Local Government (Financial Assistance) (Final Factor for 2024-25 and Estimated Factor for 2025-26) Determination 2025

The instrument rests on a small number of statutory and technical concepts that govern how Commonwealth financial assistance to local government is quantified and timed.

• Factor. The term "factor" refers to the multiplier required by subsection 8(1) of the Local Government (Financial Assistance) Act 1995. This instrument directly determines the numeric factor for the 2024‑25 year (final factor 0.7945, s 5) and an estimated factor for 2025‑26 (0.7739, s 7). The instrument does not itself explain how those factors alter each council’s individual grant; that mapping exists in the Act and associated regulations or administrative guidance. The instrument states that expressions have the same meaning as in the Act (s 4).

• Paragraph 8(1)(a) formula. The factor is first calculated in accordance with paragraph 8(1)(a) of the Act, which the instrument implements using two inputs: population change ratios and CPI change ratios. For 2024‑25 the instrument shows the population numerator 26,949,102 divided by denominator 26,310,635, multiplied by CPI 140.7/137.4 to yield 1.04887 (s 6(2) and notes). For 2025‑26 the instrument shows 27,395,019 / 26,949,102 multiplied by CPI 145.6/140.7 to yield 1.05195 (s 8(2) and notes).

• Paragraph 8(1)(b) rounding rule. After the paragraph (a) result, paragraph 8(1)(b) of the Act is applied where applicable to adjust the result. The instrument increases the result by 0.0001 in both years because the fifth decimal place of the paragraph (a) result was greater than 4 (s 6(3), s 8(3)). The instrument thereby documents the concrete rounding operation as required by the Act.

• Paragraph 8(1)(c) special‑circumstances adjustment. The instrument applies paragraph 8(1)(c) of the Act to modify the factor for "special circumstances" in both years. In 2024‑25 the modification accounts for the Commonwealth bringing forward 85 per cent of payments in 2024‑25 into 2023‑24 and 50 per cent of payments in 2025‑26 into 2024‑25; the instrument records the algebraic multiplier used (s 6(4)). In 2025‑26 the modification accounts for the Commonwealth bringing forward 50 per cent of 2025‑26 payments into 2024‑25 and records the multiplier used (s 8(4)). The instrument defines the elements used in those multipliers (for example, "2024‑25 amount", "2023‑24 amount", "2023‑24 final entitlement", "sub (3) factor") so the reader can trace the arithmetic (s 6(4) and s 8(4) definitions).

• Data provenance. The instrument ties each numerical input to a specific published source and date. Population estimates were taken from the Australian Bureau of Statistics on specific dates identified in the notes (s 6 notes 1-2; s 8 notes 1-2). CPI numbers are either ABS published March quarter indices or Treasury budget forecasts as specified (s 6 notes 3-4; s 8 notes 3-4). Those references matter because the formulaic result depends on the snapshot chosen.

• Commencement. The instrument commences the day after registration for the whole instrument, as recorded in the commencement table (s 2(1) and table note). The instrument also records that the table’s column 3 information is not part of the instrument (s 2(2)).

Collectively, these concepts show that the instrument is a numeric, data‑anchored application of the Act’s factor methodology, together with statutory rounding and a bespoke timing correction to reflect the Commonwealth’s decision to bring forward specified payments.

The instrument affects three classes of actors in concrete, distinct ways.

1. Local governments (recipient bodies under the Act). The factors set by this instrument enter directly into the calculation of Commonwealth financial assistance under subsection 8(1) of the Local Government (Financial Assistance) Act 1995. While the instrument does not itself specify each council’s grant amount, the factor is an input into the statutory allocation formula that determines the size of payments to councils. Changing the factor therefore affects the aggregate pool of funds to be distributed for the relevant year, and through the Act’s allocation procedures it will affect individual councils’ entitlements. The instrument makes this explicit by stating the factor is determined “for the purposes of” the relevant Act provisions (s 5; s 7).

2. Commonwealth budget and cash managers (the decision makers who brought payments forward). The instrument records that the Commonwealth made decisions to bring forward 85 per cent of 2024‑25 payments into 2023‑24 and 50 per cent of 2025‑26 payments into 2024‑25. Those budgetary timing decisions alter the pattern of cash flows between years for both the Commonwealth and local government recipients. The instrument operationalises those timing choices by adjusting the factor using algebraic multipliers intended to reflect the fiscal sequencing consequences (s 6(4), s 8(4)). This means the Commonwealth Treasury and appropriation processes bear responsibility for the timing and the instrument memorialises the accounting effect of those decisions.

3. State and territory administrations that administer allocation to councils. Many states and territories pass Commonwealth financial assistance to local government through established distribution mechanisms. These agencies need to incorporate the factors into their internal grant calculations and cashflow planning for the affected years. The instrument’s explicit mention that it relies on the Act’s definitions (s 4) signals to state administrators that they must apply the factor within the Act’s broader statutory framework, not in isolation.

The instrument does not change statutory entitlements in any other way. It does not create new obligations on councils beyond receiving or accounting for altered grant amounts. The instrument itself does not impose penalties, conditions, or reporting obligations on recipients; it is a numeric determination required by the Act (see s 5 and s 7 for the determinations; s 3 for authority). Practitioners should note that the instrument’s effect is primarily financial and temporal: it changes the quantum and timing of Commonwealth financial assistance by fixing the factor numbers and explaining the timing correction applied.

Who pays. Operationally, the Commonwealth remains the payer of the grants whose quantum is scaled by the factor determined here. The instrument records the Commonwealth’s internal decision to accelerate payments between years and then recalculates factors accordingly (s 6(4), s 8(4)). Councils are recipients, not payers, in this context.

Who decides. The Assistant Minister for Productivity, Competition, Charities and Treasury made the determination on 26 June 2025 and signed the instrument (instrument header and signature). The legal authority for that act is the Local Government (Financial Assistance) Act 1995, under which the Minister or delegate sets factors for the purposes noted (s 3).

This instrument is primarily declarative rather than prescriptive. It fixes numbers and documents the calculation steps; it does not impose new statutory duties on third parties nor confer new enforceable rights beyond those already established in the Local Government (Financial Assistance) Act 1995. The key duties and rights to note, as implied by the instrument, are the following.

• Obligation of the Commonwealth to apply the factor under the Act. The instrument provides the factors "for the purposes of" specified provisions of the Act (s 5; s 7). The practical duty this creates is on the administering Commonwealth authority to use these numbers when applying subsection 8(1) and paragraph 7(3)(b) of the Act. The instrument itself is the formal record of that administrative duty.

• Right of local governments to receive allocations calculated using the factor. The Act defines entitlements and the instrument supplies the factor necessary to quantify those entitlements for the relevant years (s 5; s 7). The instrument therefore operationally secures the right of recipients to have allocations calculated using the specified multipliers.

• Data and methodological transparency duty. By listing the ABS population estimate dates and CPI inputs, and by defining the adjustment multipliers for the special circumstances, the instrument creates a documented trail that duty bearers must follow if they are to show the calculation was performed as specified (s 6 notes; s 8 notes; s 6(4); s 8(4)). That is an administrative transparency duty, not a statutory compliance obligation imposed on councils.

• Rounding rule implementation. The instrument applies the paragraph 8(1)(b) rounding rule and records the adjustment applied (s 6(3); s 8(3)). The duty of the administering authority is therefore to implement this precise rounding step in the calculation.

What the instrument does not do, and therefore what it does not create as duties or rights:

• It does not create conditions on how councils may spend the funds. The instrument is silent on permitted uses, reporting or acquittal requirements.

• It does not create offences, fines, or enforcement regimes: no penalties or sanctions are present in the instrument text. Any compliance and enforcement scheme must be found in the Act or other instruments, not here.

Practical implication for rights and duties: recipients have a right to allocations calculated using these factors, and the Commonwealth authorities have a duty to apply the specified data sources, rounding, and timing adjustments when producing the figures used to make the payments.

This instrument contains no penalty provisions and does not itself create offences. It is a formal numeric determination under the Local Government (Financial Assistance) Act 1995 and records calculations and adjustments; it does not purport to impose fines, sanctions, or regulatory enforcement mechanisms.

Because the instrument operates within the statutory framework of the Local Government (Financial Assistance) Act 1995 (s 3, s 4), any enforcement, compliance or dispute mechanisms that affect recipients or administering authorities would stem from the Act or other instruments made under the Act, not from this determination. The instrument makes no reference to enforcement powers, administrative review rights, appeal processes, or penalties.

Consequences practitioners should note:

• Administrative challenge. If a recipient or state administration disputes the application of the factor, or the Commonwealth’s decision to bring forward payments, the instrument itself provides the documentary record of how the factor was worked out (s 6 and s 8). Any review or challenge would require reference to both this instrument and the enabling Act to identify whether administrative law grounds exist to contest the calculation or timing decision. The instrument does not state appeal routes.

• Fiscal adjustment effects. The most immediate "enforcement" effect is fiscal: bringing forward payments alters cashflows and future entitlements. That is not a legal penalty but a budgetary consequence. The instrument documents the algebraic method used to account for that timing decision, so the only remedy for an affected party would be whatever administrative or judicial remedies exist under the Act or general administrative law, none of which are created by this instrument.

• Transparency obligations. The instrument’s explicit data references and definitions create an administrative audit trail. While not a penalty, a failure by the Commonwealth to follow the stated method would be susceptible to administrative scrutiny on procedural grounds. The instrument itself does not define the remedy for any such procedural breach.

In short, the instrument is a technical, declarative instrument; any penalties or enforcement rights must be located in the Act or other legal instruments, not in this determination. Practitioners should therefore consult the Act for enforcement pathways and remedies if a party wishes to challenge the application or content of these determinations.

This instrument operates as a statutory determination under the Local Government (Financial Assistance) Act 1995 and therefore interacts directly with that Act. The instrument states it is made under that Act (s 3) and that expressions have the same meaning as in the Act (s 4). Specific cross‑references in the instrument identify the interaction points:

• Subsection 8(1) of the Act. The instrument states that the factor for 2024‑25 is determined "for the purposes of subsection 8(1) of the Act" (s 5) and that the estimated factor for 2025‑26 is determined "for the purposes of paragraph 7(3)(b) of the Act" (s 7). The instrument’s calculations explicitly implement the paragraph 8(1)(a) formula and the paragraph 8(1)(b) and (c) adjustments required by the Act (s 6(1); s 8(1)). Therefore the instrument is functionally a subordinate device that supplies numerical parameters to the Act’s allocation formulas.

• Legislation Act 2003, paragraph 13(1)(b). Section 4 notes that expressions have the same meaning as in the Local Government (Financial Assistance) Act 1995 "as in force from time to time,see paragraph 13(1)(b) of the Legislation Act 2003". That reference imposes the established interpretive rule that the instrument should be read in the statutory context of the parent Act and the Legislation Act’s rules about instrument interpretation.

• Statistical and budgetary sources. The instrument uses data published by the Australian Bureau of Statistics and the Department of the Treasury (s 6 notes; s 8 notes). While those are not "laws", the instrument’s reliance on those bodies’ published figures ties its operation to the administrative procedures and publication timetables of ABS and Treasury. Any subsequent revisions by ABS or Treasury do not automatically change the numbers recorded here because the instrument refers to figures as published on specified dates.

Absent from the instrument are references to other Commonwealth acts, regulations, or state laws that might govern how payments are passed through by states to councils. The instrument does not alter or purport to override those arrangements. The interaction is therefore limited: this instrument supplies the factor parameters the Act requires; any downstream legal or policy effect on recipients is mediated through the Act and the states’ own distribution arrangements.

Practitioners should treat this instrument as one link in a statutory chain: the Act prescribes the formula and the legal mechanics for distributions; this instrument supplies the data‑anchored numeric result for the factor; state laws and administrative arrangements determine how the Commonwealth payments are ultimately allocated to and administered by councils. To understand legal rights, obligations, or remedies beyond the numeric determination, consult the Act and any state distribution instruments or agreements.

The instrument records a single enactment and no amendments within its text. It is dated 26 June 2025 and signed by the Assistant Minister for Productivity, Competition, Charities and Treasury (instrument header and signature). The commencement table states the whole instrument commences the day after registration (s 2(1)) and includes the standard note that the table relates only to the instrument as originally made and will not be amended to deal with later amendments of the instrument (s 2 table note). Section 2(2) emphasises that information in column 3 of the table is not part of the instrument and may be edited in published versions without changing the instrument.

There is no recorded history of prior versions, saved amendments, or repeal within the text provided. The instrument does not contain any transitional or saving provisions apart from the timing correction multipliers that reflect the Commonwealth’s pre‑existing decision to bring forward payments (s 6(4); s 8(4)). There are no revocations listed, and no expiring or sunset provisions are included.

Because the instrument is a discrete determination of numeric factors tied to specific years, the usual pathway for change would be the making of a subsequent determination under the same statutory power in a later instrument. The text does not describe or limit future amendments; it simply records the factor calculations for the two years in question.

For users tracking amendments, the instrument itself alerts readers to sources that may change over time: it depends on ABS publications and a Treasury budget CPI forecast (s 6 notes; s 8 notes). Future determinations will likely reference different ABS or Treasury releases and will therefore be captured as new instruments rather than amendments to this one.

Practitioners should therefore treat this instrument as a single, dated administrative determination with no internal amendment record. If a party wishes to see a change to these factors, the avenue would be a new determination under the Act, not amendment of this document.

The instrument contains no references to litigation, judicial determinations, or precedent. It is a technical administrative instrument that records numeric calculations required by statute, and the text does not mention any court proceedings related to these particular factors or the underlying statutory methodology.

Because the instrument is confined to the arithmetic and data used to calculate factors under the Act, any litigation that might implicate its operation would arise under general administrative law principles or out of disputes about application of the Act itself. Those avenues are not described in the instrument. The instrument does not specify any internal review or appeal processes specific to this determination; therefore, any judicial review or challenge would rely on the general legal framework applicable to administrative decisions and the enabling statute.

Practitioners seeking litigation history relevant to factors or to the Local Government (Financial Assistance) Act 1995 more generally must therefore consult court records and decisions, and the text of the Act. This instrument does not supply any case names, judicial findings, or prior litigation chronology.

In short, nothing in the instrument suggests existing litigation concerning these determinations; the document simply records the numeric factors, the data inputs, and the arithmetic and timing adjustments used to arrive at them.

Several practical traps for the unwary are embedded in the instrument’s text and operation. These are mechanical or interpretive risks that practitioners, state administrators and councils should note.

• Timing effect from brought‑forward payments. The instrument adjusts the factors to account for the Commonwealth’s decision to bring forward significant portions of future year payments into earlier years (s 6(4); s 8(4)). That has immediate cashflow benefits for recipients in the earlier years, but the instrument’s multipliers reduce entitlements for later years. The instrument defines the exact percentages brought forward (85 per cent for some 2024‑25 payments into 2023‑24; 50 per cent for some 2025‑26 payments into 2024‑25) and uses those to alter factors. If a council looks only at cash received in a single year without projecting the adjusted entitlement path, it will misread its medium term position.

• Reliance on Act definitions not reproduced here. Section 4 explicitly ties expressions to the Act’s meaning. Terms used in the timing multipliers, such as "base figure" and "final entitlement", are not defined in this instrument but come from the Act. Therefore a practitioner cannot interpret those terms from this instrument alone; they must consult the Act to understand precise legal meanings and how they map to budget items.

• Data snapshot dependence. The paragraph 8(1)(a) calculations are anchored to specific ABS and Treasury publications on specified dates (s 6 notes; s 8 notes). If ABS or Treasury later revise those series or publish updated figures, this instrument will not change: it records a calculation based on the specified snapshots. That creates a divergence risk if other documents or systems use different data snapshots inadvertently.

• Rounding increment is small but binding. The instrument applies a 0.0001 increase where the fifth decimal place exceeded 4 (s 6(3); s 8(3)). For large base figures even a small rounding step can change the dollar outcome materially when multiplied across a national program. Practitioners should not ignore the rounding step.

• Terminology in the commencement table. Section 2(2) states the information in column 3 is not part of the instrument and may be edited in published versions. Users should therefore rely on the formal provisions, not on editorial or explanatory content that may appear in published renditions.

• No operational or spending rules included. The instrument does not provide guidance on how recipients must account for or report use of funds. Councils expecting conditions or acquittals to be recorded here will not find them.

• Instrument does not state procedural remedies. If an affected party believes the factor was calculated incorrectly or that the timing decision was unreasonable, the instrument does not identify an internal review route. Any challenge would therefore require recourse to the Act and general administrative law.

• Label of estimated vs final. The 2024‑25 factor is described as the final factor (s 5) while the 2025‑26 factor is an estimated factor (s 7). Practitioners should not treat the 2025‑26 number as immutable; it is an estimate used for specific statutory purposes and may be adjusted in a later instrument.

• Arithmetic presented in images. The instrument’s numeric formulae appear as images in the text. That creates a modest document handling issue for automated systems or OCR processes that expect plain text. Users relying on data feeds should ensure extraction was accurate.

These "gotchas" are all explicit or directly implied by the instrument’s wording. They are not policy critiques but practical flags for administrators and recipients working with the factors.

Compliance in relation to this instrument is primarily an administrative exercise for Commonwealth officials, state administrators and local governments. The instrument imposes no new reporting duties on recipients, but several concrete steps follow from its content.

For Commonwealth administering agencies and Treasury:

• Apply the factors exactly as stated when calculating allocations under the Local Government (Financial Assistance) Act 1995: use 0.7945 for 2024‑25 (s 5) and 0.7739 as the estimated factor for 2025‑26 (s 7) for the statutory purposes specified.

• Implement the paragraph 8(1)(b) rounding increase of 0.0001 where the fifth decimal exceeded 4, as recorded (s 6(3); s 8(3)). Ensure accounting systems capture this small increment so that aggregate distributions reconcile to the instrumented numbers.

• Apply the paragraph 8(1)(c) timing multipliers as defined to reflect the Commonwealth’s decision to bring forward payments. The instrument provides the algebraic multipliers and defines the terms used (s 6(4); s 8(4)). Use the same definitions for "2023‑24 amount", "2024‑25 amount", "2025‑26 amount", "final entitlement" and the "sub (3) factor" to reproduce the calculations exactly.

• Use the exact data sources and publication dates cited in the instrument when reconstructing or auditing the calculation: the ABS population estimates and CPI numbers and the Treasury CPI forecast dates are all specified (s 6 notes 1-4; s 8 notes 1-4). Record these source documents in the administrative file so that auditors can verify the arithmetic.

For state and territory bodies that pass funds to councils:

• Accept the factor inputs from the Commonwealth as binding for the statutory calculation. Ensure internal allocation formulas that reference the national factor are updated to incorporate the exact numbers and timing adjustments from this instrument.

• Update cashflow planning and budget papers to reflect the timing changes occasioned by the Commonwealth bringing forward payments. The instrument’s multipliers alter entitlements across years; states must plan distribution timetables and any bridging finance accordingly.

• Check that the state-level distribution rules and schedules remain consistent with the adjusted Commonwealth figures. If any discrepancy arises between state distribution mechanisms and the Commonwealth factor-based adjustments, document the reconciliation path.

For local councils (recipients):

• Treat the instrument as the authoritative record of the factors used to compute Commonwealth assistance for 2024‑25 and the estimated factor for 2025‑26. Integrate the expected payment timing and amounts into council budget forecasts, noting that earlier payments received in 2023‑24 or 2024‑25 will reduce nominal entitlements in later years due to the timing adjustments reflected in these factors (s 6(4); s 8(4)).

• Coordinate with state and Commonwealth administrators to confirm actual payment dates and amounts. The instrument documents the methodology but not the payment schedule; recipients should verify actual cashflows with the paying authority.

• Ensure accounting entries reflect the fact that some payments were brought forward from later years. The instrument’s purpose is to adjust the multiplier, but the accounting treatment for recognition of revenue may require councils to follow accounting standards and local government finance rules.

General practical actions for auditors and advisers:

• Reproduce the arithmetic exactly using the ABS and Treasury source documents cited in the instrument, including the dates specified (s 6 notes; s 8 notes). Retain copies of the ABS and Treasury publications referenced so that the calculation can be independently verified.

• Note which terms are sourced to the Act. Where the instrument uses "base figure", "final entitlement", or other Act‑derived terms, consult the Local Government (Financial Assistance) Act 1995 to confirm the legal definition and ensure the applied numbers map correctly to budget line items.

• Monitor for a subsequent instrument. The 2025‑26 factor is expressly an estimate (s 7). If a later determination is made, it may replace or revise the estimated factor. Practitioners should watch the Federal Register of Legislation or relevant Commonwealth notices.

In short, compliance means applying the instrumented numbers exactly, ensuring the rounding and timing multipliers are included, documenting the sources, reconciling payments to the adjusted entitlements, and aligning accounting and budget forecasting to the timing changes the instrument memorialises.