Commonwealth of Australia Explanatory Memoranda

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ASSET RECYCLING FUND BILL 2014

                           2014




THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA




                         SENATE




           ASSET RECYLING FUND BILL 2014




    SUPPLEMENTARY EXPLANATORY MEMORANDUM




   Amendments to be moved on behalf of the Government




    (Circulated by the authority of the Minister for Finance,
              Senator the Hon Mathias Cormann)
ASSET RECYCLING FUND BILL 2014

GENERAL OUTLINE

The Asset Recycling Fund Bill 2014 (the Bill) establishes the Asset Recycling
Fund (ARF) as a dedicated vehicle for providing financial incentives to States
and Territories to invest in infrastructure that contributes to a more prosperous
economy. Payments from the ARF will also support investment in
nation-building infrastructure and local initiatives, such as the Roads to
Recovery Programme administered by the Department of Infrastructure and
Regional Development.

The Bill passed the House of Representatives on 19 June 2014 and was
introduced to the Senate on 23 June 2014. The Senate referred the Bill and
accompanying Asset Recycling Fund (Consequential Amendments) Bill 2014
to the Senate Finance and Public Administration Legislation Committee (the
Committee) for enquiry and report by 16 June 2014. The Committee
recommended the Bill be passed in its current form.


The proposed amendments to the Bill are necessary to update the
commencement date and to address a number of other matters, primarily as a
consequence of the delayed commencement.

FINANCIAL IMPACT STATEMENT

The amendments to the Bill have no financial impact.

STATEMENT OF COMPATABILITY WITH HUMAN RIGHTS


The amendments to the Bill do not:

       engage any of the applicable rights or freedoms outlined in the Human
       Rights (Parliamentary Scrutiny) Act 2011, such as encompassed in the
       International Covenant on Civil and Political Rights; or

       limit any human rights, nor propose any offences or penalties.


This Bill, including the amendments, is therefore compatible with the human
rights and freedoms recognised or declared in the international instruments
listed in subsection 3(1) of the Human Rights (Parliamentary Scrutiny)
Act 2011.




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NOTES ON AMENDMENTS

Item 1 updates clause 2 of the Bill to provide that the Bill will commence on the
day after it receives Royal Assent.


Items 2 and 3 amend clause 4 of the Bill to take into account that the Public
Governance, Performance and Accountability Act 2013 (the PGPA Act) came
into effect from 1 July 2014. The amendments substitute references to the
Financial Management and Accountability Act 1997 (the FMA Act) with
references to the PGPA Act.


Item 4 and 5 amend subclause 8(10) to clarify that the Commonwealth can
only make payments where it is permissible to do so under its Executive
Power.


Item 6 amends clause 12 of the Bill to substitute references to the FMA Act
with references to the PGPA Act.


Item 7 amends clause 12 of the Bill to update references to special accounts in
order to provide consistency with the terminology of the PGPA Act.


Items 8 and 9 amend clause 13 of the Bill to give the Future Fund Board of
Guardians (the Board) 28 days from commencement of the Bill to give effect to
the transfer of money from the Building Australia Fund (BAF) and the
Education Investment Fund (EIF).


Items 10 and 11 amend the notes to clauses 16 and 17 of the Bill to substitute
references to the FMA Act with references to the PGPA Act.


Item 12 amends clause 21 to require States and Territories to be bound by the
terms and conditions of a written agreement under which a grant of financial
assistance is provided.


Items 13 and 14 amend clause 22 of the Bill to substitute references to the
FMA Act with references to the PGPA Act, and to ensure the definition of a
special account is consistent with the terminology of the PGPA Act.


Item 15 amends the note to clause 23 of the Bill to substitute references to the
FMA Act with references to the PGPA Act.


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Item 16 amends clause 27 of the Bill to require funding recipients to be bound
by the terms and conditions of a written agreement under which a grant of
financial assistance is provided.


Item 17 amends clause 28 of the Bill to require funding recipients to be bound
by the terms and conditions of a written agreement under which they receive a
payment.


Items 18 and 19 amend clause 34 of the Bill to give the Board 28 days from
the commencement of the Bill to give effect the transfer of financial assets from
the BAF and the EIF.


Item 20 amends clause 35 of the Bill to replace references to section 39 of the
FMA Act with references to section 58 of the PGPA Act. This amendment will
enable the Board to appropriately make and manage ARF investments as
required by the PGPA Act.


Item 21 removes clause 47 of the Bill, which makes reference to section 40 of
the FMA Act. There is no equivalent provision in the PGPA Act.




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