem 16(3) provides that paragraphs 58(1)(c) and (d) of the ARC Act, as in force
immediately before the commencement of item 16 (i.e. 1 July 2024), continue to
apply on and after that commencement in relation to financial assistance paid
before 1 July 2025 in relation to the old approval. This means organisations who owe
the Commonwealth any amounts under the old provisions of the ARC Act as notified
prior to 1 July 2025, will continue to be required to repay such amounts to the
Commonwealth.
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Schedule 4--Reporting
Australian Research Council Act 2001
1. Schedule 4 to the Bill amends the ARC Act to specify new requirements for the ARC
annual report. This Schedule also includes application and savings provisions to cater
for the transition from the CEO being the accountable authority to the members of
the Board being the accountable authority of the ARC.
Item 1: Part 6
2. Item 1 repeals Part 6. Annual reporting requirements will now be in Part 8
(Miscellaneous).
Item 2: Before section 66
3. Item 2 inserts a new section 65A before section 66. The title of new section 65A is
"Annual report" and the section provides that the annual report prepared by the
members of the Board and given to the Minister under section 46 of the Public
Governance, Performance and Accountability Act 2013 for a period must also:
• at paragraph (a), include particulars of any directions given by the Minister under
section 10 in that period; and
• at paragraph (b), include particulars of any directions given by the Board under
section 40B in that period; and
• at paragraph (c), specify the number of decisions made by the Minister in that
period under each of subsections 47(8), 48(6) and 52(1); and
• at paragraph (d), deal with any other matters that the Minister, by notice in
writing to the Chair, requires to be dealt with in the report.
Item 3: Application and saving provisions - annual report
4. Item 3 sets out the application provisions for the amendments made by Schedule 4.
5. Subitem 3(1) provides that paragraph 33C(3)(b) of the ARC Act, as in force
immediately before commencement of this item (i.e. 1 July 2024), continues to apply
on and after the commencement of item 3 in relation to a reporting period that
began before that commencement.
6. Subitem 3(2) provides that section 46 of the ARC Act, as in force immediately before
the commencement of item (i.e. 1 July 2024), continues to apply on and after that
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commencement in relation to a reporting period that began before that
commencement.
7. Subitem 3(3) provides that section 65A of the ARC Act, as inserted by Schedule 4 to
the Bill, applies in relation to a reporting period beginning on or after the
commencement of item 3.
8. These application provisions ensure that the existing requirements for the annual
report continue to apply for the reporting period that begins prior to
commencement of the Bill on 1 July 2024 (i.e. the financial year 1 July 2023 to 30
June 2024), noting it is likely the annual report for this period will be delivered by the
CEO after commencement of the Bill on 1 July 2024. Specifically, these provisions
ensure that the annual report for this reporting period includes the particulars of any
directions given by the Minister and is prepared by the CEO and given to the
Minister.
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Schedule 5--Transitional rules
1. Schedule 5 gives the Minister the power to make any additional transitional rules via a
legislative instrument. This power will give the Minister flexibility to address any
unforeseen transitional issues that may arise following passage of the Bill.
Item 1: Transitional rules
2. Subitem 1(1) provides that the Minister may, by legislative instrument, make rules
prescribing matters of a transitional nature (including prescribing any saving or
application provisions) relating to the amendments or repeals made by this Act.
3. Subitem 1(2) provides that, to avoid doubt, the rules may not do the following:
a. create an offence or civil penalty;
b. provide powers of:
i. arrest or detention; or
ii. entry, search or seizure;
c. impose a tax;
d. set an amount to be appropriated from the Consolidated Revenue Fund
under an appropriation in this Act;
e. directly amend the text of this Act.
4. Subitem 3(3) provides that Schedules 2 to 4 do not limit the rules that may be made
under this item.
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