Details of the Financial Framework (Supplementary Powers) Amendment (Defence Measures No. 3) Regulations 2017

 

Section 1 - Name

 

This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Defence Measures No. 3) Regulations 2017.

 

Section 2 - Commencement

 

This section provides that the Regulations commence on the day after the instrument is registered on the Federal Register of Legislation. 

 

Section 3 - Authority

 

This section provides that the Regulations are made under the Financial Framework (Supplementary Powers) Act 1997.

 

Section 4 - Schedules

 

This section provides that the Financial Framework (Supplementary Powers)

Regulations 1997 are amended as set out in the Schedule to the Regulations.

 

Schedule 1 - Amendments

 

Item 1 - In the appropriate position in Part 4 of Schedule 1AB (table)

 

This item adds a new table item to Part 4 of Schedule 1AB to establish legislative authority for government spending on an initiative that falls within the responsibility of the Department of Defence. 

 

New table item 246 establishes legislative authority for government spending on the US-Australia International Multidisciplinary University Research Initiative (AUSMURI) program.

 

The AUSMURI program will provide funding support for Australian higher education providers (universities) to collaborate with their US counterparts on large multidisciplinary projects on designated topics under the Multidisciplinary University Research Initiative (MURI) grant scheme operated by the US Department of Defense.

 

The US MURI provides funding opportunities to US universities on a range of topics with potential for future defence capability.  A MURI funding opportunity announcement is made once per year, inviting submissions from groups of universities seeking to collaborate on the announced topics.

 

The Australian Department of Defence (Defence) and the US Department of Defense have agreed to encourage Australian universities to participate in MURI on topics determined by Defence as having high potential for significant future defence capabilities (designated topics).

 

Funding for the AUSMURI program of up to $25 million over nine years from 2017-18 will be provided from the Next Generation Technologies Fund, which was announced in the 2016 Defence Industry Policy Statement accompanying the 2016 Defence White Paper.  Defence has responsibility for the AUSMURI program, which will be administered by AusIndustry, part of the Department of Industry, Innovation and Science.

 

The key benefits of the AUSMURI program include:

*         increased skills, capacity and networks (both domestic and international) for Australian universities in fields of high potential for game-changing future defence capabilities, providing a strong base of expertise and facilities for Defence to draw on;

*         advancement of scientific research in transformational technologies, positioning Defence to earlier exploit and better protect against disruptive innovation in capabilities; and

*         substantial leverage of the US co-investment in large collaborative scientific research projects, facilitating knowledge transfer and a larger scale of scientific research activity.

 

Before the introduction of the AUSMURI program, Australian universities could collaborate on MURI projects but could not receive MURI grant funding since it is restricted to US institutions only.  The AUSMURI program provides local funding support to enable cross-border collaborative projects of substantial scale.  The program is open to Australian universities involved in a successful MURI submission on a designated topic.

 

Defence will determine the designated topics for each AUSMURI round based on existing technology foresighting activities, detailed requirement scoping and assessment of candidate topics against set selection criteria.

 

Grant funding will cover 100 per cent of eligible project costs up to a maximum of $1 million per year over three years for each project.  The grant period may be extended for a further two years by up to a maximum of $1 million per year.  Total grant funding may not exceed $3 million for a three-year project or $5 million for a five-year project.

 

AusIndustry will administer the AUSMURI grants, with Defence involved in the related MURI selection process, including technical assessment of proposals (submissions) for that scheme.  This allows the AUSMURI program to only require that eligibility criteria are met, since project proposals would have already been thoroughly assessed by an international panel against merit criteria, including consideration of value for money.

 

Technical progress reports will be reviewed by Defence to ensure progress meets expectations and to capture new concepts and advancements that could be transferred to other Defence programs for further development as future defence capability.

 

The Minister for Defence Industry, the Hon Christopher Pyne MP, announced the AUSMURI program on 23 May 2017 (www.pyneonline.com.au/media-centre/media-releases/25-million-for-australian-universities-to-work-with-top-us-counterparts).

 

The AUSMURI program guidelines provide information about the grant process.  These guidelines and other relevant information are available at www.business.gov.au/ausmuri.  The AUSMURI grant process is reliant on the project proposals meeting eligibility criteria under the US MURI grant scheme, which assesses project proposals against selection criteria for technical merit and value for money.

 

A new AUSMURI funding round with the designated topics is expected to be announced annually.  The announcement will coincide with each MURI announcement so that universities from both countries can form a team and submit a collaborative MURI project proposal.  The formal application round for AUSMURI grants will open immediately after the MURI winning proposals (submissions) are announced by the US Department of Defense.  The first AUSMURI funding round is expected to open in April 2018.

 

AusIndustry has the primary responsibility for assessing AUSMURI applications for eligibility and making funding recommendations to the Minister for Defence.  The Minister will be the final decision-maker, with the right to not approve a project proposal if it is not in the national interest.

 

AusIndustry will negotiate funding agreements with the successful grant applicants.  Non-sensitive information about the grant recipients will be published on the GrantConnect (www.grants.gov.au) and the Defence Innovation Portal websites (www.business.gov.au/centre-for-defence-industry-capability/defence-innovation-portal).

 

The grant process will comply with the Commonwealth Grants Rules and Guidelines.

 

There will be no merits review of decisions to provide grant funding under the AUSMURI program, as grant funding is subject to the collaborative project proposals being selected for funding by the US MURI grant scheme.

 

Complaints about the handling of administrative processes associated with the AUSMURI program may be made to the AusIndustry Contact Centre, the Head of AusIndustry's Business Services Division, or the Commonwealth Ombudsman.  Further information about the complaints process is available in the program guidelines.

 

Funding for this item will come from Program 2.4: Vice Chief of the Defence Force, which is part of Outcome 2.  Details are set out in the Portfolio Budget Statements 2017-18, Budget Related Paper No. 1.4A, Defence Portfolio at page 58.  Funding of up to $25 million over nine years from 2017-18 has been allocated to support the AUSMURI program.

 

The AUSMURI program funding is part of the $29.9 billion for the 2016 Defence White Paper that was included in the 2016-17 Budget.  Details are set out in the measure '2016 Defence White Paper - additional funding' in Budget 2016-17, Budget Measures, Budget Paper No. 2 2016-17 at page 169.

 

Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the defence power (section 51(vi)) of the Constitution.

 

The program will fund basic research that is likely to improve Australia's defence capabilities.

 

 

 

Statement of Compatibility with Human Rights

 

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

 

Financial Framework (Supplementary Powers) Amendment (Defence Measures No. 3) Regulations 2017

 

These Regulations are 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 of the Legislative Instrument

 

Section 32B of the Financial Framework (Supplementary Powers) Act 1997 (the FF(SP) Act) authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the FF(SP) Regulations) and to make, vary and administer arrangements and grants for the purposes of programs specified in the Regulations.  Schedule 1AA and Schedule 1AB to the FF(SP) Regulations specify the arrangements, grants and programs.  The FF(SP) Act applies to Ministers and the accountable authorities of non-corporate Commonwealth entities, as defined under section 12 of the Public Governance, Performance and Accountability Act 2013. 

 

The Regulations amend Schedule 1AB to the FF(SP) Regulations to establish legislative authority for government spending on the US-Australia International Multidisciplinary University Research Initiative (AUSMURI) program.  The purpose of the AUSMURI program is to provide funding support for Australian universities to collaborate with their US counterparts on large multidisciplinary projects on designated topics under the Multidisciplinary University Research Initiative grant scheme operated by the US Department of Defense. 

 

Key benefits of the AUSMURI program include increased skills, capacity and networks for Australian universities in technology fields of high potential for future defence capabilities, earlier exploitation and better protection against disruptive innovation in capabilities, and substantial leverage of the US co-investment in large collaborative scientific research projects.  The Department of Defence has responsibility for this program, which will be administered by AusIndustry, part of the Department of Industry, Innovation and Science.

 

Program funding of up to $25 million over nine years from 2017-18 will be provided from the Next Generation Technologies Fund which was announced in the 2016 Defence Industry Policy Statement. 

 

The Minister for Defence Industry has responsibility for this initiative.

 

Human rights implications

 

The Regulations do not engage any of the applicable rights or freedoms.

 

Conclusion

 

These Regulations are compatible with human rights as they do not raise any human rights issues.

 

Senator the Hon Mathias Cormann

Minister for Finance