2013-2014

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

(Circulated by the authority of the

Treasurer, the Hon J. B. Hockey MP)

 

Glossary.............................................................................................................. 1

General outline and financial impact............................................................ 3

Chapter 1            Abolishing the Clean Energy Finance Corporation......... 5

Index................................................................................................................. 19

 

The following abbreviations and acronyms are used throughout this explanatory memorandum.

Abbreviation	Definition
ARENA Act	Australian Renewable Energy Agency Act 2011
Bill	Clean Energy Finance Corporation (Abolition) Bill 2014
CAC Act	Commonwealth Authorities and Companies Act 1997
CEFC	Clean Energy Finance Corporation
CEFC Act	Clean Energy Finance Corporation Act 2012
CER Act	Clean Energy Regulator Act 2011
FMA Act	Financial Management and Accountability Act 1997
SES	Senior Executive Service

Abolishing the Clean Energy Finance Corporation

The purpose of the Clean Energy Finance Corporation (Abolition) Bill 2014 (Bill) is to give effect to the Government’s commitment to abolish the Clean Energy Finance Corporation (CEFC).  The Bill repeals the Clean Energy Finance Corporation Act 2012 (CEFC Act).

The Bill contains arrangements to ensure the orderly administration of investments and transfer of the existing contractual assets and liabilities of the CEFC to the Commonwealth to hold and manage. 

Date of effect :  The Bill generally commences on a day to be fixed by proclamation or six months following Royal Assent, whichever is earlier. 

Proposal announced :  The policy to repeal the CEFC Act was announced as a 2013 election commitment.

Financial impact :   Based on advice from the CEFC, the financial impact of abolishing the CEFC has the following fiscal balance and underlying cash balance implications over the forward estimates ($millions):

	2014-15	2015-16	2016-17	2017-18	Total
Underlying cash balance	- $10.2m	- $46.4m	- $99.3m	- $192.6m	- $348.5m
Fiscal Balance	$18.6m	- $16.9m	- $72.2m	- $143.5m	- $214.0m

These estimates do not make any allowance for the costs of shutting down the CEFC, such as employee redundancies and contract termination costs, which if included would increase the financial impact over the forward estimates.

The estimates also do not include the impact of lower public debt interest costs from ceasing further contributions from the Government to the CEFC, nor allowances for bad and doubtful debts, which if included would reduce the financial impact over the forward estimates.

As government policy, abolition of the CEFC was reflected in the 2014-15 Budget and, therefore, the actual impact on the budget bottom line has already been reflected.

Underlying cash balance

The overall impact on the underlying cash balance is negative, reflecting that no further CEFC investments will be made and therefore interest inflows will be lower.  The estimates presented in the above table show a higher cost of abolishing the CEFC than previously estimated.  This is because the CEFC has been in operation for a longer period of time and, in this time, returns have been higher than previously expected.  It should be noted that these estimates are based on the CEFC’s current performance.

Fiscal Balance

The net impact on the fiscal balance is negative, reflecting that no further CEFC investments will be made and therefore interest inflows will be lower.

Previous estimates showed a positive impact, despite reduced interest inflows, reflecting the large, negative, upfront fiscal impacts of concessional loans.  CEFC investments to date suggest a lower issuance of concessional loans. 

Human rights implications :  This Bill does not raise any human rights issues.  See Statement of Compatibility with Human Rights — Chapter 1, paragraphs 1.103 to 1.106.

Compliance cost impact :  This measure does not raise any compliance cost issues. 

 

Summary of new law

1.1                   The Clean Energy Finance Corporation (Abolition) Bill 2014 (Bill) repeals the Clean Energy Finance Corporation Act 2012 (CEFC Act), makes consequential amendments to remove references to the Clean Energy Finance Corporation (CEFC) in the Australian Renewable Energy Agency Act 2011 (ARENA Act) and the Clean Energy Regulator Act 2011 (CER Act) and provides transitional provisions which transfer the CEFC’s assets and liabilities, both investment and otherwise, to the Commonwealth. 

Detailed explanation of new law

Short title

1.2                   This clause provides that the name of the Bill, if enacted, is the Clean Energy Finance Corporation (Abolition) Act 2014 .  [Clause 1]

Commencement

1.3                   This clause outlines the commencement of different Parts of the Bill.  As outlined below, Parts of the Bill take effect on Royal Assent while other Parts of the Bill take effect by Proclamation or six months following Royal Assent, whichever is earlier.  [Clause 2]

1.4                   Schedule 1, Parts 1 and 2 repeal the CEFC Act, makes amendments to the ARENA Act and the CER Act.  It also commences the transitional provisions associated with transferring the assets and liabilities of the CEFC to the Commonwealth on a day to be fixed by proclamation or six months following Royal Assent, whichever is earlier.  The intention of this transitional period of up to six months is to ensure that there is certainty for CEFC employees, contractors and financial partners and to ensure time is allowed to prepare for the transfer of assets and liabilities to the Commonwealth.  [Schedule 1, Parts 1 and 2]

1.5                   Schedule 1, Part 3, Division 6 of the Bill relating to the quarterly investment report commences upon Royal Assent.  This is to ensure that the CEFC has time to complete its quarterly investment reporting obligations before the CEFC Act is repealed.  [Schedule 1, Part 3, Division 6]

1.6                   Schedule 1, Part 3, Division 9 of the Bill relating to the CEFC’s transitional function commences upon Royal Assent.  This allows the Treasury, who will manage the CEFC’s existing investments on behalf of the Commonwealth, to prepare for an orderly transition of the investments, ensure increased continuity and knowledge transfer, and minimise disruption to the clean energy market.   [Schedule 1, Part 3, Division 9]

1.7                   Schedule 1, Part 3, Division 9 of the Bill also provides for the Minister to make rules in relation to transition matters from Royal Assent. Unless otherwise specified, all references in this document to the Minister are references to the Treasurer, unless otherwise specified.   [Schedule 1, Part 3, Division 9]

1.8                   Schedule 1, Part 3, Division 9 of the Bill also provides for the Minister to make rules in relation to transition matters from Royal Assent.   [Schedule 1, Part 3, Division 9]

1.9                   Schedule 1, Part 4 relating to the repeal of the CEFC Transitional Special Account commences the day after the CEFC Transitional Special Account is reduced to nil.  The Minister must announce the repeal day by notice in the Gazette .  [Schedule 1, Part 4]

Schedule(s) have effect according to terms

1.10               This clause provides that each Act that is specified in a Schedule to this Act is amended or repealed as set out in the Schedule concerned and any other item in a Schedule to this Act has effect according to its terms.  [Clause 3]

Schedule 1 — Amendments

1.11               Schedule 1 contains the amendments for this Bill, including the repeal of the CEFC Act, consequential amendments, transitional provisions and the repeal of the CEFC Transitional Special Account.

Repeal

1.12               Schedule 1, Part 1 of this Bill repeals the whole of the CEFC Act.  [Schedule 1, Part 1, item 1]  

1.13               The CEFC is a body corporate created under statute and repealing the CEFC Act abolishes the CEFC.  As a result of this repeal, all regulations and legislative instruments made under the CEFC Act are also repealed.  This includes the CEFC Investment Mandate Direction 2013. 

Consequential amendments

1.14               Schedule 1, Part 2 of this Bill makes consequential amendments to the ARENA Act and the CER Act. 

1.15               Item 2 repeals section 73A of the ARENA Act which allows information to be disclosed from ARENA to the CEFC.  This provision is no longer required once the CEFC is abolished.  [Schedule 1, Part 2, item 2]

1.16               Item 3 repeals paragraph 49(1)(sa) of the CER Act which allows particular protected information to be provided to the CEFC by the Clean Energy Regulator.  This provision is no longer required once the CEFC is abolished.  [Schedule 1, Part 2, item 3]

Transitional provisions

1.17               Schedule 1, Part 3 of this Bill contains transitional provisions which transfer the assets and liabilities, both investment and otherwise, to the Commonwealth.  It also relates to the transfer and management of associated matters which arise from the transfer of the assets and liabilities and the abolition of the CEFC. 

1.18               The transitional provisions allow for the orderly transfer of the CEFC’s assets and liabilities to the Commonwealth, which the Department will manage.  Unless otherwise specified, all references in this document to the Department are references to the Treasury. 

Introduction

1.19               Division 1, Item 4 defines several terms used throughout this Part that are relevant to the interpretation of its provisions.  [Schedule 1, Part 3, Division 1, item 4]

1.20               In particular, assets and liabilities are defined broadly to ensure that all assets and liabilities, actual, contingent or prospective of the CEFC are covered. 

1.21               The Corporation’s investments are defined as the assets and liabilities acquired or incurred for the CEFC’s investment function. 

Transfer of assets and liabilities

1.22               Division 2 provides for the transfer of the assets and liabilities of the CEFC to the Commonwealth by statutory novation.

1.23               Item 5 provides that when the CEFC is abolished, any of its assets cease to be assets of the CEFC and become assets of the Commonwealth and there is no need for any conveyance, transfer or assignment.  [Schedule 1, Part 3, Division 2, item 5]    

1.24               Item 6 provides that when the CEFC is abolished, any of its liabilities cease to be liabilities of the CEFC and become liabilities of the Commonwealth and there is no need for any conveyance, transfer or assignment.  [Schedule 1, Part 3, Division 2, item 6]

1.25               Item 7 provides a process for registration of the vesting of land, for use in the event that any land (including any interest in land) transfers to the Commonwealth under this Division.  [Schedule 1, Part 3, Division 2, item 7]

1.26               Item 8 provides a process for registration of the vesting of an asset other than land, in the event that any such asset (the vesting of which is suitable for registration) transfers to the Commonwealth under this Division.  [Schedule 1, Part 3, Division 2, item 8]

1.27               Under both items 7 and 8, sub-item (3) is included to assist readers.  It simply highlights that a certificate made under sub-item (1) does not fall under the definition of ‘legislative instrument’ under section 5 of the Legislative Instruments Act 2003 .  It is in no way purporting to exempt the item from the Legislative Instruments Act 2003 .  [Schedule 1, Part 3, Division 2, items 7 and 8]

1.28               Item 9 applies to assets and liabilities relating to the CEFC’s investment function.  [Schedule 1, Part 3, Division 2, item 9]

1.29               In assuming the assets and liabilities of the CEFC, the Commonwealth will establish appropriate arrangements so that the requisite resources and governance to effectively and efficiently manage those investments are in place.

1.30               Sub-item 9(1) gives the Commonwealth the power to hold, manage, meet obligations and realise or otherwise dispose of the transferred asset or liability.  This is designed to be broad to ensure that the Commonwealth has the ability to perform a wide range of functions in relation to the investment assets and liabilities.  [Schedule 1, Part 3, Division 2, item 9]

1.31               Sub-item 9(2) exempts the investment asset or liability from the application of sections 39 and 40 of the Financial Management and Accountability Act 1997 (FMA Act) which relate to the investment of public monies and the custody of securities.  This is intentionally broad to ensure that the Commonwealth can hold, manage and dispose of the assets (and discharge the liabilities) as required, and is not restricted by these provisions in the FMA Act.  [Schedule 1, Part 3, Division 2, item 9]

Transfer of other matters

1.32               Division 3 provides for the transfer of other matters.

1.33               Item 10 provides that once the CEFC is abolished, anything done by or in relation to the CEFC has effect as if it had been done by, or in relation to, the Commonwealth.  [Schedule 1, Part 3, Division 3, item 10]

1.34               Item 11 provides that once the CEFC is abolished the Commonwealth is substituted for the CEFC as a party to any proceedings that were pending in court to which the CEFC was a party.  This provision is designed to ensure that any existing litigation is not affected.  [Schedule 1, Part 3, Division 3, item 11]

1.35               Item 12 provides that any records or documents that were in the CEFC’s possession are transferred to the Department once the CEFC is abolished.  [Schedule 1, Part 3, Division 3, item 12]

1.36               Item 13 protects information disclosed to the CEFC by the Clean Energy Regulator under section 49 of the Clean Energy Regulator Act 2011 (CER Act).  If protected information was subject to conditions under subsection 49(3) of the CER Act, then those conditions continue to apply after commencement of this Act.  More broadly, any confidential information disclosed in relation to the assets or liabilities of the CEFC remain commercial-in-confidence, with the Commonwealth under the same duty to keep commercial-in-confidence information confidential as applied to the CEFC.  [Schedule 1, Part 3, Division 3, item 13]

1.37               Item 14 provides that if before the CEFC is abolished, a complaint was made to the Ombudsman or an investigation was begun by the Ombudsman in relation to action taken by the CEFC, then the Ombudsman Act 1976 applies after the CEFC is abolished as if that action had been taken by the Department.  [Schedule 1, Part 3, Division 3, item 14]

1.38               Item 15 provides that the CEFC is replaced by the Commonwealth for certain instruments.  In particular under sub-item 15(1), certain instruments means that the instrument must be in force before the CEFC is abolished and a reference made in the instrument to the CEFC.  [Schedule 1, Part 3, Division 3, item 15]

1.39               The instrument must also be one or more of the following: an instrument that was made by the CEFC; an instrument to which the CEFC was a party; an instrument that was given to or in favour of the CEFC; an instrument under which any right or liabilities accrue or may accrue to the CEFC; or any other instrument in which a reference is made to the CEFC.  [Schedule 1, Part 3, Division 3, item 15]

1.40               For example, the Commonwealth is substituted on all existing lease contracts for building accommodation replacing the CEFC. 

1.41               Sub-item 15(2) provides that an instrument includes a contract, undertaking, deed, agreement, notice, authority, order, instruction and instrument made under an Act or under regulations but does not include exempt instruments.  [Schedule 1, Part 3, Division 3, item 15]

1.42               Sub-item 15(3) defines exempt instruments to be an Act, an instrument made under this Act or an instrument specified in an instrument under sub-item 15(4).  [Schedule 1, Part 3, Division 3, item 15]

1.43               Sub-items 15(3)(c) and 15(4) allow the Minister to specify, by legislative instrument, that an instrument is an exempt instrument.  This provides the responsible Minister with the ability to exempt certain documents from the substitution of CEFC for Commonwealth where necessary.  [Schedule 1, Part 3, Division 3, item 15]

Special Account

1.44               Division 4 provides for the creation of a Special Account to assist in the transfer of the CEFC’s assets and liabilities.  The CEFC Transitional Special Account is designed to only be used for certain purposes to facilitate the orderly transfer of assets and liabilities from the CEFC to the Commonwealth.  It is also designed to cease once it is no longer required. 

1.45               Future monies that were due to be appropriated to the CEFC annually until 2017 will lapse.  The Bill also provides for excess funding to be returned to consolidated revenue at any stage if it is no longer needed for managing the CEFC’s assets and liabilities.

CEFC Transitional Special Account

1.46               Sub-item 16(1) establishes the CEFC Transitional Special Account.  The CEFC Transitional Special Account is a temporary measure in place to allow for the orderly transfer of assets and liabilities from the CEFC to the Commonwealth.  This ensures that sufficient funds are available to meet any costs incurred upon the transfer of the assets and liabilities from the CEFC.  [Schedule 1, Part 3, Division 4, item 16]

1.47               Under sub-item 16(2) the CEFC Transitional Special Account is a Special Account for the purposes of the FMA Act.  A Special Account is a ledger which records a right to draw money from the Consolidated Revenue Fund.  [Schedule 1, Part 3, Division 4, item 16]

Credits to the CEFC Transitional Special Account

1.48               Item 17 provides that certain amounts are credited to the CEFC Transitional Special Account.  [Schedule 1, Part 3, Division 4, item 17]

1.49               Under sub-item 17(1)(a) the net balance of the CEFC’s Special Account (the old Special Account) immediately before commencement must be transferred to the CEFC Transitional Special Account.  [Schedule 1, Part 3, Division 4, item 17]

1.50               Under sub-item 17(1)(b) the net balance of the CEFC’s bank account or bank accounts immediately before commencement must be transferred to the CEFC Transitional Special Account.  [Schedule 1, Part 3, Division 4, item 17]

1.51               Under sub-item 17(1)(c) the value of any securities in which the CEFC has invested surplus money under s18 of the Commonwealth Authorities and Companies Act 1997 (CAC Act) immediately before commencement must be transferred to the CEFC Transitional Special Account.  [Schedule 1, Part 3, Division 4, item 17]

1.52               Sub-item 17(2) defines the term old Special Account as the CEFC Special Account established by section 45 of the CEFC Act (as in force immediately before commencement).  [Schedule 1, Part 3, Division 4, item 17]

Purposes of the CEFC Transitional Special Account

1.53               Item 18 describes the purposes of the CEFC Transitional Special Account.  [Schedule 1, Part 3, Division 4, item 18]

1.54               Under sub-item 18(a) the CEFC Transitional Special Account can be used for paying or discharging the costs, expenses and other obligations incurred by the Commonwealth which are necessary or appropriate for the purposes of holding, managing, meeting obligations and realising or otherwise disposing of the assets and liabilities that vest in the Commonwealth under Division 2.  [Schedule 1, Part 3, Division 4, item 18]

1.55               Under sub-item 18(b) the CEFC Transitional Special Account can be used for paying any remuneration and allowances payable to any person in relation to holding, managing, meeting obligations and realising or otherwise disposing of the assets and liabilities that vest in the Commonwealth under Division 2.  [Schedule 1, Part 3, Division 4, item 18]

1.56               Under sub-item 18(c) the CEFC Transitional Special Account can be used for paying any other expenses necessary or appropriate for the purposes of meeting any other obligations incurred by the Commonwealth as a consequence of this Act.  [Schedule 1, Part 3, Division 4, item 18]

1.57               Under sub-item 18(d) the CEFC Transitional Account can be used for meeting the expenses of administering the CEFC Transitional Special Account.  [Schedule 1, Part 3, Division 4, item 18]

1.58               Under sub-item 18(e) the CEFC Transitional Special Account can be used for giving effect to a direction under item 19 which allow for transfers to the consolidated revenue fund.  [Schedule 1, Part 3, Division 4, item 18]

1.59               Note 1 to item 18 is designed to assist the reader by referring them to section 21 of the FMA Act which relates to debits from Special Accounts.  [Schedule 1, Part 3, Division 4, Note 1 in item 18]

1.60               Note 2 to item 18 is designed to assist the reader by referring them to items 7 and 28 of this Bill which relate to the effect of the reduction of the CEFC Transitional Special Account to nil.  [Schedule 1, Part 3, Division 4, Note 2 in item 18]

Transfer to the consolidated revenue fund

1.61               Item 19 provides a mechanism for the amounts in the CEFC Transitional Special Account to revert to the Consolidated Revenue Fund.  This provision is designed to ensure that the CEFC Transitional Special Account is only a transitional mechanism for the purposes of facilitating the shut-down of the CEFC.  [Schedule 1, Part 3, Division 4, item 19]

1.62               Sub-item 19(1) provides that the Finance Minister may, in writing, direct that a specified amount may be debited from the CEFC Transitional Special Account.  This ensures that unused amounts in the CEFC Transitional Special Account can be returned to the consolidated revenue fund.  [Schedule 1, Part 3, Division 4, item 19]

1.63               Sub-item 19(2) provides that if the Finance Minister is satisfied that no further amounts are required for the purposes outlined in item 19(1) of this Bill, that is, when the transfer of assets and liabilities of the CEFC to the Commonwealth has been effected, the Finance Minister must debit the remainder of the amount in the CEFC Transitional Special Account to nil.  [Schedule 1, Part 3, Division 4, item 19]

1.64               As referred to in the note to sub-item 19(2), if the amount debited from the CEFC Transitional Special Account reduces the balance to nil, then this Division, and the CEFC Transitional Special Account, are repealed the following day.  Under Clause 2 of the Bill, the Minister must announce the repeal day by notice in the Gazette (noting that this notice is not a legislative instrument).  [Schedule 1, Part 3, Division 4, Note in item 19]

1.65               Sub-item 19(3) is included to assist readers.  It simply highlights that a direction in writing made under sub-item (1) does not fall under the definition of ‘legislative instrument’ under section 5 of the Legislative Instruments Act 2003 .  It is in no way purporting to exempt the item from the Legislative Instruments Act 2003 .  [Schedule 1, Part 3, Division 4, item 19]

1.66               Sub-item 19(4) provides that the Finance Minister must give a copy of a direction under sub-item 16C(1) to the Minister.  [Schedule 1, Part 3, Division 4, item 19]

Annual reporting obligation

1.67               Division 5 contains provisions which outline the annual reporting obligations for the CEFC.  Under section 9 of the CAC Act, the CEFC is required to prepare an annual report.  This Division is designed to ensure that reporting obligations for the CEFC are maintained after the transfer to the Commonwealth. 

1.68               Under sub-item 20(1), the Secretary of the Department must prepare and give to the Minister a report on the operations of the CEFC during the final reporting period.  [Schedule 1, Part 3, Division 5, item 20]

1.69               The final reporting period is defined under sub-item 20(6).  This sub-item is designed to allow for flexibility for annual reporting dependent upon the commencement time of this Bill.  [Schedule 1, Part 3, Division 5, item 20]

1.70               Under sub-items 20(6)(a)(i) and 20(6)(b) if, at the commencement time, no annual report has been lodged by the CEFC, the final reporting period includes the financial year for which no annual report has been lodged and the new financial year.  [Schedule 1, Part 3, Division 5, item 20]

1.71               Otherwise, under sub-items 20(6)(a)(ii) and 20(6)(b) the final reporting period means the start of the financial year in which the commencement time occurs and ending immediately before the commencement time.  Under these provisions, the final reporting period could involve a period of less than one full financial year.  [Schedule 1, Part 3, Division 5, item 20]

1.72               Under sub-item 20(2), as far as practicable, the annual report must comply with the requirements for an annual report under section 9 of the CAC Act.  [Schedule 1, Part 3, Division 5, item 20]

1.73               In addition under sub-item 20(2) the annual report must include the extra matters required under section 74 of the CEFC Act.  Section 74 requires that the annual report must contain, in addition to the requirements under the CAC Act, the following:

•        The total value of the CEFC’s investments, broken down by class of clean energy technology;

•        The realisation of any investments;

•        If less than half of the funds invested for the purposes of the CEFC’s investment function are invested in renewable energy technologies, the CEFC must provide reasons why it has not met this requirement;

•        The total value of concessions given;

•        The assets and liabilities of the CEFC and a statement of cash flows;

•        The remuneration and allowances of Board members and senior staff;

•        Benchmark the CEFC’s expenses/operating costs against similar organisations;

•        Procurement contracts that have a value of more than $80,000; and

•        Credits and debits into the CEFC Special Account in the financial year.

[Schedule 1, Part 3, Division 5, item 20]

1.74               Sub-item 20(3) allows the Secretary of the Department to include the report in the Department’s annual report.  [Schedule 1, Part 3, Division 5, item 20]

1.75               Under sub-item 20(4), if the Secretary of the Department does not include the report in the Department’s annual report then the Secretary of the Department must give the report to the Minister within three months after the final reporting period.  The Minister must table the report in each House of the Parliament as soon as practicable and the Secretary of the Department must publish the report on the Department’s website as soon as practicable after tabling.  [Schedule 1, Part 3, Division 5, item 20]

1.76               Sub-item 20(5) provides that the Minister may grant an extension of time for the annual report in special circumstances.  [Schedule 1, Part 3, Division 5, item 20]

Investment reporting obligation

1.77               Division 6 contains provisions which outline the investment reporting obligations for the CEFC. 

1.78               Item 21 requires the CEFC to prepare a quarterly report for each quarter ending before the commencement time.  If commencement occurs part way through a quarter, the CEFC must also prepare a final quarterly report for the part quarterly period.  The quarterly reports must be published on the CEFC website.  [Schedule 1, Part 3, Division 6, item 21]

1.79               This item commences on the date of Royal Assent in order to allow the CEFC to prepare the final quarterly report prior to the repeal of the CEFC Act.  [Schedule 1, Part 3, Division 6, item 21, clause 2]

Officers and employees

1.80               Division 7 relates to the employees of the CEFC.  [Schedule 1, Part 3, Division 7]

1.81               Sub-item 22(1) provides that nothing in this Part results in the appointment, engagement or employment of a CEFC officer to the Commonwealth.  That is, under this Bill, the CEFC Board, employees and consultants do not transfer to the Commonwealth.  [Schedule 1, Part 3, Division 7, item 22]

1.82               Sub-item 22(2) defines a CEFC officer to be a member of the Board of the CEFC or an employee of the CEFC or a consultant engaged by the CEFC.  [Schedule 1, Part 3, Division 7, item 22]

Miscellaneous

1.83               Division 8 contains miscellaneous provisions. 

1.84               Item 23 is needed to ensure that State and Territory taxes such as stamp duty do not apply to the transfers of assets and liabilities.  [Schedule 1, Part 3, Division 8, item 23]

1.85               Sub-item 23(1) provides that no stamp duty or other tax is payable under the law of a State or Territory in respect of an exempt matter or anything connected with an exempt matter.  [Schedule 1, Part 3, Division 8, item 23]

1.86               The term ‘exempt matter’ is defined in sub-item 23(2) to mean the vesting of an asset or liability under this Part, or the operation of this Part in any other respect.  [Schedule 1, Part 3, Division 8, item 23]

1.87               Sub-item 23(3)(a) provides for the Minister to certify, in writing, that a specified matter is an exempt matter.  Under sub-item 23(3)(b) the Minister may also certify, in writing, that a matter is connected with an exempt matter.  [Schedule 1, Part 3, Division 8, item 23]

1.88               Sub-item 23(4) is included to ensure that the Minister’s certificate is evidence of the matters stated in the certificate.  [Schedule 1, Part 3, Division 8, item 23]

1.89               Item 24 provides that a document that appears to be a certificate made under this Part is taken to be such a certificate and is taken to have been properly given, unless the contrary is established.  [Schedule 1, Part 3, Division 8, item 24]

1.90               Item 25 provides that the Minister may, by writing, delegate all or any of his or her powers and functions under this Part to either the Secretary of the Department, a member of the Senior Executive Service (SES) of the Department, or an acting SES employee of the Department.  Sub-item 25(3) notes that in exercising powers or functions under a delegation, the delegate must comply with any directions of the Minister.  [Schedule 1, Part 3, Division 8, item 25]

1.91               Item 26 provides for compensation to be paid by the Commonwealth to a person from whom property is acquired on other than just terms.  If the Commonwealth and the person in question cannot agree on the amount of any such compensation to be paid, a court of competent jurisdiction may determine a reasonable amount of compensation for the acquisition of the property.  [Schedule 1, Part 3, Division 8, item 26]

Transitional function of the CEFC

1.92               Division 9 relates to the CEFC’s transitional function.  This Division modifies the CEFC’s functions during the transitional period from an investment role to one assisting with the wind-up process.

1.93               This transitional function takes precedence over the functions set out in the CEFC Act including not only the CEFC’s investment functions but any other provisions in the CEFC Act that might be contrary to assisting with the wind-up process.  However, while new investments will cease, the CEFC will continue to manage existing investments, meet existing obligations, and manage day-to-day CEFC operations during the transitional period.

1.94               The transitional function also includes the provision of information to a number of agencies, bodies or persons consistent with the provision of information under the CEFC Act but with the purpose of assisting with the wind-up process. 

1.95               Having the CEFC assisting the Commonwealth will be important to ensure increased continuity and knowledge transfer.  It will also help ensure that ongoing arrangements for managing the CEFC’s investments are developed with the current CEFC operating model in mind and therefore minimal disruption to the clean energy sector.

1.96               During the transitional period, the Minister may give written directions to the CEFC and the CEFC must comply with these directions.  This ensures that the CEFC can fulfil its transitional function of assisting with the wind-up process with full knowledge of the Commonwealth’s intentions for this process.  It may also assist with the process of passing on relevant knowledge and information required by the Commonwealth for the wind-up process and ongoing management of the CEFC’s investments.  [Schedule 1, Part 3, Division 9, item 27]

Instruments

1.97               Division 10 provides the Minister with the power, from Royal Assent, to make legislative instruments in relation to transitional matters.

1.98               This ensures that matters arising during the transitional process can be dealt with by the Minister without undue disruption to the CEFC’s investments and the clean energy sector.  

1.99               This is not designed to override or otherwise alter the effect of the Bill, but is merely to allow for additional transitional rules to assist in giving effect to this Bill.  [Schedule 1, Part 3, Division 10, item 28]

Repeal of the CEFC Transitional Special Account

1.100           Schedule 1, Part 4 relates to the repeal of the CEFC Transitional Special Account. 

1.101           Item 29 (in conjunction with clause 2) repeals Schedule1, Part 3, Division 4 of the Bill the day after the CEFC Transitional Special Account is reduced to nil.  [Schedule 1, Part 4, item 29]

1.102           Under clause 2 of the Bill, the Minister must announce the repeal day by notice in the Gazette . 

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Clean Energy Finance Corporation (Abolition) Bill 2014

1.103           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

1.104           This Bill repeals the Clean Energy Finance Corporation Act 2012 (CEFC Act) and transfers the assets, both investment and otherwise, to the Commonwealth. 

Human rights implications

1.105           This Bill does not engage any of the applicable rights or freedoms.

Conclusion

1.106           This Bill is compatible with human rights as it does not raise any human rights issues.

 

 

Schedule 1:  Amendments

Bill reference	Paragraph number
Clause 1	1.2
Clause 2	1.3, 1.79
Clause 3	1.10
Parts 1 and 2	1.4
Part 1, item 1	1.12
Part 2, item 2	1.15
Part 2, item 3	1.16
Part 3, Division 6	1.5
Part 3, Division 9	1.6
Part 3, Division 9	1.7, 1.8
Part 3, Division 1, item 4	1.19
Part 3, Division 2, item 5	1.23
Part 3, Division 2, item 6	1.24
Part 3, Division 2, item 7	1.25
Part 3, Division 2, items 7 and 8	1.27
Part 3, Division 2, item 8	1.26
Part 3, Division 2, item 9	1.28, 1.30, 1.31
Part 3, Division 3, item 10	1.33
Part 3, Division 3, item 11	1.34
Part 3, Division 3, item 12	1.35
Part 3, Division 3, item 13	1.36
Part 3, Division 3, item 14	1.37
Part 3, Division 3, item 15	1.38, 1.39, 1.41, 1.42, 1.43
Part 3, Division 4, item 16	1.46, 1.47
Part 3, Division 4, item 17	1.48, 1.49, 1.50, 1.51, 1.52
Part 3, Division 4, item 18	1.53, 1.55, 1.56, 1.57
Part 3, Division 4, item 18	1.54, 1.58
Part 3, Division 4, Note 1 in item 18	1.59
Part 3, Division 4, Note 2 in item 18	1.60
Part 3, Division 4, item 19	1.61, 1.62, 1.63, 1.65, 1.66
Part 3, Division 4, Note in item 19	1.64
Part 3, Division 5, item 20	1.68, 1.69, 1.70, 1.71, 1.72, 1.73, 1.74, 1.75, 1.76
Part 3, Division 6, item 21	1.78
Part 3, Division 6, item 21	1.79
Part 3, Division 7	1.80
Part 3, Division 7, item 22	1.81, 1.82
Part 3, Division 8, item 23	1.84, 1.85, 1.86, 1.87, 1.88
Part 3, Division 8, item 24	1.89
Part 3, Division 8, item 25	1.90
Part 3, Division 8, item 26	1.91
Part 3, Division 9, item 27	1.96
Part 3, Division 10, item 28	1.99
Part 4	1.9
Part 4, item 29	1.101

 

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