Essential public asset restoration or replacement to pre-disaster standard The requirements for restoration or replacement of an asset are: the asset is an essential public asset; and the restoration or replacement results in the asset being restored or replaced to its pre-disaster standard, in accordance with current building and engineering standards. Essential public asset betterment In this Determination betterment, in relation to an asset, means the restoration or replacement of the asset to a more disaster-resilient standard than its standard. Betterment of an asset will be considered an eligible measure if: the is an essential public asset; and the informs the Secretary of its decision to restore the asset to a more disaster-resilient standard, and of its reasons for doing so; and the Secretary is satisfied with the cost effectiveness of the proposal; and the Secretary is satisfied that the increased disaster-resilience of the asset will mitigate the impact of future natural disasters. Additional requirements for Category B measures—loans, subsidies or grants assistance to a small business or primary producer The requirements for a scheme of loans assistance at a concessional interest rate to a small business or primary producer are: the loan is made by the state to a small business or primary producer; and the is satisfied that the borrower’s assets (including fodder) have been significantly damaged by the natural disaster; and the state is satisfied that the borrower has no reasonable prospect of obtaining commercial finance but has a reasonable prospect of long-term viability for the business; and the loan is established in accordance with the requirements (if any) of Schedule 1 of this Determination. Loans assistance to a needy individual or voluntary non-profit body The requirements for a scheme of loans assistance at a concessional interest rate to a needy individual or voluntary non-profit body are: the loan is made by the to a needy individual or voluntary non-profit body; and the state is satisfied that the borrower’s assets have been significantly damaged by the natural disaster; and the is satisfied that the borrower has no reasonable prospect of obtaining commercial finance; and
Category C measures; and Category D measures. HOW IS THE LEVEL OF ASSISTANCE CALCULATED? Overview Eligibility for assistance Eligibility for Commonwealth assistance in a financial year is worked out on the basis of state expenditure in that year on eligible disasters (see clauses 5.2 – 5.4). Rate of assistance If a state is eligible for assistance in a financial year, the rate of the assistance is worked out on the basis of the state’s two thresholds for that financial year and the amount of its expenditure in that year on all eligible disasters (see clauses 5.7 – 5.10). Reduction in rate of assistance If a fails to take appropriate action within a reasonable time in response to the Commonwealth Attorney-General's recommendations for changes to a state's insurance arrangements (see clause 4.6.5) then the rate of the assistance calculated under this Part 5 may be reduced. Meaning of state expenditure In this Determination state expenditure means the amount actually spent, or expected to be spent within 6 months, by a state in respect of an eligible measure. The amount includes the cost to the state of eligible measures in the form of non-monetary assistance (for example, goods, waived revenue, free or subsidised services). The amount includes the cost to the state of eligible measures in the form of concessional interest rate loans. Note: if any part of state expenditure is in the form of concessional interest rate loans, a component of the Commonwealth assistance will also be in the form of a loan—see clause 5.11. The amount must be or the cost incurred, by the state within the allowable time limit. The amount does not include any of the following: amounts that the state has recovered or may recover from any source; amounts that a person is liable to reimburse to the state (including amounts attributable to GST);
Basis for calculation of assistance—first and second threshold If Commonwealth assistance is payable under subclause 5.1.1 in relation to state expenditure on an eligible disaster, the calculation of the assistance is based on: the threshold, being 0.225 per cent of the state’s total general government sector revenue and grants in the financial year two years prior to the relevant financial year; and the second threshold, being 1.75 times the state’s first threshold. The Secretary must inform the states, in writing, of their respective thresholds as soon as the figures are available from the Australian Bureau of Statistics. Formula for calculation of amount of Commonwealth assistance Commonwealth assistance during a financial year for state expenditure on Category A, B and C measures is calculated at the rate of: if the state’s first threshold has not been exceeded—50 per cent of state expenditure on Category A and C measures for one or more eligible disasters; and if the state’s first threshold has been exceeded—50 per cent of state expenditure on Category A, B and C measures for one or more eligible disasters, between a state’s first and second threshold; plus 75 per cent of all such state expenditure in excess of the state’s second threshold. If the first threshold has been exceeded but the assistance calculated under subclause 5.8.1(a) would be greater than that calculated under subclause 5.8.1(b), the state may opt to restrict its claim to the Category A and Category C component calculated under subclause 5.8.1(a) (even though its first threshold has been exceeded). Commonwealth assistance during a financial year for expenditure on Category D measures for one or more eligible disasters is to be calculated at the rate determined by the Commonwealth. Calculation of assistance if state has paid two-thirds or more of betterment costs of local government asset If: a has given assistance for the betterment of an essential public asset owned by a local government body; and the state’s assistance represents two-thirds or more of the total cost of the betterment; then, for the purpose of calculating Commonwealth assistance under clause 5.8, the amount of state expenditure attributable to the betterment is taken to be two-thirds of the total cost of the betterment. However, if the asset in question is the asset of a remote indigenous community or a low financial capacity local government body, and the
Attachment B (General Claim Form) and Attachment C (Expenditure Breakdown Form). Note 1: see clause 7.4 regarding the acceptance of an audited financial statement as a claim. Note 2: for further details on submitting a claim see Guideline 1/2007. Claim must be supported by certified statement of expenditure Each general claim must be supported by a statement certified by an officer of the state Treasury, or an officer of the agency which has responsibility for the state in relation to the Natural Disaster Relief and Recovery Arrangements. The statement must be in the form set out in Attachment B (General Claim Form). Commonwealth may request additional information After receipt of a claim, the Secretary may at any time ask the state to provide information that the Secretary considers necessary to ensure that payment is in accordance with the principles and guidelines in this Determination. Process for resolving disagreement claimed amount A must provide the information requested by the Secretary within a reasonable time. If the information indicates that payment of all or part of the amount of the claim would be inconsistent with this Determination, payment in respect of that part or amount will be withheld. If no agreement can be reached between officials of the state and the Secretary, the matter is to be referred for resolution to the Minister. WHAT ARE THE ACQUITTAL AND AUDIT REQUIREMENTS? State must provide audited financial statement If a state has: made a claim under clause 6.1, or received an advance payment from the Commonwealth under subclause 1.2.3; the state must provide an audited financial statement in support of that claim or as evidence of state expenditure of the advance payment, as the case requires. The statement must be in the form of Attachment C (Expenditure Breakdown Form), Attachment D (Independent Audit Report) and Attachment E (Audited Financial Statement Claim Form) and must be certified by the Auditor-General of that state (or his or her delegate). Note 2: for further details on submitting a claim see Guideline 1/2007. Time limit for provision of audited financial statement An audited financial statement in support of a claim must be made as soon as practicable after the end of the financial year in which the claim, or advance payment, was made. If the state is unable to comply within 6 months after the
CRITERIA FOR THE PROVISION OF INTEREST RATE SUBSIDIES Pursuant to clause 9.1, Natural Disaster Relief and Recovery Arrangements Determination, the following guideline applies to the criteria for the provision of interest subsidies. Guidelines Under subclauses 3.3.2(d) and 3.7.4 of the Determination states are able to seek reimbursement for subsidies made to small businesses or primary producers to cover the interest costs of commercially raised loans used for recovery from an eligible disaster, subject to the following: reimbursement is only available for interest on loans that have been provided by private sector authorised deposit taking institutions (ADTIs ); the subsidy be capped as per Schedule 1 of the Determination; claimants apply to states who assess eligibility. Successful claimants are issued with a letter from states, which they provide to a participating ADTI. The ADTI assesses the claimant against lending guidelines developed under this scheme; and loans provided by ADTIs are to be over a maximum 10-year period. The subsidy will continue each year, diminishing to zero after 10 years. Where the interest rate subsidy measure is adopted, only the subsidy component will be considered state expenditure, not the loan principal element. NATURAL DISASTER RELIEF AND RECOVERY ARRANGEMENTS GUIDELINE 3 / 2007 CRITERIA FOR THE PROVISION OF EVIDENCE OF NATURAL DISASTER MITIGATION STRATEGIES Pursuant to clause 9.1, Natural Disaster Relief and Recovery Arrangements Determination, the following guideline applies to the criteria for the provision of evidence of natural disaster mitigation strategies. Guidelines The Commonwealth considers that disaster mitigation, in partnership with state governments, is an important principle to be advanced under the Natural Disaster Relief and Recovery