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Purpose To transfer the administration of coal research and development from the Commonwealth to Australian Coal Research Limited.
Background Coal industry research and development is principally funded by an excise duty, imposed by the Excise Tariff Act 1921, on all black coal sold. Revenue raised by the research and development component of the excise duty ($0.05 per tonne on all coal sold) funds the Coal Research Trust Account (CRTA), which was established by the Commonwealth in 1978. In 1990- 91, industry contributions/excise duty to the CRTA totalled $8 205 760. 1 The Commonwealth's intention in imposing the excise duty was to boost Australia's energy research effort by supplementing and co- ordinating existing research with the specific objective of developing the technological capacity to make the best economic use of Australia's coal reserves in meeting future requirements. 2 The National Energy Research, Development and Demonstration Council (NERDDC) administers the CRTA. In 1989- 90, 45 coal- related research and development projects costing approximately $11.5 million were approved by the by NERDDC. 3
Collectively, this Bill and the Coal Tariff Legislation Amendment Bill 1992 will give effect to that part of the Government's coal industry reform package relating to coal industry research and development announced on 2 December 1991. It was announced on 2 December 1991 that the coal industry would be taking responsibility for its own research effort. The stated objective of giving the coal industry responsibility for its own research efforts is to "... provide sharper focus to coal research efforts ...". 4 In the Second Reading Speech to this Bill the Minister states that the responsibility for coal research and development will be transferred from NERDDC to a new Coal Research Council to be run by the Australian Coal Association through the company Australian Coal Research Limited. A Memorandum of Understanding has been signed between the Australian Coal Association and the Commonwealth, a copy of which is contained in the Second Reading Speech to this Bill, under which the Australian Coal Association gives certain non- binding undertakings, including: * to maintain the total level of research funding in the coal industry at the same level per tonne as would have been collected each year under the current research levy of $0.05 per tonne; * in raising this level of research funds, to take every measure to ensure that moneys raised are not substituted for specific company funded research expenditures; and * to establish a body with the appropriate legal status to assume from the Commonwealth all financial and contractual assets and liabilities associated with the CRTA, including responsibility for unfunded commitments.
Also refer to the Digest for the Coal Tariff Legislation Amendment Bill 1992 and the Coal Industry Amendment Bill 1992.
Main Provisions 'Grant agreement' is defined in clause 3 to mean: an agreement entered into by the Commonwealth, before the commencement of this Bill, for research to be done with money provided in whole, or in part, from the CRTA; and an agreement entered into by Australian Coal Limited for research to be done with money provided in whole, or in part, by the company.
The principal effects of clause 5 will be to: remove the current requirement that amounts equal to that raised by the research and development component of the excise duty on coal be payable out of the Consolidated Revenue Fund to the CRTA; allow the Minister to decide that funds
should recommence being paid into the CRTA at an amount not exceeding $0.05 per tonne of coal; and provide for the transfer of CRTA credits to the Australian Coal Research Limited.
New sections 8A- 8F will be inserted into the Coal Research Assistance Act 1977 by clause 7 that provide for the: * transfer to Australian Coal Research Limited of grant agreements (proposed section 8); * transfer to Australian Coal Research Limited of intellectual property rights currently vested in the Commonwealth under a grant agreement (proposed section 8A); * subject to disallowance by Parliament, transfer to Australian Coal Research Limited of such Commonwealth coal research assets and liabilities as determined by the Minister (proposed section 8B); * exemption of Australian Coal Research Limited from Commonwealth, State or Territory stamp duty in relation to the transfer to the company of CRTA credits, intellectual property rights and assets (proposed section 8C); * reversion to the Commonwealth, where the Minister is satisfied that it is in the interest of the Australian coal industry, or the national interest, of prescribed Australian Coal Research Limited assets and liabilities (proposed section 8D); and * payment of reasonable compensation where the operation of proposed sections 8- 8B and 8D involves the acquisition of property other than on just terms (proposed section 8F).
References 1. Department of Primary Industries and Energy, Annual Report 1990- 91, p. 329. 2. Industry Commission, Mining and Minerals Processing in Australia, Vol. 3, 27 February 1991, p. 533. 3. Ibid. 4. Minister for Primary Industries and Energy, Treasurer, Minister for Industry, Technology and Commerce and Minister for Industrial Relations, Joint Statement, 2 December 1991.
Bills Digest Service 13 May 1992 Parliamentary Research Service
For further information, if required, contact the Science, Technology and Environment Group on 06 2772420.
This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.
Commonwealth of Australia 1992.
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Published by the Department of the Parliamentary Library, 1992.