Cost Recovery Impact Statement

Background

In 2002 the Government issued Commonwealth Cost Recovery Guidelines for Information and Regulatory Agencies. The Guidelines apply to all Commonwealth Financial Management Act and Commonwealth Authority and Companies Act entities and were developed to assist agencies with implementation of a new cost recovery policy.

Under the Guidelines, agencies are required to review their user charging arrangements and those with significant cost recovery arrangements are required to prepare a Cost Recovery Impact Statement. The National Library has been listed as an agency with significant cost recovery arrangements and was scheduled for a review in the 2004-05 financial year.

The vast majority of the Library’s revenue relates to inter government payments or commercial charging arrangements that are exempt for the purposes of the policy. Nonetheless, the Library has adopted the broader principles within the guidelines and has prepared this Cost Recovery Impact Statement. It is not intended to produce any Cost Recovery Impact Statements in the future.

Prior to this review the Library had in place a user charging policy. Revenue of some $7.4m per annum resulted from these charges.

Functions of the National Library of Australia

T he National Library of Australia (NLA) is a statutory authority established under the National Library Act 1960. Under the Act, the functions of the Library are, on behalf of the Commonwealth:

(a) To maintain and develop a national collection of library material, including a comprehensive collection of library material relating to Australia and the Australian people;

(b) To make library material in the national collection available to such persons and institutions, and in such manner and subject to such conditions, as the Council determines with a view to the most advantageous use of that collection in the national interest;

(c) To make available such other services in relation to library matters and library material (including bibliographical services) as the Council thinks fit, and in particular, services for the purposes of ‑

(i) the library of the Parliament;

(ii) the Departments and authorities of the Commonwealth; and

  • the Territories; and

(d) To co‑operate in library matters (including the advancement of library science) with authorities or persons, whether in Australia or elsewhere, concerned with library matters.

  • Services and products to be covered by user charging

The maintenance and development of the national collection and co‑operation in library matters as set out in (a) and (d) above are seen as community service type obligations or basic activities for which there will be no charges. Similarly, in respect of (b) and (c) above, the services that help inform the general public of the National Library’s collections and services will generally be provided free of charge. These include

  • Services that inform the general public of the Library’s collections and services:
    • Public access catalogues
    • Reference services
    • Visitor orientation
    • Web-site information
    • Education programs
  • Access to collections:
    • On-site access to collection materials
    • Access to categories of digital content via the Internet
    • Entry to exhibitions (on-site and travelling)
    • Public events (e.g. film screenings and musical performances)
    • Permission to publish collection items
  • Services to facilitate bibliographic control of Australian publications:
    • Cataloguing-in-Publication
    • ISSN assignment
    • ISMN assignment

The products and services provided by the Library to which user charging will apply can be categorised as follows:

  • Copying and offsite borrowing of Library collections
  • Commercial operations (e.g. bookshop, restaurant and venue hire)
  • Some basic products or services that also have additional value added benefits and these include some co-operative arrangements with inter-government partners.

Mechanisms for monitoring the effectiveness and efficiency of the cost recovery arrangements

Excluding cost recovery for the Kinetica service, all other cost recovery arrangements are relatively minor in nature. Some of these service charges are set as standard charges by agreement within the Australian library sector (e.g. interlibrary loan and document delivery).

The Kinetica service is an internet based service available to libraries, their users and individuals. The system supports searching of the Australian National Bibliographic Database which records approximately 38 million items held by Australian libraries and many international databases. The service:

  • Enables collaboration between Australian libraries
  • Supports resource discovery of Australian library collections
  • Supports sharing of resources (through an interlibrary lending management and payment system)
  • Supports collaborative collection building.

An Advisory Committee representing all sectors in the library industry provides advice on strategic and policy issues affecting the Kinetica service including charges, the broad direction of service development, changes occurring in the library community which are likely to affect services and communication to representative bodies on developments in the Kinetica service.

The Library Council will oversight all charging arrangements for the Library, with actual charges to be reviewed on an annual basis and the overall policy to be reviewed every five years or earlier should circumstances require.


Use of fees or levies and who should be charged

As it is easy to identify the beneficiaries of the products and services for which charges are to apply and the cost of providing these, fees are charged directly to the specific individual or organization.

Legal requirements for imposition of the charges

Section 7 (1) of the Act gives the Library the “power to do all things necessary or convenient to be done for or in connection with the performance of its functions.” Legal advice has been obtained verifying the validity of applying charges for these products.

Which Costs should be included and the calculation of these

The products and services for which charges apply and the charging basis for these are set out in the Attachment. The types of charges to apply are determined as follows:

  • Commercial Products – these are products which the private sector could also provide.
  • Incrementally costed products – these are products which provide additional support beyond our basic products and services
  • Marginally costed services – these involve further disemmination of our basic products and services. In some instances an additionalfee may be charged for premium (eg fast track) services.
  • Below marginally costed services – these involve a combination of a community service and or leadership type obligations or our basic product set and offer some additional services.

Virtually all revenue received through below marginally costed charges relates to inter-government services and this represents a very small proportion of overall revenue. These services include assisting other organisations in providing public on line access to their digitised picture collections, making available National Library collection material to other organisations for exhibition display purposes, and providing administrative support to a consortium of Australian State , Territory and National libraries which was formed for the purpose of acquiring access to commercial electronic information resources.

The fees are calculated using an internally designed template established to capture the estimated costs of providing the products or services. The costs and fees are reviewed annually and are subject to a test of reasonableness as part of a process to help ensure that the fees are equitable and that the products and services are delivered efficiently.


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