Ed Husic (Chifley, Australian Labor Party, Minister for Industry and Science) Share this | Hansard source

I present the explanatory memorandum to this bill and move:

That this bill be now read a second time.

The Financial Framework (Supplementary Powers) Amendment Bill 2024 (the bill) amends the Financial Framework (Supplementary Powers) Act 1997 (the FFSP Act) to remove certain limiting words from section 32B and section 39B.

Section 32B of the FFSP Act confers power on the Commonwealth to make, vary or administer an arrangement or grant, where relevantly specified in the Financial Framework (Supplementary Powers) Regulations 1997 (FFSP regulations), in circumstances where 'apart from this subsection, the Commonwealth does not have power to make, vary or administer' the arrangement or grant (paragraph 32B(1)(a)).

Section 39B of the FFSP Act contains similar words in relation to the specified activities in respect of a company.

The FFSP framework was established in response to the Williams decision by the High Court. The High Court determined that the Commonwealth expenditure will only be valid if:

Section 32B was inserted into the then Financial Management and Accountability Act 1997 (currently the FFSP Act) to provide legislative authority for existing and future Commonwealth programs.

The FFSP framework has supported a broad range of spending via arrangements or grants, including emergency payments during the COVID-19 pandemic, and the 2020 bushfires and floods.

The amendments will put beyond doubt that the FFSP framework operates consistently with how it has been understood to operate, including in circumstances where another general spending power may be available. The amendments would clarify the operation of the FFSP framework and confirm the validity of government spending programs that rely on section 32B of the FFSP Act, as well as any government involvement in companies in reliance on section 39B of the FFSP Act, in circumstances where other general powers could also be relied on.

This bill also includes validation and savings provisions to regularise past spending and government activities in reliance on sections 32B and 39B, in the event that any such past spending or activity may not have been valid because there was an alternate source of legislative authority.

The changes in this bill simply clarify the position to what has always been the common understanding.

Leave granted for second reading debate to continue immediately.

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