Structured Finance Support (Coronavirus Economic Response Package) Bill 2020 [2020] AUSStaCSBSD 69 (17 April 2020)

• Structured Finance Support (Coronavirus Economic Response Package) Bill 2020
• Delegated legislation not subject to disallowance 30

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Structured Finance Support (Coronavirus Economic Response Package) Bill 2020

Purpose	This bill seeks to establish the Structured Finance Support (Coronavirus Economic Response) Fund to allow the Commonwealth to make investments, to ensure continued access to funding markets economically impacted by the coronavirus, and mitigate the impact of these economic effects on competition in consumer and business lending markets
Portfolio	Treasury
Introduced	House of Representatives on 23 March 2020

Parliamentary scrutiny

Delegated legislation not subject to disallowance ^[30]

1.64 The bill seeks to establish the $15 billion Structured Finance Support (Coronavirus Economic Response) Fund and the Structured Finance Support (Coronavirus Economic Response) Fund Special Account.

1.65 Clause 3 of the bill provides that the objects of the Act are to ensure continued access to funding markets impacted by the economic effects of COVID-19 and to mitigate impacts, resulting from those economic effects, on competition in consumer and business lending markets. These objects are intended to be achieved by the Commonwealth making investments in authorised debt securities and other investments prescribed by the rules. Beyond these broad objects little detail about how the Fund will operate is provided on the face of the bill, although clause 17 sets constitutional limits on the minister’s power to invest amounts in authorised debt securities, etc.

1.66 The committee's view is that significant matters, such as how a fund to which the Commonwealth will invest a significant amount of public money is to operate, should be included on the face of primary legislation unless a sound justification provided. In this instance, the explanatory memorandum contains no explanation as to why further details as to how the Fund is to operate cannot be included in the bill.

1.67 Clause 13 of the bill provides that $15 billion must be credited to the Special Account. Additionally, subclause 13(2) provides that the minister may determine that additional amounts are to be credited to the account. A determination would be a notifiable instrument. The committee notes that notifiable instruments are not subject to the tabling, disallowance or sunsetting requirements imposed on legislative instruments. As such, there can be no parliamentary scrutiny over a notifiable instrument. The explanatory memorandum provides no explanation as to why a determination by the minister will be a notifiable instrument.

1.68 In addition, clause 20 allows the minister to make rules as required or permitted, or that are necessary or convenient to give effect to the provisions of the bill.

1.69 The committee therefore requests the Treasurer’s advice as to:

• how it is intended that the Structured Finance Support (Coronavirus Economic Response) Fund will operate (for example, the decision-making criteria that will be used for making investments, any limits on making investments, and governance arrangements relating to investments);

• why the bill provides that determinations made under subclause 13(2), which credit additional amounts to the Special Account, are not to be subject to parliamentary disallowance; and

• the types of matters that are likely to be included in rules made under clause 20 of the bill.

1.70 The committee also draws this matter to the attention of the Senate Select Committee on COVID-19.

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[30] Clause 13. The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(v).