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2008-2009
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
TEXTILE, CLOTHING AND FOOTWEAR STRATEGIC INVESTMENT PROGRAM AMENDMENT
(BUILDING INNOVATIVE CAPABILITY) BILL 2009
EXPLANATORY MEMORANDUM
(Circulated by authority of Senator the Hon Kim Carr, Minister for
Innovation, Industry, Science and Research)
TEXTILE, CLOTHING AND FOOTWEAR STRATEGIC INVESTMENT PROGRAM AMENDMENT
(BUILDING INNOVATIVE CAPABILITY) BILL 2009
OUTLINE
The Textile, Clothing and Footwear Strategic Investment Program Amendment
(Building Innovative Capability) Bill 2009 amends the Textile, Clothing and
Footwear Strategic Investment Program Scheme Act 1999 ("the Act") to
provide authority for the formulation of the new Clothing and Household
Textile (Building Innovative Capability) scheme which will replace the TCF
Post-2005 (SIP) Scheme for the 2010-2011 to 2014-2015 program years.
The object of the new scheme is to foster the development of a sustainable
and internationally competitive manufacturing industry and design industry
for clothing and household textiles in Australia by providing incentives
which will promote innovation.
The new scheme is part of the Government's textile, clothing and footwear
innovation package which demonstrates the Government's commitment to
securing the long-term viability of the textile, clothing and footwear
industries in Australia.
Funding for the TCF Post-2005 (SIP) Scheme will no longer be available
after the 2010-2011 financial year as funding for the new scheme takes over
for the following five years.
The Bill inserts a new Part into the Act that largely replicates the Part
under which the TCF Post-2005 (SIP) Scheme is formulated, with some minor
drafting changes that do not change the effect of the law. The new Part
3C, which empowers the making of the Clothing and Household Textile (BIC)
scheme, comprises:
. provisions about caps to put limits on the amount payable under BIC;
. a standing appropriation;
. the policy objectives towards which the scheme is directed to achieving;
. the availability of only one type of grant (innovation grants);
. search and seizure powers to monitor compliance; and
. a list of additional matters that the new scheme can cover, including the
transition from the TCF Post-2005 (SIP) Scheme to the new scheme.
Part 2 (which deals with the original TCF (SIP) Scheme) and Part 3 (which
deals with supplementation of the defunct Regional Assistance Program) of
the Act are repealed as they are spent provisions.
A number of consequential amendments to the Act are required as a result of
these amendments (including amendments of the short and long titles of the
Act).
The opportunity is being taken to update the language of the Act in the
light of the Legislative Instruments Act 2003 and to provide greater
flexibility in the ways in which the Commonwealth may recover scheme debts
(through debt set-off against advances in addition to set-off against
grants).
Section 37X of the Act is amended to make it clear that particular types of
decisions of the Secretary may be excluded from merits review. These
decisions relate to the application of caps, expenditure thresholds and the
modulation factor for grants and advances on account of grants. The new
Part 3C replicates the amended section 37X for the purposes of the new
scheme.
A reading down provision is inserted to ensure that the Act validly
applies, and is taken to have always validly applied, to payments to
entities for which there is a connection with relevant Commonwealth heads
of legislative power. Whilst the Act relies on the executive power, it
takes additional power from the listed powers.
A transitional provision relating to section 37X of the Act and a savings
provision relating to the repeal of Parts 2 and 3 of the Act are also
provided.
FINANCIAL IMPACT STATEMENT
Innovation grants will be funded from a standing appropriation. The total
of the grants paid under the Clothing and Household Textile (BIC) scheme
for the five program years 2010-2011 to 2014-2015 must not exceed $112.5
million.
TEXTILE, CLOTHING AND FOOTWEAR STRATEGIC INVESTMENT PROGRAM AMENDMENT
(BUILDING INNOVATIVE CAPABILITY) BILL 2009
NOTES ON CLAUSES
Clause 1: Short title
1. This clause provides for the Bill, once enacted, to be cited as the
Textile, Clothing and Footwear Strategic Investment Program Amendment
(Building Innovative Capability) Act 2009.
Clause 2: Commencement
2. This clause provides for the Bill to commence on the day that it
receives the Royal Assent.
Clause 3: Schedule(s)
3. Clause provides for the Act specified in Schedule 1 to be amended as
set out in the applicable items to the Schedule and that any other item in
the Schedule has effect according to its terms.
Schedule 1-Textile, Clothing and Footwear Strategic Investment Program Act
1999
Item 1: Title
4. This item has the effect of changing the long title to "An Act about
the Textile, Clothing and Footwear Investment and Innovation Programs, and
for other purposes".
Item 2: Section 1
5. This item changes the short title to the Textile, Clothing and
Footwear Investment and Innovations Programs Act 1999 to better reflect the
programs provided under the Act.
Item 3: Section 3
6. This item substitutes a new simplified outline consequential on the
amendments made by the Bill.
Items 4-9: Section 4
7. These items provide for definitions of authorised Commonwealth
contractor, business day, Clothing and Household Textile (BIC) scheme and
clothing/finished textile expenditure and repeal the redundant definitions
of bounty and loan.
Item 10: Section 4 (definition of scheme debt)
8. This item repeals the definition of scheme debt and substitutes a new
definition to include the new Clothing and Household Textile (BIC) scheme
and to omit reference to loans as loans are only capable of being given
under Part 2 which is repealed by item 13.
Item 11: Section 4
9. This item inserts the definition of TCF Scheme in section 4. Under
the definition a TCF scheme means the TCF Post-2005 (SIP) scheme or the
Clothing and Household Textile (BIC) scheme.
Item 12: Section 4 (definition of TCF (SIP) scheme)
10. This item substitutes a new definition of TCF (SIP) Scheme
consequential on the repeal of Part 2 of the Act (see item 13).
Item 13: Parts 2 and 3
11. This item repeals the parts of the Act that provide for the TCF (SIP)
Scheme (Part 2) and supplementation of the Regional Assistance Program
(Part 3). Grants are no longer payable under the TCF (SIP) Scheme and the
Regional Assistance Program has ceased.
Items 14 and 15: Subsection 37A(2)
12. These items amend the simplified outline of the TCF Post-2005 (SIP)
scheme consequential on the amendments effected by items 18, 22, 24 and 26.
Item 16: Section 37B (definition of clothing/finished textile expenditure)
13. This item repeals the definition of clothing/finished textile
expenditure as the definition is now dealt with in Section 4 (see item 8).
Item 17: Subsection 37D(1)
14. This item effects a technical amendment consequential on the
amendment effected by item 19.
Item 18: Subsection 37D(1)
15. The item reduces the total cap on the amount of grants available
under the TCF Post-2005 (SIP) scheme from $575,000,000 to $487,500,000.
Item 19: Subsections 37D(2) and (3)
16. This item repeals subsections 37D(2) and (3) consequential on the
amendment effected by items 18, 22, 24 and 26.
Items 20-27: Paragraphs 37G(2)(b) and (c), Subsection 37G(2) (note),
Paragraphs 37G(4)(b) and (c), Subsection 37G(4) (note), Paragraph
37G(5)(b), Subsection 37G(5) (note), Paragraphs 37H(1)(b) and (c), and
Subsection 37H(1) (note)
17. These items limit the income years in which grants are to be made
under the TCF Post-2005 (SIP) scheme to the 2005-2006 to 2009-2010 income
years and repeal the notes referring to clothing/finished textile
expenditure as this is now defined in section 4 (see item 8).
Item 28: Subsection 37P(8)
18. This item repeals the subsection consequential on the amendments
effected by items 4 and 6.
Item 29: After subsection 37X(2)
19. This item inserts new subsection 37X(2A) to provide that the TCF Post-
2005 (SIP) scheme may contain provisions that specify decisions in relation
to which the provisions mentioned in subsection 37ZZF(2) do not apply.
20. These decisions are those that arise from the application, in
relation to the entitlement to be paid a grant or to the amount of a grant,
and to the eligibility for an advance of a grant or to the amount of an
advance, of:
. the prescribed caps on the maximum payment rates for grants and advances
on account of grants;
. the prescribed sales-based caps for grants (which are based on a
percentage of revenue or investment amounts);
. the prescribed expenditure thresholds (which must be exceeded before
grants and advances on account of grants can be paid); and
. the modulation factor (which ensures that the total of grants (including
advances on account of grants) does not exceed the expenditure limit on
the scheme).
21. Subjecting decisions of the Secretary that arise from the application
of these caps, expenditure thresholds or modulation factor to merits review
risks frustrating the operation of the scheme. For example, the amounts of
grants payable in a financial year are determined late in the year once all
claims for grants have been made. If the total of the claims exceeds the
annual limit on payments, each entity's grant amount is adjusted by the
modulation factor to ensure that the total payment limit is not exceeded.
The modulation factor is worked out in accordance with a prescribed formula
and must be applied to each entity's grant eligibility amount. Review of
the Secretary's decision on one entity's modulated grant amount arising out
of the application of the modulation factor would affect the payment of
grants to all other entities (which is required in early June) as all
payments would have to be delayed until the review process is completed in
order to ration the available funds equitably. For equity reasons, the
same modulation factor in a particular program year is applied to each
entity's grant eligibility amount.
22. The TCF Post-2005 (SIP) Scheme is a beneficial, demand-driven scheme
in contrast with, for example, a licensing scheme where the livelihood of a
person depends on whether or not a licence is obtained. Details of the
Scheme are prescribed in the legislative instrument which provides an
element of flexibility to adjust the operating parameters to respond to new
circumstances. This includes prescribing parameters such as the caps,
expenditure thresholds and modulation factor and adjusting them in response
to changes in demand. It is therefore appropriate that the decisions that
are exempt from merits review be prescribed in the legislative instrument.
Participants in the Scheme are used to looking only at the legislative
instrument and are cognisant of the lack of review for certain decisions on
grants and advances.
Item 30: Section 37ZG
23. This item amends section 37ZG, which provides for an instrument made
under section 37C to be a disallowable instrument, consequential on the
Legislative Instrument Act 2003.
Item 31: Section 37ZI
24. This item amends the requirement to publish the name of each entity
paid a grant and the amount of grants paid, consequential on the amendments
effected by items 22, 24 and 26.
Item 32: After Part 3B
25. This item inserts new Part 3C under which the Clothing and Household
Textile (BIC) scheme can be made. Part 3C largely replicates Part 3A
(under which the TCF Post-2005 (SIP) scheme is made) with some minor
drafting changes to the structure and language that are not intended to
change the effect of the law.
Part 3C-Clothing and Household Textile (BIC) scheme
Division 1-Preliminary
Section 37ZK Object of Part and simplified outline
New section 37ZK sets out the object of Part 3C and provides a
simplified outline.
Subsection 37ZK(1) provides that the object of the Part is to foster
the development of a sustainable and internationally competitive
manufacturing industry and design industry for clothing and household
textile in Australia by providing incentives which will promote
innovation.
Subsection 37ZK(2) provides a simplified outline of the Part which
provides that:
. the Minister must formulate a scheme (the Clothing and Household
Textile (BIC) scheme) for the making of grants in connection with
the design and manufacture, in Australia, of eligible clothing and
household textile products;
. the total of the grants paid under the Clothing and Household
Textile (BIC) scheme must not exceed $112.5 million;
. the Clothing and Household Textile (BIC) scheme will provide for
innovation grants in respect of clothing/finished textile
expenditure;
. the Clothing and Household Textile (BIC) scheme will provide for
the making of those grants in respect of expenditure incurred in
the 2010-2011 to 2014-2015 income years;
. grants under the Clothing and Household Textile (BIC) scheme are to
be made in arrears; and
. entities wishing to obtain grants under the Clothing and Household
Textile (BIC) scheme may be required to register under the scheme
and to submit strategic business plans and accounts.
Section 37ZL Definitions
New section 37ZL provides definitions in relation to Part 3C:
. authorised officer means a person appointed under subsection
37ZY(1) as an authorised officer of the Department; and
. innovation grant has the meaning given by section 37ZQ.
Division 2-Formulation of Clothing and Household Textile (BIC) scheme
Section 37ZM Clothing and Household Textile (BIC) scheme
New section 37ZM empowers the Minister to formulate, by legislative
instrument, the Clothing and Household Textile (BIC) scheme for the
making of grants in connection with, or incidental to, the following:
. the manufacture in Australia of products that, under the scheme,
are taken to be eligible clothing and household textile products;
. the design in Australia, for manufacture in Australia, of products:
- that, under the scheme, are taken to be eligible clothing and
household textile products; and
- some or all of which are intended to be sold in Australia;
. the design in Australia, for manufacture outside Australia, of
products to which both of the following apply, if the importation
into Australia of some or all of the products is or will be covered
by a designated industry program:
- products that, under the scheme, are taken to be eligible
clothing and household textile products;
- products, some or all of which are intended to be sold in
Australia.
The note to section 37ZM makes it clear that the title Clothing and
Household Textile (BIC) scheme is short for Clothing and Household
Textile (Building Innovative Capability) scheme (see item 7).
Section 37ZN Caps
New section 37ZN provides that the scheme must make provision for
ensuring that the total of innovation grants (including advances on
account of innovation grants) paid under the scheme does not exceed
$112,500,000.
The note to section 37ZN draws attention to section 37ZZE, which
provides for funding to be provided to entities by way of advances on
account of innovation grants.
Section 37ZO Appropriation
New section 37ZO provides that innovation grants (including advances on
account of innovation grants) are to be paid out of the Consolidated
Revenue Fund, which is appropriated accordingly.
A standing appropriation is warranted for the Clothing and Household
Textile (BIC) scheme in order to provide participating entities with a
degree of certainty that innovation grants will be funded in future
years of the scheme. This is important because participating entities
incur clothing/finished textile expenditure in one year and then wait
until the following year before being able to claim innovation grants
to which they are entitled to be paid.
Parliamentary control over expenditure for the purposes of the Clothing
and Household Textile (BIC) scheme is effected by new section 37ZN and
new paragraph 37ZR(2)(b), which operate to restrict the standing
appropriation in both amount and duration.
Division 3-General policy objectives
Section 37ZP General policy objectives
New section 37ZP provides that the general policy objectives of the
Clothing and Household Textile (BIC) scheme must be directed towards
ensuring the achievement of the policy objectives set out in Division
3.
Section 37ZQ Type of grants
New section 37ZQ describes the types of grants available under the
Clothing and Household Textile (BIC) scheme, namely: that there are to
be innovation grants in respect of clothing/finished textile
expenditure. The note refers to section 4 where clothing/finished
textile expenditure is defined (see item 8).
Section 37ZR Provisions relating to innovation grants in respect of
clothing/finished textile expenditure
New section 37ZR sets out the policy objective that prescribes the
nature of the eligible expenditure and the income years in which it can
be incurred for the purpose of the Clothing and Household Textile (BIC)
scheme. Specifically, it provides for innovation grants only in
respect of expenditure that, under the scheme, is taken to be
clothing/finished textile expenditure, and that such expenditure is
incurred by an entity during any of the 2010-2011 to 2014-2015 income
years of the entity.
The note to section 37ZR refers to section 4 where clothing/finished
textile expenditure is defined (see item 8).
Section 37ZS Grants to be made in arrears
New section 37ZS sets out the policy objective to the effect that
innovation grants must be paid in arrears. It does this by providing
that an innovation grant must not be made to an entity in respect of
expenditure incurred by the entity during an income year of the entity
unless the entity makes a claim for the innovation grant after the end
of the income year.
Section 37ZT Grants cap based on eligible revenue and eligible start-
up investment amount
New section 37ZT sets out the grant caps that place a ceiling on grant
amounts paid in relation to an income year based on an entity's
eligible revenue for the relevant income year or, in the case of an
entity start-up, the eligible start-up investment amount of the entity.
Subsections 37ZT(1) and (2) provide that it is a policy objective for
the Clothing and Household Textile (BIC) scheme that there be a cap on
the total of the innovation grants that become payable to an entity
during an income year (the claim year) of the entity in respect of
expenditure incurred by the entity otherwise than during a period that,
under the scheme, is taken to be an eligible start-up period of the
entity. The total of the innovation grants must not exceed five per
cent of the amount that, under the scheme, is taken to be the total
eligible revenue derived by the entity, during the income year of the
entity before the claim year, from sales of products that, under the
scheme are taken to be eligible clothing and household textile
products.
Subsections 37ZT(3) and (4) provide that it is also a policy objective
for the Clothing and Household Textile (BIC) scheme that there be a cap
on the total of the innovation grants that become payable to an entity
during an income year (the claim year) of the entity and any income
years of the entity that are earlier than the claim year in respect of
expenditure incurred by the entity during a period that, under the
scheme, is taken to be an eligible start-up period of the entity. The
total of the innovation grants must not exceed 15 per cent of the
amount that, under the scheme, is taken to be the total of the eligible
start-up investment amounts of the entity for each of the income years
of the entity that is earlier than the claim year.
Subsection 37ZT(5) provides that, for the purposes of section 37ZT, an
innovation grant becomes payable to an entity when a determination is
made under the scheme that the entity is entitled to be paid the
innovation grant.
Division 4-Registration for the purposes of the scheme
Section 37ZU Registration for the purposes of the scheme
New section 37ZU empowers the Minister to impose requirements in the
Clothing and Household Textile (BIC) scheme.
Subsection 37ZU(2) sets out requirements that may be included but makes
it clear that the requirements are not limited to these. The
requirements to be included may include that entities must register to
participate in the scheme, and requirements relating to the statements,
information and fees that must accompany applications for registration.
Subsection 37ZU(3) provides that the scheme may provide for one or more
of the following consequences for an entity that does not comply with a
particular requirement relating to registration: ineligibility for an
innovation grant, restriction or reduction of an innovation grant, and
deferral of payment of an innovation grant.
Division 5-Strategic business plans and accounts
Section 37ZV Strategic business plans
New section 37ZV provides, in effect, that the Clothing and Household
Textile (BIC) scheme must provide that an entity is not eligible for an
innovation grant if it fails to comply with requirements (if any)
imposed by the scheme in relation to the content and submission of
strategic business plans and variations of strategic business plans.
Section 37ZW Accounts
New section 37ZW provides that the Clothing and Household Textile (BIC)
scheme may provide that an entity is ineligible for an innovation grant
if it does not comply with requirements relating to the submission of
audited accounts and audited financial statements or the submission of
unaudited accounts and unaudited financial statements.
Division 6-Conditional grants
Section 37ZX Conditional grants
New section 37ZX provides that payment of innovation grants is subject
to conditions that relate to the administration of the scheme,
including compliance with notices, provision of false and misleading
information and entry to premises.
Subsection 37ZX(1) provides that the Clothing and Household Textile
(BIC) scheme may make provision for and in relation to the payment of
innovation grants subject to conditions (whether conditions precedent
or conditions subsequent).
Subsections 37ZX(2) and (3) impose conditions that relate to compliance
with any notice given to the entity under section 38, provision of
false or misleading statement in relation to a claim for the grant,
false or misleading information or evidence given, or a false or
misleading document produced in relation to compliance with section 38.
Subsection 37ZX(4) provides a condition that an innovation grant paid
to an entity is subject to the condition that in relation to the
premises covered by subsection 37ZX(5), the entity;
. allow access to premises by authorised officers, and any authorised
employees of an authorised Commonwealth contractor accompanying
those officers, at any reasonable time of a business day for the
purpose of monitoring compliance with other conditions to which the
innovation grant is subject;
. allow authorised officers during that access to inspect and search
the premises and any thing on the premises for the purpose of that
monitoring;
. allow authorised officers to operate electronic equipment at the
premises to see whether documents in electronic form relevant to
that monitoring are accessible by doing so;
. allow authorised officers to make copies of any documents in hard
copy form found on the premises that are relevant to that
monitoring; and
. provide authorised officers with all reasonable facilities and
assistance in connection with that monitoring.
Subsection 37ZX(5) provides that the subsection covers business
premises specified in the notice that is given to the entity notifying
the entity that the entity is entitled to be paid the innovation grant
or business premises specified in a later notice given to the entity by
the Secretary under subsection 37ZX(6).
Subsection 37ZX(6) provides that the Secretary may, by written notice
given to an entity, specify business premises for the purposes of
paragraph 37ZX(5)(b).
Section 37ZY Appointment of authorised officers and authorised
employees of Commonwealth contractors
New section 37ZY empowers the Secretary to appoint authorised officers
and authorised employees of Commonwealth contractors.
Subsection 37ZY(1) provides that the Secretary may, by writing, appoint
an APS employee in the Department to be an authorised officer of the
Department for the purposes of this Part. The Secretary may do so only
if the Secretary is satisfied that the employee has suitable
qualifications for such an appointment.
Subsection 37ZY(2) provides that the Secretary may, by writing, appoint
an employee of an authorised Commonwealth contractor to be an
authorised employee of the contractor for the purposes of this Part.
The Secretary may do so only if the Secretary is satisfied that the
employee has suitable qualifications for such an appointment.
Division 7-Monitoring of compliance
Section 37ZZ Operation of electronic equipment by authorised officers
New section 37ZZ provides for the situation where an authorised officer
has gained access to premises and needs to access information by
operating electronic equipment.
Subsection 37ZZ(1) sets out the conditions that an authorised officer
having obtained access to premises for the purpose of monitoring
compliance with the conditions of an innovation grant finds that
documents in electronic form, relevant to that monitoring, are
accessible by operating electronic equipment at the premises.
Subsection 37ZZ(2) provides that the authorised officer may do only one
of two things, as set out in subsection 37ZZ(3) or (4), namely: operate
the equipment or other facilities at the premises to put the documents
in hard copy form or transfer the documents to a storage device
(including a disk or tape) if the storage device is brought to the
premises for the exercise of the power, or the storage device is at the
premises, and its use has been agreed to in writing by the occupier of
the premises.
Subsection 37ZZ(5) provides that the authorised officer may then remove
the documents in hard copy form or remove the storage device.
Section 37ZZA Operation of electronic equipment by experts
New section 37ZZA provides for the situation where an authorised
officer has gained access to premises and needs to access information
by operating electronic equipment and requires expert assistance to
access the information.
Subsection 37ZZA(1) sets out the conditions where an authorised officer
has obtained access to premises for the purpose of monitoring
compliance with the conditions of an innovation grant and the officer
believes on reasonable grounds that:
. documents in electronic form, relevant to that monitoring, may be
accessible by operating electronic equipment at the premises; and
. expert assistance is required to operate the equipment; and
. an authorised employee (the expert) of an authorised Commonwealth
contractor accompanying the officer in relation to that monitoring
has the expertise to operate the equipment.
Then, under subsection 37ZZA(2), the expert may operate the equipment
to determine whether such documents are accessible. If they are, the
expert may do only one of two things, as set out in subsection 37ZZA(3)
or (4), namely: operate the equipment or other facilities at the
premises to put the documents in hard copy form or transfer the
documents to a storage device (including a disk or tape) if the storage
device is brought to the premises for the exercise of the power, or the
storage device is at the premises, and its use has been agreed to in
writing by the occupier of the premises.
Subsection 37ZZA(5) provides that the authorised officer may then
remove the documents in hard copy form or remove the storage device.
Subsection 37ZZA(6) provides that for the purposes of the application
of the definition of Commonwealth officer in subsection 3(1) of the
Crimes Act 1914 to section 70 of that Act, an authorised employee of an
authorised Commonwealth contractor who exercises a power referred to in
this section is taken to be a person who performs services for the
Commonwealth.
Section 37ZZB Pre-condition to operating electronic equipment
New Section 37ZZB provides that a person may operate electronic
equipment at premises as mentioned in Division 7 only if he or she
believes on reasonable grounds that the operation of the equipment can
be carried out without damage to the equipment.
Section 37ZZC Compensation for damage to electronic equipment
New Section 37ZZC provides for compensation to be paid to an entity by
the Commonwealth if electronic equipment is operated without sufficient
care by an authorised officer or authorised employee and is damaged, or
data or schemes related to that equipment are damaged.
Subsection 37ZZC(1) applies if, as a result of equipment being operated
as mentioned in section 37ZX, 37ZZ or 37ZZA, damage is caused to the
equipment, the data recorded on the equipment is damaged, or schemes
associated with the use of the equipment, or with the use of the data,
are damaged or corrupted and the damage or corruption occurs because
insufficient care was exercised in selecting the person who was to
operate the equipment, or insufficient care was exercised by the person
operating the equipment.
Subsection 37ZZC(2) provides that the Commonwealth must pay the owner
of the equipment, or the user of the data or schemes, such reasonable
compensation for the damage or corruption as the Commonwealth and the
owner or user agree on.
Subsection 37ZZC(3) provides that, if the owner or user and the
Commonwealth fail to agree, the owner or user may institute proceedings
in the Federal Court of Australia for such reasonable amount of
compensation as the Court determines.
Subsection 37ZZC(4) provides that, in determining the amount of
compensation payable, regard is to be had to whether the occupier of
the premises, or the occupier's employees or agents, if they were
available at the time, provided any appropriate warning or guidance on
the operation of the equipment.
Subsection 37ZZC(5) provides for compensation to be payable out of
money appropriated by the Parliament.
Subsection 37ZZC(6) provides that, for the purposes of
subsection 37ZZC(1), damage, in relation to data, includes damage by
erasure of data or addition of other data.
Section 37ZZD Identity cards
New section 37ZZD provides, under subsection 37ZZD(1), that the
Secretary must issue an identity card to an authorised officer.
Subsection 37ZZD(2) provides that the identity card must be in the form
prescribed by the regulations and contain a recent photograph of the
authorised officer.
Subsection 37ZZD(3) provides that a person commits an offence if the
person has been issued with an identity card, the person ceases to be
an authorised officer, and the person does not return the identity card
to the Secretary as soon as practicable. The penalty provision is 1
penalty unit.
Subsection 37ZZD(4) provides that an offence against
subsection 37ZZD(3) is an offence of strict liability. Strict
liability is appropriate because subsection 37ZZD(3) involves an
offence that would be difficult to prosecute as a fault provision,
particularly involving intent.
The offence of subsection 37ZDD(3) would depend on the action or lack
of action of a person who was formerly an authorised officer and who
would be actually liable for the offence. Making the offence one of
strict liability affords a greater degree of protection to entities
subject to the actions of an authorised officer by only having to rely
on the transgressing action to establish a prosecution. This
protection also gives greater confidence that the exercise of the power
would be publicly acceptable.
As a former authorised officer (see subsection 37ZDD(1)) the person
concerned would be expected to know the requirements and obligations
provided for by the Clothing and Household Textile (BIC) scheme,
including those of section 37ZZD. Further, the strict liability
offence is the same as that of subsection 37U(3) for the TCF Post-
2005(SIP) Scheme which has been in the public domain since its
introduction by the Textile, Clothing and Footwear Strategic Investment
Program Amendment (Post-2005 Scheme) Act 2004. The penalty of
1 penalty unit is a minimal amount.
Subsection 37ZZD(5) provides that subsection 37ZZD(3) does not apply if
the identity card was lost or destroyed, although it is noted that a
defendant bears an evidential burden in relation to the matter in this
subsection (see subsection 13.3(3) of the Criminal Code).
Subsection 37ZZD(6) provides that an authorised officer must carry his
or her identity card at all times when exercising powers as an
authorised officer.
Subsection 37ZZD (7) provides that an authorised officer is not
entitled to exercise any powers referred to in Division 7 in relation
to premises if the occupier of the premises has requested the officer
to produce the officer's identity card for inspection by the occupier,
and the officer fails to comply with the request.
Division 8-Other matters for which the scheme may provide
Section 37ZZE Advances on account of grants
Subsection (1) of new section 37ZZE provides that the Clothing and
Household Textile (BIC) scheme may provide for advances on account of
innovation grants that may become payable.
Subsection 37ZZE (2) provides that, if an entity receives an amount by
way of an advance on account of a grant that may become payable to the
entity; and that amount exceeds the amount of the grant, then the
entity is liable to pay to the Commonwealth the amount of the excess.
Subsection 37ZZE (3) provides that an entity is liable to pay to the
Commonwealth the whole amount of an advance mentioned in
paragraph 37ZZE(2)(a) if the entity does not receive the innovation
grant on account of which the advance was given. This provision is
included in the interest of certainty.
Section 37ZZF Reconsideration and review of decisions
New section 37ZZF requires that the Clothing and Household Textile
(BIC) scheme must have provisions for review of decisions.
Subsection 37ZZF(1) provides that the Clothing and Household Textile
(BIC) scheme must contain provisions for and in relation to the review
of decisions of the Secretary under the scheme that affect an entity.
Subsection 37ZZF(2) provides that the scheme must contain provisions
under which:
. an entity that is affected by an initial decision of the Secretary
under the scheme may, if dissatisfied with the decision, request
the Secretary to reconsider the decision; and
. the Secretary is required to reconsider the initial decision and to
confirm, revoke or vary the decision; and
. an application may be made to the Administrative Appeals Tribunal
for review of an initial decision that has been confirmed or
varied.
Subsection 37ZZF(3) provides that the scheme may contain provisions
that specify decisions in relation to which the provisions mentioned in
subsection 37ZZF(2) do not apply. The exempted decisions will be
equivalent to those exempted from merits review under the TCF Post-2005
(SIP) Scheme (see item 29).
Subsection 37ZZF(4) provides that, if the scheme provides that the
Secretary is taken to have confirmed an initial decision after a
specified period, the scheme must specify the prescribed time for
making an application for review of the initial decision as so
confirmed for the purposes of section 29 of the Administrative Appeals
Tribunal Act 1975.
Section 37ZZG Guarantees relating to payment of scheme debts
New section 37ZZG provides that the Clothing and Household Textile
(BIC) scheme may provide that an entity ascertained in accordance with
the scheme is not eligible for an innovation grant, or is not entitled
to request an advance on account of an innovation grant, unless another
entity ascertained in accordance with the scheme gives a guarantee to
the Commonwealth that any scheme debts owed by the eligible entity will
be paid.
Section 37ZZH Non-arm's length transactions
New section 37ZZH provides that the Clothing and Household Textile
(BIC) scheme may provide that, if an entity incurs expenditure under a
transaction that is not at arm's length, the amount of that expenditure
is taken to be the amount that would reasonably have been expected to
be incurred if the parties had been dealing with each other at arm's
length.
Section 37ZZI Grants and advances to be inalienable
New section 37ZZI provides that the Clothing and Household Textile
(BIC) scheme may provide for innovation grants (including advances on
account of innovation grants) to be absolutely inalienable (whether by
way of, or in consequence of, sale, assignment, charge, execution,
bankruptcy or otherwise) except with the approval of the Secretary.
Section 37ZZJ Other matters
New section 37ZZJ provides for other matters. These matters concern
administrative requirements of the Clothing and Household Textile (BIC)
scheme that relate to the making and assessment of claims for
innovation grants, apportionment of expenditure, transfer of business,
timing of grant payments and transitional arrangements arising out of
the transition from the TCF Post-2005 (SIP) Scheme.
The Clothing and Household Textile (BIC) scheme, rather than the Act,
is considered to be the most appropriate vehicle for setting out
transitional arrangements as the scheme is more highly visible to
participants because it details how the scheme works. Allowing for
these matters to be provided for in the legislative instrument also
provides flexibility to modify the scheme should new circumstances
arise.
Under subsection 37ZZJ(1), the Clothing and Household Textile (BIC)
scheme may provide for:
. the making of claims for innovation grants;
. the times within which claims for innovation grants are to be made;
. requiring that a claim for an innovation grant made by an entity
ascertained in accordance with the scheme be accompanied by an
audited statement relating to specified activities;
. requiring that a claim for an innovation grant made by an entity
ascertained in accordance with the scheme be accompanied by an
unaudited statement relating to specified activities;
. requiring that a claim for an innovation grant be accompanied by
such a fee as is ascertained in accordance with the scheme;
. the assessment of claims for innovation grants;
. the apportionment of expenditure;
. the adjustment of eligibility for innovation grants in relation to
the transfer of the whole or a part of a business, including (but
not limited to):
- treating the transferee as if the transferee had incurred
particular expenditure, had derived particular revenue and had
done particular acts or things; and
- treating the transferor as if the transferor had not incurred
particular expenditure, had not derived particular revenue and
had not done particular acts or things;
. the times when innovation grants become payable; and
. matters of a transitional nature (including any saving or
application provisions) arising out of the transition from the TCF
Post-2005 (SIP) scheme to the Clothing and Household Textile (BIC)
scheme.
It is appropriate for the Clothing and Household Textile (BIC) scheme
to able to prescribe matters of a transitional nature as the
legislative instrument sets out details of the scheme and, as a
consequence, has greater visibility to participants than does the Act.
It also provides flexibility to change the details of the scheme should
new circumstances arise.
Subsection 37ZZJ(2) provides that subsection 37ZZJ(1) does not, by
implication, limit section 37ZM (power to make Clothing and Household
Textile (BIC) scheme).
Subsection 37ZZJ(3) provides that the amount of a fee under the
Clothing and Household Textile (BIC) scheme must not be such as to
amount to taxation.
Section 37ZZK Scheme may confer administrative powers on the Secretary
New section 37ZZK provides that the Clothing and Household Textile
(BIC) scheme may confer administrative powers on the Secretary. This
is to facilitate the administration of the scheme.
Section 37ZZL Ancillary or incidental provisions
New section 37ZZL provides that the Clothing and Household Textile
(BIC) scheme may contain such ancillary or incidental provisions as the
Minister considers appropriate.
Section 37ZZM Variation of scheme
Subsection (1) of new section 37ZZM provides that the Clothing and
Household Textile (BIC) scheme may be varied, but not revoked, in
accordance with subsection 33(3) of the Acts Interpretation Act 1901.
Subsection 37ZZM(2) provides that subsection 37ZZM(1) does not limit
the application of subsection 33(3) of the Acts Interpretation Act 1901
to other instruments under the Textile, Clothing and Footwear
Investment and Innovation Programs Act.
Division 9-Publication of grant totals
Section 37ZZN Publication of grant totals
New section 37ZZN provides that, as soon as practicable after the end
of each of the 2011-2012 to 2015-2016 financial years, the Minister
must publish the name of each entity paid an innovation grant
(including an advance on account of an innovation grant) during the
financial year and the total of innovation grants (including advances
on account of innovation grants) paid to the entity during the
financial year.
Item 33: Paragraphs 38(1)(a) and (b)
26. This item amends the information gathering provisions of the Act
consequential on the amendments effected by items 11 and 13.
Item 34: Paragraph 43(a)
27. This item amends the recovery of conditional grants provisions of the
Act consequential on the amendments effected by items 11 and 13.
Item 35: Section 46
28. This item amends the debt recovery by set-off provisions to the
effect that the scheme debts can be set-off against advances on account of
grants as well as grants.
Items 36 and 37: Subparagraph 49(c)(i) and Subsection 52(1)
29. These items amend the false or misleading information offence
provisions, and the delegation powers of the Act consequential on the
amendments effected by items 11 and 13.
Item 38: Subsection 52(1A)
30. This item omits reference to the TCF (SIP) Scheme and includes
reference to the Clothing and Household Textile (BIC) scheme for the
purposes of the powers of delegation, consequential on the amendments
effected by items 13 and 32.
Item 39: Subsection 52(3)
31. This item repeals subsection 52(3) consequential on the amendments
effected by item 13.
Item 40: After subsection 52(3A)
32. This item inserts new subsection 52(3B) to provide for delegation
powers of the Secretary under the Clothing and Household Textile (BIC)
scheme in the same way as subsection 52(3A) provides for delegations to one
or more senior employees of an authorised Commonwealth contractor under the
TCF Post-2005 (SIP) scheme.
Item 41: Subsection 52(4)
33. This item is a technical amendment, consequential on the amendment
effected by item 40.
Item 42: Section 53
34. This item amends the availability of grants provisions of the Act
consequential on the amendments effected by items 11 and 13.
Item 43: Section 54
35. This item repeals section 54, which deals with uniformity of
bounties, consequential on the amendments made by item 13.
Item 44: Subsection 55(3)
36. This item amends the international obligations provisions of the Act
consequential on the amendments effected by items 11 and 13.
Item 45: After section 55
37. This item inserts new section 55A which ensures that the Act validly
applies, and is taken to have always validly applied, to payments to
entities for which there is a connection with relevant Commonwealth heads
of legislative power, viz. a corporation to which section 51(xx) of the
Constitution applies, international and interstate trade (section 51(i) of
the Constitution), and entities carrying on business in a Territory
(section 122 of the Constitution).
Item 46: Transitional provision-section 37X
38. This item inserts a transitional provision that deems an existing
provision of the TCF Post-2005 (SIP) Scheme to be part of the Scheme for
the purposes of the new power inserted into section 37X by item 29 and
ensures that the validity of the Scheme is unaffected by the amendment made
by item 29.
Item 47: Savings provision
39. This item preserves the recovery of scheme debt provisions and
offence provisions that relate to the TCF (SIP) scheme despite the repeal
of Part 2 (TCF (SIP) scheme) and Part 3 (Supplementation of the Regional
Assistance Program) effected by item 13.