The Medical Research Future Fund Bill has been passed today in Canberra.

The successful passage of the legislation to establish the Government’s Medical Research Future Fund will significantly strengthen Australia’s standing as one of the global leaders in the field of medical research, say Treasurer Joe Hockey, Minister for Finance Mathias Cormann and Minister for Health Sussan Ley.

The Fund, the largest of its kind in the world, will support research that enables game-changing medical innovations and improves the health of Australians, they say in a joint statement.

The Medical Research Future Fund will provide stability and predictability in funding for medical research and innovation into the future, with the capital of the Fund preserved in perpetuity.

The Fund will receive an initial contribution of $1 billion from the uncommitted balance of the Health and Hospitals Fund and will eventually provide around $1 billion per annum in additional funding for medical research and medical innovation.

The remaining contributions into the Fund will come from 2014-15 Budget savings in the health portfolio which have passed, or will pass through the Parliament in the future, until the balance in the Fund reaches $20 billion.

The first $10 million in additional medical research funding will be distributed in 2015-16 and over $400 million is estimated for distribution over the next four years.

The Government has ensured that the Medical Research Future Fund meets the needs of the medical research community, the Ministers say. Amendments made to the Bill incorporate recommendations from the Community Affairs Legislation Committee inquiry into the Bills.

“We have also responded to a number of constructive suggestions made by the Australian Greens and thank them for their support in helping us secure the successful passage of this very important initiative,” they say.

The Medical Research Future Fund will be administered by an independent expert advisory board. The advisory board will consist of eight members with expertise across medical research and innovation, health policy, commercialisation, experience and knowledge in philanthropy and in consumer issues and translation of research into applications in front-line medical practice.

The CEO of the NHMRC will have a permanent seat on the advisory board to support coordination of approaches.

Members of the advisory board will be announced shortly by the Minister for Health.

For transparency, the Minister for Health will also be required by law to report to the Parliament once every two years on how research funded by the Medical Research Future Fund meets the strategy and priorities that are independently set by the board.

The reports from the Minister for Health will also outline the spending profile for the Medical Research Future Fund compares against other sources of Commonwealth funding on medical research and innovation, to demonstrate that the Medical Research Future Fund builds upon existing funding.

The Medical Research Future Fund will be established following Royal Assent of the Bill.