Commonwealth act

New Guinea Loan Guarantee Act 1938

RepealedCTH

This Act has been repealed and is no longer in force. It is retained for historical reference.

Jurisdiction

Commonwealth

Act Number

16 of 1938

Collection

act

Plain English Summary

2/10 complexity

This Act allows the Australian Government to act as a guarantor for a loan taken out by the Administrator of New Guinea (then an Australian-administered territory) to build a specific road.

Key points:

The Commonwealth guarantees repayment of a loan up to £150,000 (roughly $15-20 million in today's values)
The money must be used to build a road between Salamaua and Wau in New Guinea
The Treasurer must approve the timing and terms of the loan
If New Guinea cannot repay, Australian taxpayers foot the bill via the Consolidated Revenue Fund (the government's main bank account)

Why this matters: By providing a government guarantee, the loan becomes less risky for lenders, meaning the territory can borrow money at lower interest rates to build critical infrastructure. This is essentially the Commonwealth backing its territory's credit card for a specific infrastructure project.

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Current sections

Direct links to the current provisions in New Guinea Loan Guarantee Act 1938.

New Guinea Loan Guarantee Act 1938

NEW GUINEA LOAN GUARANTEE.

No. 16 of 1938.

An Act to provide a Guarantee by the Commonwealth in respect of a Loan to be raised by the Administrator of the Territory of New Guinea to meet the Cost of certain Road Construction.

[Assented to 5th July, 1938.]

[Date of commencement, 2nd August, 1938.]

BE it enacted by the King’s Most Excellent Majesty, the Senate, and the House of Representatives of the Commonwealth of Australia, as follows.—

Short title.

This Act may be cited as the New Guinea Loan Guarantee Act 1938.

Guarantee of loan raised by Administrator of New Guinea.

2.—(1.) Subject to this section, the Commonwealth hereby guarantees the repayment of, and the payment of interest upon, a loan not exceeding One hundred and fifty thousand pounds to be raised by the Administrator of the Territory of New Guinea acting under the authority of a law in force in the Territory.

(2.) The last preceding sub-section shall not apply unless—

(a) the loan is raised at such time and in accordance with such terms and conditions as are approved by the Treasurer; and

(b) the loan is raised for the purposes of, and the proceeds of the loan are applied to, the construction of a road between Salamaua and Wau in the Territory of New Guinea.

Appropriation.

The Consolidated Revenue Fund is hereby appropriated to the extent necessary to meet any liability of the Commonwealth arising from the guarantee provided by this Act.

Source text

Sourced from the Federal Register of Legislation (legislation.gov.au), CC BY 4.0.

1 New Guinea Loan Guarantee Act 1938