FINANCIAL FRAMEWORK (SUPPLEMENTARY POWERS) AMENDMENT (SOCIAL SERVICES MEASURES NO. 1) REGULATIONS 2019 (F2019L00167) EXPLANATORY STATEMENT

Commonwealth Numbered Regulations - Explanatory Statements

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FINANCIAL FRAMEWORK (SUPPLEMENTARY POWERS) AMENDMENT (SOCIAL SERVICES MEASURES NO. 1) REGULATIONS 2019 (F2019L00167)

EXPLANATORY STATEMENT

 

Issued by the Authority of the Minister for Finance and the Public Service

 

Financial Framework (Supplementary Powers) Act 1997

 

Financial Framework (Supplementary Powers) Amendment

(Social Services Measures No. 1) Regulations 2019

 

The Financial Framework (Supplementary Powers) Act 1997 (the FF(SP) Act) confers on the Commonwealth, in certain circumstances, powers to make arrangements under which money can be spent; or to make grants of financial assistance; and to form, or otherwise be involved in, companies. The arrangements, grants, programs and companies (or classes of arrangements or grants in relation to which the powers are conferred) are specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the Principal Regulations). 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.

 

Section 65 of the FF(SP) Act provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.

 

Section 32B of the FF(SP) Act authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Principal Regulations. Section 32B also authorises the Commonwealth to make, vary and administer arrangements for the purposes of programs specified in the Principal Regulations. Schedule 1AA and Schedule 1AB to the Principal Regulations specify the arrangements, grants and programs.

 

The Financial Framework (Supplementary Powers) Amendment (Social Services Measures No. 1) Regulations 2019 (the Regulations) amend Schedule 1AB to the Principal Regulations to establish legislative authority for government spending to assist non-government and private sector organisations to make and evaluate social impact investments. 

 

In the 2018-19 Budget, the Government allocated $6.7 million over four years from 2018-19 to build the capacity of the Australian social impact investing (SII) sector to better understand, define and measure its outcomes and impact (the Outcomes Measurement Initiative).

 

Under this initiative, the Government will provide up to $5 million in funding to between one and three well-established not-for-profit or private sector organisations operating in the SII sector. Funding will be provided over four years for the organisations to establish a new, or expand an existing, business or service that generates positive outcomes for its target cohort.

 

Organisations would also undertake analysis of the outcomes and impact generated by the business or service, including the measurement approach taken. This analysis would be used to develop case studies to share the lessons learnt across the SII sector.

 

The initiative will be administered by the Department of Social Services.

 


 

Details of the Regulations are set out at Attachment A. A Statement of Compatibility with Human Rights is at Attachment B.

 

The Regulations are a legislative instrument for the purposes of the Legislation Act 2003. The Regulations commence on the day after they are registered on the Federal Register of Legislation.

 

Consultation

 

In accordance with section 17 of the Legislation Act 2003, consultation has taken place with the Department of Social Services.

 

A regulation impact statement is not required as the Regulations only apply to non-corporate Commonwealth entities and do not adversely affect the private sector.

 

 


Details of the Financial Framework (Supplementary Powers) Amendment (Social Services Measures No. 1) Regulations 2019

 

Section 1 - Name

 

This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Social Services Measures No. 1) Regulations 2019.

 

Section 2 - Commencement

 

This section provides that the Regulations commence on the day after they are 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 activity that will be administered by the Department of Social Services (the department).

 

New table item 333 establishes legislative authority for the Government to provide funding to assist non-government and private sector organisations to make and evaluate social impact investments. 

 

In the 2018-19 Budget, the Government allocated $6.7 million over four years from 2018-19 to build the capacity of the Australian social impact investing (SII) sector to better understand, define and measure its outcomes and impact (the Outcomes Measurement Initiative). Details are set out under the measure 'Social Impact Investing - building outcome measurement capacity' at page 177 of Budget 2018-19, Budget Measures, Budget Paper No. 2 2018-19.

 

SII is an innovative method of financing interventions to address intractable social or environmental problems. SII brings together governments and service providers with investors and uses private capital to create measurable improvements in social or environmental outcomes, often paying a financial return when successful.

 

In Australia, there is currently a nascent SII market. While there are some examples of SII, there are significant barriers preventing further investment opportunities from coming to market. Specifically, for-purpose organisations currently do not have the skills and capabilities to understand and measure outcomes. This is problematic as measurement and evaluation are critical for investors to assess risk and financial returns, and for organisations and governments to assess outcomes and efficacy. While internal evaluation of programs is commonplace, metrics often focus on outputs rather than outcomes, with a short-term rather than long-term focus. As a result, stakeholders have repeatedly expressed the need to build specific, outcome measurement capacity in the SII sector beyond the general capability building available through the SII Sector Readiness Fund, announced in the 2017-18 Budget and opened in 2018. Increased outcome measurement capacity has the potential to create growth in the size and reach of the Australian SII market by improving organisations' ability to prove their social impact and attract investment.

 

Providing funding with a focus on lessons learnt in relation to outcome and impact measurement that can be applied to a broad range of organisations, provides an opportunity to build a stronger culture of robust evaluation and evidence-based decision-making across the social services sector. This includes learning 'what works' and applying it across a range of services.

 

The Outcomes Measurement Initiative is part of the Government's broader $38.6 million commitment to growing the Australian SII market, announced in the 2017-18 and 2018-19 Budgets. This commitment represents early involvement by the Government in SII, with a focus on building the capacity of the Australian SII market and trialling different ways to support SII initiatives in Australia.

 

The Outcomes Measurement Initiative will be implemented by two components: Project One and Project Two. The new table item provides legislative authority for government spending relating to Project One.

 

Under Project One, the Government will provide up to $5 million in funding to between one and three well-established not-for-profit or private sector organisations operating in the SII sector. Funding will be provided over four years for the organisations to establish a new, or expand an existing, business or service that generates positive outcomes for its target cohort. This may involve, but is not limited to, establishing:

        a new site of operation of the existing business or service in a new location

        a new program related to the existing business or service, or

        a social franchise model of an existing program.

 

Organisations would also undertake analysis of the outcomes and impact generated by the business or service, including the measurement approach taken. This analysis would be used to develop case studies to share the lessons learnt across the SII sector.

 

Funding to organisations will depend on the number of organisations approached, but is expected to be between $400,000 and $1.25 million each year for four years from 2018-19. While specific activities supported by the funding will be determined through negotiations with successful organisations, this may include using funding to support:

        service delivery

        business development to expand or establish a business or service

        evaluation, including analysis of service users' outcomes and case study development.

 


 

Under Project Two, the remaining $1.7 million will be used to develop an outcome and impact measurement approach and support the Government to provide a coordination role to enable the sector to navigate existing measurement tools and resources. This coordination role responds to feedback from stakeholders following the 2018-19 Budget announcement confirming the need for help to understand and navigate existing tools and resources.

 

The funding for the organisations under Project One will be made available through a targeted, non-competitive grants process run by the Community Grants Hub conducted in accordance with the Commonwealth Grants Rules and Guidelines 2017. The grant opportunity guidelines for this grant will be made available for the invited organisations on GrantConnect (www.grants.gov.au) and the Community Grants Hub (www.communitygrants.gov.au) websites. Selected organisations will have access to the grant opportunity guidelines through an individual hyperlink on the GrantConnect site.

 

Applications for this grant will undergo an assessment process through the Community Grants Hub which will assess each eligible and compliant application on its individual merit, including how well it meets the grant opportunity guidelines. Following an assessment by the Community Grants Hub, the department will develop a shortlist and make recommendations to the Minister for Families and Social Services. The Minister for Families and Social Services will select the organisations to receive funding and will be the decision-maker for funding decisions for this grant opportunity.

 

The outcome of all grants awarded and funding rounds will be published on GrantConnect no later than 21 working days after the grant agreement takes effect, in accordance with the Commonwealth Grants Rules and Guidelines 2017. 

 

Decisions will be made in accordance with the applicable legislative requirements under the Public Governance, Performance and Accountability Act 2013 and the Commonwealth Grants Rules and Guidelines 2017.

 

Independent review of the funding decisions is not considered to be appropriate. The funding available for this component of the Outcomes Measurement Initiative is specifically allocated across four financial years. Any delay to the administration of the funding may result in a loss of funding available to support organisations. This would undermine the grant process and negatively impact the security of future funding for successful organisations. A decision in relation to the funding amount will also be influenced by the number of organisations funded. As such, there is only a finite amount of resources available and an allocation that has been made to another party would be affected by a review overturning the original decision.

 

The guaranteed right of review under section 75(v) of the Australian Constitution, and review under section 39B of the Judiciary Act 1903, would still be available. Applicants will be notified in writing of the outcomes of their applications. Unsuccessful applicants will be offered feedback on their applications. People affected by administration decisions would also have recourse to the Commonwealth Ombudsman where appropriate.

 

Funding for this measure will come from Program 1.10: Working Age Payments, which is part of Outcome 1. Details are set out in the Portfolio Budget Statements 2018-19 Budget Related Paper No. 1.15, Social Services Portfolio, at pages 23 to 28.

 

Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the following powers of the Constitution:

        the communications power (section 51(v))

        the aliens power (section 51(xix))

        the social welfare power (section 51(xxiiiA))

        the races power (section 51(xxvi))

        the external affairs power (section 51(xxix))

        the territories power (section 122)

        the census and statistics power (section 51(xi))

        the express incidental power and the executive power (sections 51(xxxix) and 61), including the nationhood aspect.

 

Communications power

 

Section 51(v) of the Constitution empowers Parliament to make laws with respect
to 'postal, telegraphic, telephonic and other like services'.

 

Funding may be directed at projects supporting better outcomes for vulnerable people that are delivered online or through a telephone service. For example, funded projects could include online support services for people transitioning out of the prison system or families in financial crisis. Other examples could include online programs to foster inter-generational and inter-cultural community inclusion, or telephone and online support services providing evidence-based information on drug and alcohol misuse.

 

Aliens power

 

Section 51(xix) of the Constitution empowers the Parliament to make laws with respect to 'naturalization and aliens'. The aliens power supports legislation with respect to non-citizens.

 

Funding may be provided to projects that improve the wellbeing and encourage the participation of non-citizens in Australian society. For example, projects could include those providing services, English language training or employment support for newly arrived migrants. Other examples could include projects meeting the safety, security and health needs of non-citizens who have been victims of human trafficking, slavery or forced labour in Australia.

 

Social welfare power

 

Section 51(xxiiiA) of the Constitution gives the Parliament the power to make laws with respect to various social welfare services and benefits, including unemployment benefits and medical services.

 

Funding may be provided to projects that support unemployed and underemployed people into employment, for example, by providing education, training and support to improve their employment opportunities. Other examples could include projects supporting carers who are not in paid employment to find paid employment while in their caring role, or to prepare for paid employment when their caring role ends. Projects could also be funded which support unemployed or underemployed people to attain sustainable self-employment.

 

Funded projects could also support the provision of medical services such as mental health services for disadvantaged young people or services for people affected by drug or alcohol misuse.

 

Races power

 

Section 51(xxvi) of the Constitution empowers Parliament to make laws with respect to 'the people of any race for whom it is deemed necessary to make special laws'. The section supports legislation with respect to Aboriginal and Torres Strait Islander peoples. Funding may be provided for projects that address specific needs of Aboriginal and Torres Strait Islander peoples. 

 

External affairs power

 

Section 51(xxix) of the Constitution gives the Parliament the power to make laws with respect to 'external affairs'. The external affairs power supports legislation implementing Australia's international obligations under treaties to which it is a party.

 

Convention on the Elimination of All Forms of Discrimination against Women

 

Australia has obligations relating to the elimination of all forms of discrimination against women under the Convention on the Elimination of All Forms of Discrimination against Women (CEDAW). In particular:

        under Article 2, States Parties 'condemn discrimination against women in all its forms' and 'agree to pursue by all appropriate means and without delay a policy of eliminating discrimination against women.' Article 2(b) provides that States Parties undertake to adopt 'appropriate legislative and other measures' to this end

        Article 3 requires States Parties to take 'all appropriate measures, including legislation, to ensure the full development and advancement of women, for the purpose of guaranteeing them the exercise and enjoyment of human rights and fundamental freedoms on a basis of equality with men'

        Article 5(a) requires States Parties to take 'all appropriate measures' to 'modify the social and cultural patterns of conduct of men and women, with a view to achieving the elimination of prejudices and customary and all other practices which are based on the idea of the inferiority or the superiority of either of the sexes or on stereotyped roles for men and women'

        Article 16 requires States Parties to 'take all appropriate measures to eliminate discrimination against women in all matters relating to marriage and family relations'.

 

Funding may be provided to projects directed at preventing or addressing issues of discrimination and violence against women. For example, projects could include providing support for women in exercising their rights and freedoms on an equal basis with men; supporting women to escape situations of domestic and family violence; or working to change social and cultural patterns based on the idea of inferiority or the superiority of any sex, or on stereotyped roles for genders.

 


 

Convention on the Rights of the Child

 

Australia also has international obligations regarding the rights of the child under the Convention on the Rights of the Child. In particular:

        Article 4 requires States Parties to undertake 'all appropriate legislative, administrative, and other measures for the implementation of the rights recognized' in the Convention

        Article 6(2) requires States Parties to 'ensure to the maximum extent possible the survival and development of the child'

        Article 18(2) requires States Parties to 'render appropriate assistance to parents and legal guardians in the performance of their child-rearing responsibilities' and to 'ensure the development of institutions, facilities and services for the care of children'

        Article 19 requires States Parties to 'take all appropriate legislative, administrative, social and educational measures to protect the child from all forms of physical or mental violence, injury or abuse, neglect or negligent treatment, maltreatment or exploitation, while in the care of parent(s), legal guardian(s) or any other person who has the care of the child'

        under Article 27(1), States Parties recognise 'the right of every child to a standard of living adequate for the child's physical, mental, spiritual, moral and social development'. Article 27(3) requires States Parties to take 'appropriate measures to assist parents and others responsible for the child to implement this right and shall in case of need provide material assistance and support programmes, particularly with regard to nutrition, clothing and housing'

        under Articles 28 and 29, States Parties recognise 'the right of the child to education' and agree that the education of the child shall be directed to 'the development of the child's personality, talents and mental and physical abilities to their fullest' and to the 'development of respect for the child's parents'.

 

Funding may be provided to projects directed at supporting or improving the development and wellbeing of children, including vulnerable and at-risk children. For example, funding may be provided to projects directed to providing support for children to escape situations of domestic and family violence. Funding could also be provided to projects directed at providing housing or accommodation for families or children at risk of homelessness, or programs aiming to strengthen the family unit by building the skills of parents or guardians to support childhood development.

 

Convention on the Rights of Persons with Disabilities

 

Australia also has international obligations regarding the rights of persons with disabilities, including those set out in the Convention on the Rights of Persons with Disabilities (CPRD). In particular:

        Article 8(1) requires States Parties 'to adopt immediate, effective and appropriate measures' to raise awareness of the capabilities and contributions of people with disabilities, to foster respect for their rights and dignity, and to combat stereotypes, prejudices and harmful practices

        Article 16(1) requires States Parties to take 'all appropriate legislative, administrative, social, educational and other measures to protect persons with disabilities, both within and outside the home, from all forms of exploitation, violence and abuse, including their gender-based aspects'

        Article 19 requires States Parties to 'recognize the equal right of all persons with disabilities to live in the community, with choices equal to others' and requires them to 'take effective and appropriate measures to facilitate full enjoyment by persons with disabilities of this right and their full inclusion and participation in the community'

        Article 26(1) requires States Parties to take effective and appropriate measures 'to enable persons with disabilities to attain and maintain maximum independence, full physical, mental, social and vocational ability, and full inclusion and participation in all aspects of life'

        Article 27 requires that States Parties 'recognize the right of persons with disabilities to work, on an equal basis with others'.

 

Projects may be funded that are targeted at promoting, protecting and securing the rights of people with disability, as well as ensuring their full and equal participation in society. For example, projects may be directed at enabling people with disability to become and remain independent, or at preventing violence against, or abuse of, people with disability. Alternatively, projects could be directed at increasing the effective participation in society of people with long-term mental impairments, on an equal basis with others.

 

International Convention on the Elimination of All Forms of Racial Discrimination

 

Australia also has obligations under the International Convention on the Elimination of All Forms of Racial Discrimination (ICERD). In particular:

        under Article 2(1), States Parties 'condemn racial discrimination and undertake to pursue by all appropriate means and without delay a policy of eliminating racial discrimination in all its forms and promoting understanding among all races'. Under Article 2(2), States Parties are required to 'take, in the social, economic, cultural and other fields, special and concrete measures to ensure the adequate development and protection of certain racial groups or individuals belonging to them, for the purpose of guaranteeing them the full and equal enjoyment of human rights and fundamental freedoms'

        Article 7 requires States Parties 'to adopt immediate and effective measures, particularly in the fields of teaching, education, culture and information, with a view to combating prejudices which lead to racial discrimination and to promoting understanding, tolerance and friendship among nations and racial or ethnic groups'.

 

Projects may be funded which seek to eliminate racial discrimination and promote inclusion, harmony and understanding between cultures. For example, projects funded under this measure could include social integration of diverse social, cultural and religious groups in a community or building strong and inclusive communities.

 


 

International Covenant on Economic, Social and Cultural Rights

 

Australia also has international obligations under the International Covenant on Economic, Social and Cultural Rights. In particular:

        Article 2(1) requires States Parties to take steps to achieve the full realisation of the rights recognised in the Covenant 'by all appropriate means, including particularly the adoption of legislative measures'

        Article 6 recognises 'the right to work' and requires States Parties to 'take appropriate steps to safeguard this right' including the implementation of 'programmes ... to achieve ... full and productive employment' 

        Article 11(1) recognises 'the right of everyone to an adequate standard of living for himself and his family, including adequate food, clothing and housing, and to the continuous improvement of living conditions'. Article 11(1) also requires States Parties to 'take appropriate steps to ensure the realization of this right'

        Article 12 requires States Parties to 'recognize the right of everyone to the enjoyment of the highest attainable standard of physical and mental health'

        Article 12(2)(c) requires States Parties to take steps necessary for 'the prevention, treatment and control of epidemic, endemic, occupational and other diseases' and to take steps necessary for 'the creation of conditions which would assure to all medical service and medical attention in the event of sickness'. Article 12(2)(d) requires States Parties to take steps necessary for the 'creation of conditions which would assure to all medical service and medical attention in the event of sickness'

        Article 13 requires States Parties to 'recognize the right of everyone to education' and requires States Parties to take steps to realise this right.

 

Funding may be provided to projects directed at fulfilling the rights of individuals to health, education, work, and an adequate standard of living. For example, funded projects may be directed at treating health conditions arising from drug or alcohol misuse, or supporting unemployed or underemployed people into employment. Projects may also be funded which are directed at reducing homelessness and malnutrition, for example, by supporting access to adequate accommodation or affordable, adequate and nutritious food. Projects may also be funded to improve educational outcomes for disadvantaged children and children living in remote and regional communities.

 

International Labour Organization Conventions

 

Australia also has obligations under International Labour Organization Conventions on Employment Policy (ILO Convention 122) and Vocational Guidance and Vocational Training in the Development of Human Resources (ILO Convention 142). In particular:

        Articles 1 and 2 of the ILO Convention 122 require States Parties to pursue 'an active policy designed to promote full, productive and freely chosen employment', including deciding on and keeping under review measures to attain this objective

        Articles 1 and 2 of the ILO Convention 142 oblige States Parties to adopt policies and programs of vocational guidance and training, linked with employment. These policies and programs, whether or not offered in the formal education system or outside it, should be designed to improve the ability of the individual to understand and influence the working and social environment, and should encourage and enable all persons, without discrimination, to develop and use their capabilities for work in their own best interests and aspirations, and taking into account the needs of society

        Article 3 of the ILO Convention 142 requires States Parties to extend its systems of vocational guidance to ensure that comprehensive information is available to all children, young persons and adults, including appropriate programs for all handicapped and disabled persons

        Article 4 of the ILO Convention 142 requires States Parties to extend systems of vocational training systems to meet the needs for vocational training throughout life of young persons and adults in all sectors and at all levels of skill and responsibility.

 

Projects may be funded that are directed at supporting people into employment by providing unemployed and underemployed people with educational and training programs and necessary support which is directly related to improving a person's opportunity to find paid employment.

 

International conventions regarding narcotic drugs and psychotropic substances

 

Australia has obligations regarding drug control under the Single Convention on Narcotic Drugs, the Convention on Psychotropic Substances, and the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances. In particular:

        under Article 38 of the Single Convention on Narcotic Drugs, States Parties are required to 'give special attention to and take all practicable measures for the prevention of abuse of drugs and for the early identification, treatment, education, after-care, rehabilitation and social reintegration of the persons involved and shall co-ordinate their efforts to these ends'

        under Article 20 of the Convention on Psychotropic Substances, States Parties are required to 'take all practicable measures for the prevention of abuse of psychotropic substances and for the early identification, treatment, education, after-care, rehabilitation and social reintegration of the persons involved, and shall co-ordinate their efforts to these ends'

        Article 14(4) of the United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic Substances requires States Parties to 'adopt appropriate measures aimed at eliminating or reducing illicit demand for narcotic drugs and psychotropic substances, with a view to reducing human suffering and eliminating financial incentives for illicit traffic'.

 

Funding may be provided for projects directed at reducing the impact of substance misuse on individuals, families, carers and communities. For example, projects could include the provision of drug and alcohol treatment services, including through prevention, diagnosis and early intervention activities or treating health conditions arising from drug or alcohol misuse.

 

Territories power

 

The provision of funding for activities in or in relation to a Territory is supported by section 122 of the Constitution. The program will assist access and receipt of support, including in the Northern Territory and the Australian Capital Territory. 

 


 

Census and statistics power

 

The census and statistics powers (section 51(xi) of the Constitution) supports activities for a range of information for statistical purposes, including those in connection with the collection, compilation, analysis and dissemination of statistics.

 

With respect to the census and statistics power, the item authorises expenditure on technical infrastructure and tools that integrate and link statistical data, as well as the collection of information for statistical purposes.

 

Commonwealth executive power and express incidental power, including the nationhood aspect

 

The express incidental power (section 51(xxxix) of the Constitution) empowers the Parliament to make laws with respect to matters incidental to the execution of any power vested in it by the Constitution. Together with the executive power (section 61 of the Constitution), section 51(xxxix) supports activities that are peculiarly adapted to the government of a nation and cannot be carried out for the benefit of the nation otherwise than by the Commonwealth.

 

Funding may be provided for the evaluation of the outcomes and impact of funded services and businesses. Data and findings collected through these evaluations would then be used to inform future government policy on supporting SII in Australia.

 

 

 


 

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 (Social Services Measures No. 1) Regulations 2019

 

This disallowable legislative instrument is 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 FF(SP) 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 Financial Framework (Supplementary Powers) Amendment (Social Services Measures No. 1) Regulations 2019 amend Schedule 1AB to the FF(SP) Regulations to add new table item 333 to Part 4 of that schedule to establish legislative authority for government spending to assist non-government and private sector organisations to make and evaluate social impact investments. The legislative authority will allow the Commonwealth to fund not-for-profit and private sector organisations operating in the Australian social impact investing (SII) sector to establish a new, or expand an existing, business or service ('scale a business or service') and share lessons learnt of service outcomes and impact measurement with the Australian SII sector.

 

SII is an innovative method of financing interventions to address intractable social or environmental problems. SII brings together governments and service providers with investors and uses private capital to create measurable improvements in social or environmental outcomes, often paying a financial return when successful.

 

The Australian Government announced the 'Social Impact Investing - Building Outcome Measurement Capacity' (Outcomes Measurement Initiative) in the 2018-19 Budget to build the capacity of the Australian SII sector to better understand, define and measure its outcomes and impact. This initiative would involve funding one to three well-established organisations operating in the SII sector to establish a new, or expand an existing, business or service that generates positive outcomes for its target cohort. Organisations will undertake analysis of the outcomes and impact generated by the business or service, including the measurement approach taken. This analysis will then be used to develop case studies to inform future government SII policy and share lessons learnt across the SII sector.

 

Funding will depend on the number of organisations approached, but it is expected that organisations will receive between $400,000 and $1.25 million each year for four years (2018-19 to 2021-22). While specific activities supported by the funding will be determined through negotiations with successful organisations, they may include:

*         service delivery

*         business development to scale a business or service

*         evaluation, including analysis of service users' outcomes and case study development.

 

The Outcomes Measurement Initiative is part of the Australian Government's broader $38.6 million commitment to growing the Australian SII market, announced in the 2017-18 and 2018-19 Budgets.

 

The Minister for Families and Social Services has portfolio responsibility for this initiative which will be administered by the Department of Social Services.

 

Human rights implications

 

This legislative instrument engages the following human rights:

*         the rights of parents and children - Article 3 of the Convention on the Rights of the Child (CRC) and Article 24(1) of the International Covenant on Civil and Political Rights (ICCPR)

*         the right to protection from exploitation, violence and abuse - Article 19(1) of the CRC and Article 16(1) of the Convention on the Rights of Persons with Disabilities (CRPD)

*         the right to work and rights at work - Article 6(1) of the International Covenant on Economic, Social and Cultural Rights (ICESCR)

*         the right to an adequate standard of living, including food, water and housing - Article 11(1) of the ICESCR

*         the right to health - Article 12(1) of the ICESCR

*         the rights of people with disability - Articles 8(1), 16(1) 19, 26(1), 27 and 29 of the CRPD.

 

Rights of parents and children

 

In addition to the rights enjoyed by all persons under human rights treaties, parents and children enjoy special rights, particular to their status. This measure engages the rights contained in Articles 4, 6, 18, 19, 27, 28 and 29 of the CRC and Article 24(1) of the ICCPR.

 

This instrument promotes these rights by allowing government to fund or invest in social impact investments that run projects directed at supporting or improving the development and wellbeing of children, including vulnerable and at-risk children. For example, funding may be provided to projects that provide support for children to escape situations of domestic and family violence. Funding could also be provided to projects directed at providing housing or accommodation for families or children at risk of homelessness, or programs aiming to strengthen the family unit by building the skills of parents or guardians to support childhood development.

 


 

Right to protection from exploitation, violence and abuse

 

The right to protection from exploitation, violence and abuse requires countries to take measures to protect persons from exploitation, violence and abuse. This measure engages the rights contained in Article 19(1) of the CRC and Article 16(1) of the CRPD.

 

This instrument promotes these rights by allowing government to fund or invest in social impact investments that provide services to or benefit vulnerable groups at risk of exploitation, violence, or abuse. This may include organisations that run programs aimed at reducing domestic and family violence.

 

Right to work and rights at work

 

The right to work includes the right of everyone to the opportunity to gain his or her living by work which he or she freely chooses or accepts. Rights at work include the enjoyment of just and favourable conditions or work, and to form and join trade unions. This measure engages the rights contained in Article 6(1) of the ICESCR. 

 

This instrument promotes these rights by allowing government to fund or invest in social impact investments that provide services to or benefit unemployed and underemployed people. This may include organisations that run programs aimed at decreasing youth unemployment or that help people with disability obtain paid employment.

 

Right to an adequate standard of living, including food, water and housing

 

This measure engages the right to an adequate standard of living, including food, water and housing, contained in Article 11 of the ICESCR.

 

This instrument promotes this right by allowing government to fund or invest in social impact investments that provide services to or benefit people experiencing homelessness.

 

Right to health

 

The right to health is the right to the enjoyment of the highest attainable standard of physical and mental health. It is contained in Article 12(1) of the ICESCR.

 

This instrument promotes this right by allowing government to fund or invest in social impact investments that provide services that reduce the impact of substance misuse on individuals, families, carers and communities.

 

Rights of people with disability

 

In addition to the rights enjoyed by all persons under human rights treaties, people with disability are afforded special rights, particular to their status. This measure engages the rights contained in Articles 8(1), 16(1) 19, 26(1), 27 and 29 of the CRPD.

 

This instrument promotes these rights by allowing government to fund or invest in social impact investments that provide services to people with disability. For example, projects may support people with disability to become and remain independent, or work to prevent violence against or abuse of people with disability. Alternatively, projects could be directed to increasing the effective participation in society of people with long-term mental impairments, on an equal basis with others.

 

Conclusion

 

This legislative instrument is compatible with human rights because it promotes the protection of human rights.

 

The Outcomes Measurement Initiative will provide grant funding to organisations with an existing program that has a record of creating a positive impact for its target cohort. As such, the risk that a program could unintentionally infringe on a human right is small. The Outcomes Measurement Initiative also mandates that organisations define and measure the outcomes and impact of their funded program. The Department of Social Services will monitor the evaluation closely and, in the unlikely event a negative impact occurs on any human right, amend or cancel the program.

 

 

 

 

 

 

Senator the Hon Mathias Cormann

Minister for Finance and the Public Service


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