Commonwealth of Australia Explanatory Memoranda

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AUSTRALIAN TECHNICAL COLLEGES (FLEXIBILITY IN ACHIEVING AUSTRALIA'S SKILLS NEEDS) AMENDMENT BILL 2006

                               2004-2005-2006




    THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA




                     HOUSE OF REPRESENTATIVES




AUSTRALIAN TECHNICAL COLLEGES (FLEXIBILITY IN ACHIEVING
     AUSTRALIA'S SKILLS NEEDS) AMENDMENT BILL 2006




                    EXPLANATORY MEMORANDUM




(Circulated by authority of the Minister for Vocational and Technical Education
                     the Honourable Gary Hardgrave MP)
  AUSTRALIAN TECHNICAL COLLEGES (FLEXIBILITY IN
ACHIEVING AUSTRALIA'S SKILLS NEEDS) AMENDMENT BILL
                        2006

                                        OUTLINE

The purpose of the Bill is to amend the Australian Technical Colleges (Flexibility in
Achieving Australia's Skills Needs) Act 2005 (the Act), which provides for the
establishment and operation of Australian Technical Colleges. The Act provides funding
for the Colleges over the period 2005 to 2009.

The Bill will amend Column 2 of the table in subsection 18(4) of the Act. Funding from
2008 and 2009 will be brought forward into 2006 and 2007 to meet the expected
expenditure for the Australian Technical Colleges initiative over those years. The total
amount of funds appropriated under the Act will remain unchanged. The need for
increased funding in 2006 and 2007 reflects the significant progress that has been made
in establishing the Colleges.

The Bill also includes a regulation-making power to allow funding for a calendar year to
be carried over or brought forward to another calendar year. This amendment will
remove the need for an amendment to the Act when funding for a calendar year needs to
be carried over (or brought forward) during the funding period covered by the Act.

For example, with this power, the transfer of funds from 2008 and 2009 into 2006 and
2007 included as an amendment in this Bill (outlined above) would have been undertaken
by making regulations rather than an amendment to the Act.



                                 FINANCIAL IMPACT

The Bill provides for an appropriation of $343.6 million over the period 2005 to 2009 to
support the establishment and operation of the Colleges. This is consistent with the total
amount already appropriated under the Act.

The impact of the Bill on the fiscal balance is as follows:
      2005-06: - $31.027 million
      2006-07: - $44.008 million
      2007-08: + $10.227 million
      2008-09: + $44.009 million
      2009-10: + $20.779 million
  AUSTRALIAN TECHNICAL COLLEGES (FLEXIBILITY IN
ACHIEVING AUSTRALIA'S SKILLS NEEDS) AMENDMENT BILL
                        2006


                               NOTES ON CLAUSES

Part 1 - Preliminary

Clause 1 - Short Title

Provides for the Act to be cited as the Australian Technical Colleges (Flexibility in
Achieving Australia's Skills Needs) Amendment Act 2006.


Clause 2 - Commencement

Provides for the Act to commence on the day on which it receives the Royal Assent.


Clause 3 - Schedule(s)

Provides that each Act that is specified in a Schedule is amended or repealed as set out in
the applicable items in the Schedule, and that any other item in a Schedule has effect
according to its terms.
Schedule 1 -- Amendments
Australian Technical Colleges (Flexibility in Achieving Australia's Skills
Needs) Act 2005
Item 1 - Subsection 18(4) (cell at table item 2, column 2)

Section 18 of the Act provides that the Minister may make determinations authorising
payment of financial assistance under the Act to a State or to an Australian Technical
College authority. Subsection 18(4) includes a table setting out the maximum amounts of
financial assistance payable for each calendar year 2005-2009. Item 1 changes the
amount for the 2006 calendar year from `$47,950,000' to `$110,000,000'.


Item 2 - Subsection 18(4) (cell at table item 3, column 2)

Changes the amount for the 2007 calendar year from `$84,034,000' to `$110,000,000'.


Item 3 - Subsection 18(4) (cell at table item 4, column 2)

Changes the amount for the 2008 calendar year from `$101,419,000' to `$55,000,000'.


Item 4 - Subsection 18(4) (cell at table item 5, column 2)

Changes the amount for the 2009 calendar year from `$94,380,000' to `$52,783,000'.

The total appropriation under the Act is not altered by the amendments in items 1 to 4.
Funds are brought forward from 2008 and 2009 to 2006 and 2007 to allow those funds to
be spent earlier.


Item 5 - At the end of subsection 18(4)

Inserts a note at the end of subsection 18(4) which makes it clear that the operation of
section 20A may affect the amounts in column 2 of the table in subsection 18(4).


Item 6 - Before section 21

Inserts proposed new section 20A, which deals with changes to amounts under subsection
18(4). Proposed subsection 20A(1) provides that the regulations may specify an amount
for column 2 of the table in subsection 18(4) for a particular year. Proposed subsection
20A(2) provides that if regulations are made under subsection 20A(1) specifying an
amount for the column for the year, the Act has effect as if the amount specified in the
column for the year were the amount specified in the regulations for the column for the
year. Proposed subsection 20A(3) makes it clear that the amount the regulations may
specify under subsection 20A(1) may be nil.

This regulation making power is intended to provide for greater flexibility in the
administration of funds for Australian Technical Colleges under the Act. It is not
intended to be used to increase or decrease the total appropriation under the Act but to
allow amounts to be moved between calendar years should the need arise. This will
avoid the need to amend the Act each time funds need to be moved, and allow for greater
efficiency in the administration of the programme.