1 1 1 [ideas clarity results] effective use of new service funding agreements demystifying the...

1 [ideas clarity results]

Effective Use of New Service Funding Effective Use of New Service Funding

AgreementsAgreements

Demystifying the Demystifying the standard agreementstandard agreement

Dr Nick Seddon Special Counsel,

Blake Dawson Waldron


The agreement - what is it?

Legally, probably a contract Case law that indicates that these types

of agreements are not contracts But case law is probably out of date The government certainly wants this to

be a contract


What is a contract?

A legally enforceable agreement Therefore the funding agreement is

legally enforceable


Legal enforceability - what does that mean?

Ultimately, either party can enforce in a court Enforcement is problematic with this type of

contract Usual remedies are not very appropriate eg.

damages Lack of enforceability explains why agreement

is somewhat prescriptive


Self-enforcing remedies (ie. not court enforced)

Most obviously, government can withdraw funding/terminate

Lesser measures are included such as dispute resolution


Nature of contract

Obviously very different from commercial contract

Not a zero-sum game like many commercial contracts

Co-operative and work-together ethic in Background


The important bits

Clause 2 - duration - is important for funding security

The services - what the organisation has to do

The funding - what the organisation gets to do it


Duration

Probably a matter of policy but obviously the longer the better from organisation’s perspective eg recent move to triennial funding


What the organisation has to do

Combination of cls 3 (services), 5 (various), Sched 2 (services), Sched 3 (reports)

Plus some other bits and pieces eg insurance in cl 5.3 and Sched 6


How is performance measured?

Quality of human services very difficult to measure but remember cl 5.6 (User Satisfaction)

Outcomes (item 2 of Sched 2) often very difficult to state

Outputs (item 3 of Sched 2) easier to state but may not be a significant indicator of performance (eg people through the door)



Performance indicators (item 4 of Sched 2) - how different from outcomes or outputs?

How are performance requirements (item 5 of Sched 2) and quality standards (item 6 of Sched 2) measured and how are they different from items 2-4?



It is very important to pin these things down so as to avoid potential disagreement later

If they cannot be pinned down then omit them

No point in setting standards that cannot be met or cannot be measured


Routine obligations

Meeting various accountability obligations is demanding

For example, reporting requirements Diverts resources from main task Nevertheless, must be done


Routine obligations

These are measures that can be assessed by the government

Therefore get them right e.g use Outlook or wall planner

During negotiation process, be absolutely clear about what is required

If in doubt discuss and, if necessary, confirm in writing


Specific clauses - the indemnity (cl 5.4) Could look worrying but very low risk It is about the organisation doing something

that exposes the Territory to a loss or a claim - organisation must indemnify the Territory

Either insure (if reasonably available) or go bare (with very small risk of going into liquidation)


Specific clauses - conflict of interest (cl 7)

It is not the end of the world to have a conflict

The important point is disclosure (if in doubt - disclose)

The conflict may then be managed May require no action so long as everyone

aware


Specific clauses - intellectual property (cl 9)

Could look worrying for organisation But will rarely be a problem Both parties are in effect non-profit

bodies If there is a potential problem, then

negotiate


Assets - what’s covered?

Territory assets listed in Sched 5 if not listed, item worth >$3000 and

bought/hired wholly or partly with the Funds

doesn’t cover the microwave or the kettle!


Assets - what obligations?

obligations in Sched 5 eg. maintenance and insurance

money used to purchase may have to be returned if termination of agreement (cl 11)

asset may have to be returned if not passed on to another organisation (cl 11)


Access to premises

Territory’s right to enter premises (cl 5.1)

must be written notice, reasonable period and reasons given

cannot access private information can ask for specific gender of person

doing inspection


Provision of information

Territory’s right to information (cls 5.7 and 6.4)

Request must be in writing Must give reasonable time for

compliance


Treatment of information by organisation

clause 8 looks long and complicated confidential and personal information

must not be disclosed mostly common sense (if in doubt, don’t

disclose) chatting to a friend about a client is

disclosure even if you trust the friend


Dispute resolution, stopping funds and termination

obviously try to sort out difficulty first stopping funds or termination of

agreement absolute last resort


Any questions?

1 1 1 [ideas clarity results] effective use of new service funding agreements demystifying the...

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