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2013 - 2014- 2015 -2016
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
NORTHERN AUSTRALIA INFRASTRUCTURE FACILITY (CONSEQUENTIAL
AMENDMENTS) BILL 2016
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Resources, Energy and Northern Australia, the
Honourable Josh Frydenberg MP)
NORTHERN AUSTRALIA INFRASRUCTURE FACILITY (CONSEQUENTIAL
AMENDMENTS) BILL 2016
OUTLINE
The Northern Australia Infrastructure Facility (Consequential Amendments) Bill (the Bill) will
amend the Export Finance and Insurance Corporation Act 1991 (the Efic Act) to provide the
Export Finance and Insurance Corporation (Efic) with the following functions:
to assist the Northern Australia Infrastructure Facility (the Facility); and
to assist, on agreement, the States and Territories.
These functions are in relation to grants of financial assistance and financial arrangements for the
construction of northern Australia economic infrastructure.
The Bill will also allow Efic to charge fees to the Facility and the States and Territories for the
services it provides in performing its functions for the Facility and the States and Territories.
The Bill enables, but does not require, the Facility to use Efic for the provision of services. By
enabling the Facility to use Efic there is the potential to utilise existing Commonwealth expertise
and provide cost-effective services for the Facility.
Similarly, allowing Efic to assist the States and Territories also provides the option to utilise
existing Commonwealth expertise.
FINANCIAL IMPACT
The Bill has no financial impact.
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
NORTHERN AUSTRALIA INFRASRUCTURE FACILITY (CONSEQUENTIAL
AMENDMENTS) BILL 2016
This 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 Northern Australia Infrastructure Facility (Consequential Amendments) Bill (the Bill) will
amend the Export Finance and Insurance Corporation Act 1991 (the Efic Act) to provide the
Export Finance and Insurance Corporation (Efic) the functions:
to assist the Northern Australia Infrastructure Facility (the Facility); and
to assist, on agreement, the States and Territories.
These functions are in relation to grants of financial assistance and financial arrangements for the
construction of northern Australia economic infrastructure.
The Bill will also allow Efic to charge fees to the Facility and the States and Territories for the
services it provides in performing its functions for the Facility and the States and Territories.
The Bill enables, but does not require, the Facility to use Efic for the provision of services. By
enabling the Facility to use Efic there is the potential to utilise existing Commonwealth expertise
and provide cost-effective services for the Facility.
Similarly, allowing Efic to assist the States and Territories also provides the option to utilise
existing Commonwealth expertise.
Human rights implications
This Bill does not engage any of the applicable rights or freedoms outlined in the Human Rights
(Parliamentary Scrutiny) Act 2011.
Conclusion
This Bill is compatible with human rights as it does not raise any human rights issues.
The Minister for Energy, Resources and Northern Australia, the
Honourable Josh Frydenberg MP
NORTHERN AUSTRALIA INFRASRUCTURE FACILITY (CONSEQUENTIAL
AMENDMENT) BILL 2016
NOTES ON CLAUSES
Part 1 - Preliminary
Clause 1 - Short Title
Specifies the short title of the Act as the Northern Australia Infrastructure Facility
(Consequential Amendment) Act 2016.
Clause 2 - Commencement
The table in this clause sets out the commencement date for when the Bill's provisions commence.
Schedule 1 of the Bill will commence immediately after the commencement of the Northern
Australia Infrastructure Facility Act 2016.
Clause 3- Schedules
This clause provides that an Act that is specified in a Schedule is amended or repealed as set out
in that Schedule and any other item in a Schedule operates according to its terms.
Schedule 1 - Amendments
Export Finance and Insurance Corporation Act 1991 (the Efic Act)
Clause 1 - Subsection 3(1)
Clause 1 inserts definitions for "EFIC's northern Australia economic infrastructure functions"
and "northern Australia economic infrastructure" into subsection 3(1)
Clause 2 - After paragraph 7(1)(d)
Clause 2 inserts new paragraphs 7(1)(da) and 7(1)(db) following paragraph 7(1)(d) of the Efic
Act. The purpose of these insertions are to give Efic additional functions to ensure Efic may
support the Northern Australian Infrastructure Facility (the Facility), and States and Territories,
in relation to the grants of financial assistance for the construction of northern Australia
economic infrastructure.
Paragraph 7(1)(da) provides Efic the function of assisting the Facility in the performance of its
functions.
Paragraph 7(1)(db) provides Efic the function of being able to agree with the States and
Territories to provide incidental assistance, to the States and Territories, in relation to financial
arrangements and agreements related to the terms and conditions of grants of financial assistance
for the construction of northern Australia economic infrastructure
It is intended that, wherever possible, all functions and support undertaken by Efic related to the
Northern Australian Infrastructure Facility Act 2016, either on behalf of the facility itself, or on
behalf of the States and Territory, will be negotiated and contracted by the Facility. Only in
circumstances where this is not possible will Efic be contracted directly by the States and
Territories to undertake support related to the Facility.
Clause 3 - At the end of section 8
Clause 3 inserts a new subsection at the end of section 8 of the Efic Act, which outlines the
primary duties of Efic. The insertion ensures that Efic may support the Facility, and the States
and Territories, without contradicting its primary duty; to facilitate and encourage Australian
export trade and related activities.
Clause 4 - At the end of section 9
Clause 4 ensures the Ministerial powers relating to entering, or not entering into a particular
contract or the giving of a particular guarantee or the making of a particular loan under the Efic
Act, do not apply to the functions it undertakes on behalf of the Facility.
Clause 5 - After section 84
Clause 5 inserts a new section 84 of the Efic Act, which enables Efic to charge the Facility, and
the States and Territory, fees for the services provided in performing its northern Australia
economic infrastructure functions. For clarity, these fees will be charged on a cost recovery basis
and such fees do not amount to taxation.
Legislation Brief - Northern Australia Infrastructure Facility Bill 2016 (the Facility Bill) and
Northern Australia Infrastructure Facility (Consequential Amendments)Bill 2016 (the
Consequential Amendments Bill)
Portfolio Resources, Energy and Northern Australia
The Hon Josh Frydenberg MP
Background The Facility was announced in the Government's 2015-16 Budget. It is a
major initiative of the Government's White Paper on Developing
Northern Australia (Our North, Our Future) and is integral to the
Government's strategy for developing the north.
Reasons and Outcomes The Facility Bill establishes the Northern Australia Infrastructure Facility
(if relevant) to make grants of financial assistance to State and Territory governments
for the purposes of developing economic infrastructure in Northern
Australia
The Facility will offer provide up to $5.0 billion in concessional finance
over five years to encourage and complement private and public sector
investment in economic infrastructure that otherwise would not be built
or would not be built for some time. The financial assistance will be
delivered in partnership with State and Territory Governments.
The Northern Australia Infrastructure Facility (Consequential
Amendments) Bill (the Consequential Amendments Bill) will amend the
Export Finance and Insurance Corporation Act 1991 (the Efic Act) to
provide the Export Finance and Insurance Corporation (Efic) with the
following functions:
to assist the Northern Australia Infrastructure Facility (the
Facility); and
to assist, on agreement, the States and Territories.
Financial implications The cost of administering the Facility, which will provide up to $5.0 billion
in financial assistance for the construction of infrastructure projects in
Northern Australia, is estimated to be $39.7 million over a five year
period commencing in 2016-17. These costs will be recovered through
fee revenue, estimated to be $40.2 million over the same period.
The Consequential Amendments Bill has no financial impact on the
Commonwealth.
Timing Passage and introduction prior to the end of May 2016
Reasons for timing The Bill must be passed before the end of May 2016.
This is to allow the Facility to be established and the Board appointed
prior to loan decisions being made from 1 July 2016.
The ability to make loans from 1 July 2016 is consistent with the
Government's 2015-16 Budget commitment and a decision by Cabinet.
Minister's Office Office of the Hon Josh Frydenberg MP, Minister for Resources, Energy
and Northern Australia