1.3.6 Act of Grace Payments

What is an act of grace payment?

An act of grace payment is a special 'gift of money' by the Commonwealth akin to the historical Royal Prerogative for 'grace and favour payments'. They are payments that fall outside statutory entitlements.

Generally, act of grace payments are a means of providing compensation to persons who may have been unfairly disadvantaged by the Commonwealth but who have no legal claim against it.

When is an act of grace payment made?

An act of grace payment can ONLY be made in those cases that involve:

• the consideration of purely moral or humanitarian grounds, OR
• questions of legislation producing unintended, anomalous, inequitable, unjust or otherwise unacceptable results in the particular circumstances, OR
• a matter not covered by legislation but where it is intended to introduce such legislation and it is desirable to apply the benefits of the proposed legislation prospectively.

When can an act of grace payment NOT be made?

An act of grace payment CANNOT be made if the:

• case relates to defective administration, OR
• matter CAN be justly or legally considered under any enactment.

Example: Any case that can be settled under FMAA Regulation 9 CANNOT be paid as an act of grace payment.

For further explanation of this topic, refer to the Guidelines for Customer Compensation.

Act reference: Financial Management and Accountability Act 1997, refer to Regulation 9

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Last reviewed: 3 January 2006