BILLS DIGEST NO. 60, 2014–15              2 December 2014

ACT Government Loan Bill 2014

Diane Spooner
Law and Bills Digest Section 

Date introduced: 27 November 2014

House:  House of Representatives

Portfolio: Finance

Commencement:  The day after Royal Assent.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through the Australian Parliament website.

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website.

Purpose of the Bill

The purpose of the ACT Government Loan Bill 2014 (the Bill) is to facilitate a concessional loan to the Australian Capital Territory (ACT) Government of up to $1 billion to undertake a loose-fill asbestos remediation programme in the ACT.

Structure of the Bill

The Bill has four clauses.

Background

From 1968 until 1978, loose-fill, fluffy asbestos was sold by one local firm (‘Mr Fluffy’) as ceiling insulation for residential and commercial premises in Canberra. The asbestos is very fine, which means it is easy to disturb. In 1988, the Commonwealth Government announced a program to remove loose-fill asbestos insulation in the interest of public health. The ongoing responsibility for the removal program was transferred to the ACT Government with self-government in 1989.[1]

The ACT Government’s Asbestos Fact Sheet notes a number of reasons why the removal program was unlikely to have removed all the loose-fill asbestos insulation in all ACT homes, including that the survey to identify houses involved only a visual inspection.[2]

Under the eradication scheme, the ACT Government will acquire, demolish and dispose of all affected homes, remediate affected blocks and then resell those blocks to lessen the overall costs of the scheme.[3]

Senate Standing Committee for the Scrutiny of Bills

At the time of writing the Senate Standing Committee for the Scrutiny of Bills has not considered the Bill.

Parliamentary Joint Committee on Human Rights

At the time of writing the Parliamentary Joint Committee on Human Rights has not considered the Bill.

Policy position of non-government parties/independents

It has been reported in The Canberra Times that the Bill is expected to pass without debate, which suggests that it has bipartisan support.[4]

Position of major interest groups

According to The Canberra Times:

The founder of the Fluffy Owners and Residents’ Action Group said there was widespread disappointment among home owners with the Commonwealth’s response and its refusal to honour a memorandum of understanding with the ACT government over shared funding responsibility for Mr Fluffy.[5]

The Legislative Assembly for the ACT has also introduced the Appropriation (Loose-fill Asbestos Insulation Eradication) Bill 2014–2015, which provides for the appropriation of funds totalling $762.031 million in the
2014–15 fiscal year towards the cost of the loose-fill asbestos insulation eradication scheme.[6]

Financial implications

The Bill if enacted will appropriate $750 million. If the ACT and the Government agree to any further payments, which are not to exceed $250 million (or $1 billion in total), there will be a future appropriation.[7]

Statement of Compatibility with Human Rights

The Statement of Compatibility with Human Rights can be found at page three of the Explanatory Memorandum to the Bill. As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible.

Key issues and provisions

Clause 3 of the Bill provides that the Commonwealth may make a loan of money to the ACT, and the terms and conditions on which the loan is to be made will be set out in a written agreement between the two parties (subclauses 3(1) and (2)). Subclause 3(3) provides that the total amount of the loan is not to exceed $1 billion.

Clause 4 appropriates $750 million from the Consolidated Revenue Fund.

Members, Senators and Parliamentary staff can obtain further information from the Parliamentary Library on (02) 6277 2500.

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[1].              ACT Government, Loose asbestos insulation in the ACT, Asbestos fact sheet, n.d., accessed 1 December 2014.

[2].              Ibid.

[3].              Explanatory Statement, Appropriation (Loose-fill Asbestos Insulation Eradication) Bill 2014–2015 (ACT), accessed 1 December 2014.

[4].              E Macdonald, ‘Emotions surface as Fluffy saga chronicled’, The Canberra Times, 28 November 2014, p. 6, accessed 1 December 2014.

[5].              Ibid.

[6].              Explanatory Statement, op. cit. Appropriation (Loose-fill Asbestos Insulation Eradication) Bill 2014–2015, accessed 1 December 2014.

[7].              Explanatory Memorandum, ACT Government Loan Bill 2014, p. 2, accessed 28 November 2014.