STATES GRANTS (RURAL ADJUSTMENT) ACT 1976 No. 201, 1976
STATES GRANTS (RURAL ADJUSTMENT) ACT 1976 No. 201, 1976 - SECT. 1. Short title.
STATES GRANTS (RURAL ADJUSTMENT) ACT 1976 No. 201 of 1976 An Act relating to an Agreement between the Commonwealth and one or more of the States in respect of a Scheme to provide Assistance to Persons engaged in Rural Industries. BE IT ENACTED by the Queen, and the Senate and House of Representatives of the Commonwealth of Australia, as follows:- 1. This Act may be cited as the States Grants (Rural Adjustment) Act 1976.*1* STATES GRANTS (RURAL ADJUSTMENT) ACT 1976 No. 201, 1976 - SECT. 2. Commencement.
2. This Act shall come into operation on the day on which it receives the Royal Assent.*1* STATES GRANTS (RURAL ADJUSTMENT) ACT 1976 No. 201, 1976 - SECT. 3. Approval of execution of agreement.
3. The execution, on behalf of the Commonwealth, of an agreement between the Commonwealth and all or any of the States substantially in accordance with the form set out in the Schedule to this Act is approved. STATES GRANTS (RURAL ADJUSTMENT) ACT 1976 No. 201, 1976 - SECT. 4. Appropriation for financial assistance.
4. The payments by the Commonwealth to a State provided for in the agreement referred to in section 3 may be made to that State, by way of financial assistance, on the terms and conditions contained in that agreement, out of moneys appropriated by the Parliament for the purpose. ----------- STATES GRANTS (RURAL ADJUSTMENT) ACT 1976 No. 201, 1976 - THE SCHEDULE
THE SCHEDULE Section 3 AN AGREEMENT made the day of One thousand nine hundred and seventy- between- THE COMMONWEALTH OF AUSTRALIA (in this agreement called ''the Commonwealth'') of the first part, THE STATE OF NEW SOUTH WALES of the second part, THE STATE OF VICTORIA of the third part, THE STATE OF QUEENSLAND of the fourth part, THE STATE OF SOUTH AUSTRALIA of the fifth part, THE STATE OF WESTERN AUSTRALIA of the sixth part, and THE STATE OF TASMANIA of the seventh part. WHEREAS- (A) the Commonwealth and the States recognize that there is need to provide assistance to persons engaged in rural industries throughout Australia in the interest of those industries and of Australia generally; (B) Ministers of the Commonwealth and of the States have agreed upon the Outline of Scheme for Rural Adjustment set out in the Schedule to this agreement as constituting a Scheme under which assistance of various kinds could be provided; (C) the carrying out of the said Scheme is dependent upon financial assistance being granted by the Parliament of the Commonwealth to the States for that purpose; (D) the Parliament of the Commonwealth has authorized the execution of this agreement by and on behalf of the Commonwealth and the provision of financial assistance to the States as provided in this agreement; NOW IT IS HEREBY AGREED as follows: I-INTRODUCTION Operation of Agreement 1. (1) This agreement shall, as between the Commonwealth and a State, come into force when it has been entered into by the Commonwealth and that State. (2) Notwithstanding that all the States of New South Wales, Victoria, Queensland, South Australia, Western Australia and Tasmania are named as parties to this agreement, this agreement shall operate as an agreement between the Commonwealth and each State in respect of which it has come into
Back to Top
force as fully and effectually as if the State or States in respect of which it has come into force were the only State or States named as a party or as parties to the agreement. (3) In this agreement, each State in respect of which the agreement has come into force is referred to as a ''State'', and the expression ''the States'' means, except where the context otherwise requires, all of the States in respect of which for the time being the agreement is in force. Performance of Agreement 2. The Commonwealth will provide for or secure the performance by it and its authorities of the obligations of the Commonwealth under this agreement and each of the States will provide for or secure the performance by the State and its authorities and instrumentalities of the obligations of the State under this agreement. Interpretation 3. (1) In this agreement, unless the contrary intention appears- ''financial year'' means a period of twelve months ending on the 30th day of June; ''the Authority'' means the authority or authorities of a State that has or have the administration of the Scheme on behalf of the State and, in a case where there is more than one authority, refers, where the context requires reference to one authority, to the relevant authority of the State; ''the Scheme'' means the scheme to be established and operated by a State in accordance with clause 4; ''the Treasurer'' means the Treasurer of the Commonwealth. (2) Reference in this agreement to a Minister of the Commonwealth or of a State shall include a reference to a Minister for the time being acting for or on behalf of the Minister referred to. (3) In this agreement, except where the context otherwise requires- (a) a reference to a clause refers to the relevant clause of this agreement; (b) a reference to a sub-clause refers to the relevant sub-clause of the clause in which the reference appears; and (c) the Schedule to this agreement shall be deemed to be an integral part of this agreement. II-ADMINISTRATION OF SCHEME State to operate Scheme 4. (1) Each State will, by using the financial assistance provided by the Commonwealth in accordance with this agreement, establish and operate a scheme of financial assistance to persons engaged in rural industries in that State. (2) The Scheme shall consist of the forms of assistance described in, and shall be operated in conformity and in accordance with the general principles and the provisions set out in, the Outline of a Scheme for Rural Adjustment contained in the Schedule to this agreement, as amended at any time in pursuance of sub-clause 9 (1). (3) The Scheme shall commence operation on the 1st day of January 1977. Forms of Assistance 5. For the purposes of this agreement the various forms of assistance under the Scheme are referred to as follows: PART A (a) the assistance provided for in Part 2 of the Schedule-as debt reconstruction. (b) the assistance provided for in Part 3 of the Schedule-as farm build-up. (c) the assistance provided in Part 4 of the Schedule-as farm improvement. (d) the assistance provided for in Part 5 of the Schedule-as rehabilitation. PART B (e) the assistance provided for in Part 6 of the Schedule-as carry-on finance. PART C (f) the assistance provided for in Part 7 of the Schedule-as household support. Allocation of Financial Assistance 6. (1) Subject to the provisions expressly made by this agreement, the financial assistance that is to be made available by the Commonwealth to a State under this agreement for the forms of assistance referred to in paragraphs (a), (b) and (c) of Part A of clause 5 shall be allocated between those forms of assistance in such proportions as the Commonwealth determines after consultation with the State.
Back to Top
(2) A determination by the Commonwealth for the purposes of sub-clause (1) shall specify a target percentage for commitments on farm build-up and on farm improvement which the State shall endeavour to achieve and a maximum percentage for commitments on debt reconstruction which the State may not exceed without the prior approval of the Commonwealth. (3) The consultations referred to in sub-clause (1) shall extend to establishing by agreement between the Commonwealth and the State a firm program of commitments of financial assistance for each four-monthly period during the year. (4) If during a financial year either the Commonwealth or a State informs the other that it considers the allocation of the financial assistance by the State or the program of commitments in respect of the year should be varied, further consultations will be held between the Commonwealth and the State with a view to varying the determination by the Commonwealth for the purposes of this clause should the Commonwealth see fit to do so or varying the program of commitments for the purposes of this clause as the case may be. Interest rates for Parts A and C Assistance 7. (1) The rates of interest at which money is lent by the Authority under the Scheme in providing the forms of assistance referred to in Part A and Part C of clause 5 shall be as determined by the Authority in the circumstances of the particular case. (2) The Authority shall have the right to review the terms of repayment, including interest rates, of individual accounts at any time and shall exercise this right at regular intervals with the objective of the borrower being encouraged to transfer to commercial credit as soon as circumstances permit. Administration Expenses 8. (1) The Commonwealth and each State shall bear the administration expenses of the provision by the State of assistance referred to in Parts A and C of clause 5 as follows- (a) up to the amount in each year which is equivalent to 2 per centum in value of the approvals for those forms of assistance in that year-by the Commonwealth and the State equally; and (b) in excess of the amount in each year which is equivalent to 2 per centum in value of the approvals for those forms of assistance in that year-by the State. (2) The Commonwealth and each State shall bear the administration expenses of the provision by the State of assistance referred to in Part B of clause 5 in the respective proportions that assistance is for the time being provided by the Commonwealth and the State in respect of the relevant industry in accordance with the agreement which establishes the relevant proportion of the assistance in respect of that industry referred to in sub-clause 14 (2). Amendment of Schedule 9. (1) The provisions of the Schedule to this agreement may be amended from time to time by agreement between the Ministers of the Commonwealth and of the States for the time being responsible for the administration of the Scheme. (2) Where so agreed between the Commonwealth Minister and the Minister or Ministers of the relevant State or States, any amendments to the provisions of the Schedule to this agreement may be made and take effect as between the Commonwealth and one or more of the States without affecting the operation of this agreement as between the Commonwealth and a State the Minister of which has not so agreed. III-FINANCIAL ASSISTANCE Provisions of Financial Assistance 10. Subject to, and to the performance by a State of, the provisions of the agreement, the Commonwealth will make financial assistance available to the States for the purposes of the Scheme. Amount of Financial Assistance 11. (1) The amount of financial assistance to be made available by the Commonwealth to each State for the forms of assistance referred to in Parts A and C of clause 5 during a financial year shall be determined by the Commonwealth before the commencement of the financial year following a meeting of Commonwealth and State Ministers which will review the circumstances relating to the financial year and which will give due consideration to submissions made by the States not later than the end of February last preceding the financial year and will have regard to such other criteria as the Commonwealth considers appropriate. (2) The amount of financial assistance to be made available by the Commonwealth to a State for the forms of assistance referred to in Part B of clause 5 shall be determined at the time the Commonwealth and the State agree that the provision of such assistance is warranted. Advances
Back to Top
12. (1) The Treasurer may, at such time and in such amounts as he thinks fit, make advances on account of the payment that may be made by the Commonwealth under clause 14. (2) An amount or part of an amount advanced by the Treasurer under this clause may be deducted by the Commonwealth from an amount that subsequently becomes payable under clause 14 or, if no further amounts will become payable under that clause, shall be refunded by the State to the Commonwealth at the request of the Treasurer. Use of Advances 13. A State shall ensure that an amount or any part of an amount advanced to the State and not refunded under the last preceding clause is not used or applied except for the operation of the Scheme. Payments of Financial Assistance 14. The Commonwealth shall, from time to time, at the request of a State and subject to the provisions of this agreement, make payments to the State of the financial assistance to be provided to the State under this agreement: (1) (a) in respect of the forms of assistance referred to in Parts A and C of clause 5 in amounts equal to the expenditure by the State (other than administration expenses) in the provision of those forms of assistance; and (b) in respect of the forms of assistance referred to in Part B of clause 5 in amounts equal to the relevant proportion of the expenditure by the State (other than administration expenses) in the provision of that form of assistance. (2) For the purposes of paragraph (b) of sub-clause (1) ''the relevant proportion'' means the proportion of the total cost of operation of the form of assistance referred to in Part B of clause 5 as is from time to time agreed between the Commonwealth and the State as being the proportion to be provided by the Commonwealth. Supporting Financial Evidence 15. (1) A State shall furnish to the Treasurer such documents and other evidence to justify the making of an advance under clause 12 or in support of a request by the State for a payment to it by the Commonwealth under the last preceding clause as the Treasurer may from time to time reasonably request, whether the request by the Treasurer is made before or after the Commonwealth has made the advance or a payment pursuant to the request by the State. (2) Any statement of expenditure by a State furnished to the Treasurer in connexion with a request by the State for a payment under clause 14 shall be certified by the Auditor-General of the State or an officer authorized by the Treasurer of the State as to its correctness in accordance with the books and documents of the Authority. Interest on Part A Assistance 16. (1) Interest at the rate for the time being applicable under this clause shall accrue in respect of so much of each amount that has been advanced or paid to the State in respect of the forms of assistance referred to in Part A of clause 5 as is repayable by the State under clause 17 and has not for the time being been refunded or repaid to the Commonwealth, calculated from the date upon which the advance or payment was made by the Commonwealth. (2) The rate of interest referred to in sub-clause (1) shall be 7 per centum per annum but shall be subject to renegotiation and redetermination at an annual review of the Scheme to the intent that, in the event that as at the 1st day of January preceding the review there has been a variation of the long term bond rate of 20 per centum or more of the long term bond rate as at the 1st day of January 1977 or the 1st day of January when the rate of interest was last redetermined, as the case may be, the rate applicable under this clause shall be redetermined having regard to the extent of that variation. (3) A redetermination of the rate of interest under sub-clause (2) shall take effect on a date to be specified by the determination. (4) A reference in sub-clause (2) to the long term bond rate is a reference to the rate that is equivalent to the rate of yield to maturity of the long term loan of the loan raising by the Commonwealth in Australia for public subscription last preceding the date to which the reference relates. (5) Interest that accrues under this clause prior to the date upon which interest becomes included in payments provided for in clause 17 shall be payable on the 15th day of January and the 15th day of July each year. Repayments with Interest of Part A Assistance 17. (1) Subject to the provisions of clause 20, each State shall repay to the Commonwealth 85 per centum of each of the advances made to the State in respect of the forms of assistance referred to in Part A of clause 5 and not refunded or repaid under clause 12 and each of the payments made to the State under clause 14 and not for the time being repaid, together with interest referred to in sub-clause (3) of this clause by 34 half-yearly payments, that, subject to any variation resulting from a redetermination of the rate of interest under clause 16, are equal in amount. (2) The first payment under sub-clause (1) shall be made on the 15th day of July of the fourth financial year that wholly occurs after the advance or
Back to Top
payment was made by the Commonwealth to the State and subsequent payments shall be made on each 15th day of January and 15th day of July thereafter until the full amount of the repayment, including interest, has been paid. (3) The interest to be included in payments referred to in sub-clause (1) shall be the interest that, in accordance with sub-clauses (1) and (2) of clause 16, accrues in respect of the relevant advance or payment on and from the 15th day of January preceding the commencement of the fourth financial year that wholly occurs after the advance or payment was made by the Commonwealth. Repayments of Part B Assistance 18. (1) Each State shall, by way of repayment of the form of assistance referred to in Part B of clause 5 pay to the Commonwealth by payments in accordance with sub-clause (3) the amount that is calculated by subtracting (b) from (a) where- (a) is the amount which is the relevant proportion of the principal and interest repaid to the Authority by the recipients of that assistance; and (b) is the amount which is the relevant proportion of the administration expenses of the Authority in providing that assistance. (2) For the purposes of sub-clause (1) ''the relevant proportion'' means the proportion of the total cost of the provision of the form of assistance referred to in Part B of clause 5 as is from time to time agreed between the Commonwealth and the State as being the proportion to be provided by the Commonwealth. (3) The State shall pay to the Commonwealth so much as is from half-year to half-year calculated to be payable of the amount first referred to in sub-clause (1) by consecutive half-yearly payments, the first payment to be made on the 15th day of July or January that occurs after the first repayment of principal and interest made by a recipient of the assistance to the Authority and subsequent payments to be made on each succeeding 15th day of January and July thereafter until no further amount is payable by the State in pursuance of its obligation under sub-clause (1). Repayments of Part C Assistance 19. Each State shall, by way of repayment of the form of assistance referred to in Part C of clause 5, pay to the Commonwealth so much of that assistance and interest thereon as is recouped by the State in any year from the recipients of that assistance, such payments to be made on each 15th day of January and 15th day of July next succeeding the receipt of those moneys by the State. Prepayments by State 20. (1) In addition to making payments in accordance with clause 17, a State may on the 15th day of January or on the 15th day of July in any year, after having given to the Treasurer notice in writing of at least one month of its intention to do so, pay to the Commonwealth an amount that has been specified in the notice of the repayments that remain to be made by the State under that clause. (2) Interests shall accrue on amounts paid by a State in accordance with sub-clause (1) at the rate that is for the time being the rate of interest applicable under clause 16 calculated from the date of payment and compounded with half-yearly rests on each 15th day of January and 15th day of July. (3) When on any 15th day of January or 15th day of July the payment by the State under clause 17 exceeds the amount by which the unrepaid balance of the total amount repayable under that clause together with interest accrued on that total amount up to and including that date exceeds the total of the amounts paid by the State to the Commonwealth in accordance with sub-clause (1) together with interest accrued on those amounts up to and including that date under sub-clause (2), the State shall pay to the Commonwealth the amount of the second-mentioned excess in lieu of the amount due under clause 17 and no further payments shall be required to be made by the State to the Commonwealth under that clause. Financial Administration and Adjustments 21. (1) Each State agrees that in respect of the forms of assistance referred to in Part A of clause 5 the Scheme shall be operated by the State in such a way that the amounts received by the Authority in the course of the operation of the Scheme could be reasonably expected to equal the payments of principal and interest which the State is required to make to the Commonwealth under this agreement. (2) Should a State certify that, without taking into account its administration expenses, it has incurred losses under the Scheme in respect of the form of assistance specified in Part A of clause 5 from circumstances beyond its control arising after the date of this agreement, the Commonwealth agrees to review the position with the State with a view to adjusting amounts payable to the Commonwealth by the State under this agreement to the extent of such losses. (3) The provisions of this agreement in relation to the times at which payments are to be made by the State to the Commonwealth and the amounts of
Back to Top
the payments that are to be made may be varied in such manner as is agreed between the Commonwealth and the State upon a review carried out in accordance with sub-clause (2). Audit 22. (1) The accounts, books, vouchers, documents and other records of a State relating to the operation of the Scheme shall be subject to audit by the Auditor-General of the State. (2) A report on the audits in respect of each financial year shall be furnished by the Auditor-General of the State to the Treasurer as soon as possible after the completion of the financial year. Other Financial Arrangements 23. Financial arrangements in connection with the Scheme other than those provided for in this agreement shall be carried out as agreed from time to time between the Treasurer and Treasurer of each State. IV-GENERAL Review 24. The operation of the Scheme in relation to all of the States will be reviewed from time to time as appropriate by the Commonwealth and the States in the light of experience in its administration. Exchange of Information 25. The Authorities of the States and appropriate Commonwealth officers associated with the Schemes for Rural Adjustment will meet together as appropriate and at least once in each year and exchange information on any matters pertinent to the Schemes. Provision of Information and Review 26. The Authority will supply to the Commonwealth from time to time such information regarding the operation of the Scheme by the State as may be requested by the Commonwealth and which is reasonably able to be supplied by the Authority and will participate in periodic reviews of the effectiveness of the Scheme. THE SCHEDULE RURAL ADJUSTMENT-OUTLINE OF SCHEME PART 1-GENERAL PRINCIPLES (a) All agricultural, horticultural and pastoral industries are included in the Scheme. It is recognised that in particular circumstances some industries may need additional special consideration. (b) The general principle to be applied is to distribute the available resources as widely as practicable, but the over-riding objective is to help restore to economic viability those farms and farmers with the capacity to maintain viability once achieved. (c) It is expected that each administering authority will avail itself of the best available advice on agricultural technology and market prospects. (d) Companies will not be eligible for assistance unless the Authority, having considered the shareholdings and being satisfied that the shareholders are bona fide primary producers relying primarily on the income of the company for their livelihood, considers it appropriate to provide assistance. (e) In cases of assistance under the heading of debt reconstruction or by way of advances for carry-on expenses, plant, livestock and property development, it is an essential part of the Scheme that adequate supervision of property management and the financial affairs of the assisted farmer is maintained. If the Authority deems it necessary, it may require that moneys receivable on account of the property will be received by the Authority or its agent or a body nominated by the Authority, payments within the approved budgets being made through normal channels. (f) Repayment of advances made by the Authority and interest due thereon will be secured by the best and most appropriate security available, recognising that this may involve ranking after existing securities. (g) A transfer of the property or any interest therein before advances made by the Authority are repaid will be permitted only with the consent of the Authority, which will upon transfer, or upon succession on the death of the borrower, have the right to review its arrangements in respect of the property. (h) The arrangements with the assisted farmer will be subject to regular
Back to Top
review by the Authority from time to time. They may be terminated if the farmer ceases to work the property personally, fails to observe his obligations and undertakings under the arrangements or if the Authority decides that for any reason he lacks reasonable prospects of successful economic operation. Otherwise the arrangements shall be terminable when the Authority decides that his prospects of successful economic operation are no longer dependent on the extension of concessional finance. Upon termination of the arrangements, all debts will then become due and payable. (i) The eligibility of a farmer for one form of assistance under this Scheme will not necessarily be affected by his having applied for or received another form of assistance under the Scheme. (j) The rate of interest payable will be decided by the Authority in the circumstances of the particular case. The Authority will have the right to review the interest rates on individual accounts at any time and shall review the terms of repayment, including interest rates, at regular intervals with the objective of the borrower being encouraged to transfer to commercial credit as soon as circumstances permit. PART 2-DEBT RECONSTRUCTION