Bills Digest no. 99 2012–13
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WARNING: This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.
Monica Biddington and Leah Ferris
Law and Bills Digest Section
10 April 2013
Contents
Purpose of the Bill
Structure of the Bill
Background
Committee consideration
Major interest groups
Financial implications
Statement of Compatibility with Human Rights
Key issues and provisions
Concluding comments
Date introduced: 10 October 2012
House: House of Representatives
Portfolio: Attorney-General
Commencement: Parts 1 and 8 commence on Royal Assent. Parts 2-7 commence on a day to be fixed by Proclamation or the day after the end of a six month period after the date of Royal Assent, whichever is earliest.
Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill's home page, or through http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation. When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website at http://www.comlaw.gov.au/.
The purpose of the Regulatory Powers (Standard Provisions) Bill 2012 (the Bill) is to prescribe a framework to be used consistently for Commonwealth regulatory schemes that include:
- monitoring and investigation powers
- civil penalty provisions
- infringement notices
- enforceable undertakings and
- injunctions.
Explicitly, this Bill does not empower, prohibit, prescribe or administer any activity, person or administrative matter. Any new Act or Regulation that requires investigation or enforcement powers will be drafted to trigger some, or all, of the relevant provisions in this Bill.[1] Existing Acts will be revised and, if considered necessary, be amended to trigger the relevant provisions in this Bill.
The Bill is divided into eight parts, which outline the standard regulatory powers that a Commonwealth agency may trigger, through another Act or by Regulation.
In particular, the Bill prescribes:
- extensive monitoring and investigation powers (including entry, search and seizure) and associated procedures available to authorised persons (Parts 2 and 3) and
- a framework for civil penalty orders, infringement notices, enforceable undertakings and injunctions to be used by Commonwealth agencies (Parts 4, 5, 6 and 7).
In 2009 the Government formed an Access to Justice Taskforce to examine the federal civil justice system with a view to developing a more strategic approach to access to justice issues. The Taskforce’s report, Strategic Framework for Access to Justice, recommended that the Government commit to developing clearer laws and practical measures to reduce the volume and complexity of legislation.[2] This commitment includes legislating only where necessary and encouraging the evaluation and review of laws to reduce complexity.[3]
In 2011, the Attorney-General’s Department worked with the Office of Parliamentary Counsel to introduce measures to improve the clarity and reduce the complexity of Commonwealth laws.[4] This package included:
-
the
Quick Reference Guide to Developing Clearer Laws[5], which provides a simple overview of key principles, tips and essential points of contact to assist departmental officers involved in developing legislation and
- a scheme which enables drafters and instructing officers to work together to reduce complexity when drafting legislation, and
- the Clearer Laws website which is a central repository for resources, training material and key Government contacts to guide instructing officers in developing clearer laws.[6]
This Bill has emerged as part of the Government’s Clearer Laws Project, emerging from the Access to Justice Taskforce’s report, which has been the policy umbrella for legislation such as the Acts Interpretation Amendment Act 2011, Parliamentary Counsel and Other Legislation Amendment Act 2012, and the Statute Law Revision Act 2012.
The Bill would seem to rely on the power in section 51(xxxix) of the Constitution to deal with matters incidental to the execution of another power vested in the Parliament. According to the evidence given by Mr Richard Glenn, from the Attorney-General’s Department, before the Senate Standing Committee on Legal and Constitutional Affairs:
This Bill will be in exercise of the incidental power like the other laws of general application like the Acts Interpretation Act and the Criminal Code, and those sorts of laws. Its draws its operational power from the power of the substantive act that triggers the provision, but the creation of the framework in this bill is an exercise of the incidental power. We do not think that it is a particularly controversial constitutional proposition and that it is sound.[7]
The Bill is envisaged to be a prompt for agencies seeking to introduce or amend legislation. Further, it is intended that this Bill will reduce the time it might take the Office of Parliamentary Counsel to negotiate drafting issues with the relevant agency. It is a Bill of ‘general application’, designed in part to provide simplification in the statute book.[8]
From a technical perspective, this Bill is difficult to fault. The provisions are logical, clear and have a simplified outline at the beginning of each part to assist a person who may be entirely unfamiliar with monitoring, investigation or enforcement regimes. The Bill is of concern for reasons such as need, the obvious lack of immediate application and the immeasurable practical benefit that this regime may have.
In this context, the Law Council of Australia (LCA) noted in its submission to the Parliamentary Joint Committee on Law Enforcement’s (PJCLE) Inquiry, discussed further below, that the proposed three stage review and roll out of this framework and 'the extent to which there may be problems with existing powers should have preceded the development of the Bill and the results of the review should have been made publicly available.’[9] This issue was also apparent in the Fair Work Ombudsman’s submission to the PJCLE Inquiry where differences and variations between the existing regime under the Fair Work Act 2009 and the regulatory framework outlined in the Bill were highlighted. It would seem that if the Fair Work regime were to be standardised to for the sake of consistency, any ‘removal of a number of current powers and penalties may significantly impede the Fair Work Ombudsman’s ability to regulate the national workplace relations system’.[10]
The LCA accurately noted that ‘that the powers contained in the Bill cannot be evaluated in isolation from the Acts, Bills or Regulations governing the regulatory agencies that are likely to make use of them’.[11] Instead then, debate about the Bill should focus on the effectiveness of streamlining regulatory powers across Commonwealth law.
The Bill was initially referred to both the Senate Standing Committee on Legal and Constitutional Affairs (the Senate Committee) and the Parliamentary Joint Committee on Law Enforcement (PJCLE) for inquiry and report.[12] The Senate Committee considered that it would be better not to duplicate the work of the PJCLE and ‘resolved that it will not call for submissions or conduct its own inquiry in relation to the Bill.’[13]
On 26 November 2012, the PJCLE reported that consideration of the Bill’s possible constitutional issues would be better dealt with by the Senate Committee[14] and consequently the Bill was referred back to the Senate Committee and the report was tabled on 18 March 2013.[15] In his evidence before the Senate Committee, Mr Glenn was asked about the basis of such constitutional issues. He commented that:
The proposition [of such issues] was not put to us in the course of the hearing and I do not recall seeing anything in a submission about it, at least not with argument associated as to why there might be a problem.[16]
The Committee’s key recommendation was that the Bill be amended to remove the power to trigger the provisions of the Bill by Regulation. Further, the Committee recommended that the Explanatory Memorandum make it clear that each time a Bill is introduced that provides for the triggering of the provisions in this Bill, this must be ‘explicitly articulated and explained in the Explanatory Memorandum to the relevant Bill.’[17] The key recommendation was based on evidence presented by the Law Council of Australia that:
Triggering the Bill’s provisions by regulation may dilute parliamentary scrutiny of precisely what powers are available to an agency in a specific regulatory context, and limit the opportunity for meaningful discussion about whether those powers are appropriate in the circumstances.[18]
The Law Council of Australia (LCA) made a submission to the PJCLE’s inquiry into the Bill. Noting the constraints of a lack of time to consider the Bill, the submission still raised insightful and key points of concern:
The powers contained in the Bill are said to be based on the standard monitoring and investigative powers already available to regulatory agencies responsible for compliance activities. However neither the Explanatory Memorandum nor the Second Reading speech provides any examples of the types of regulatory agencies that have similar powers, or that have identified a need for the standard range of powers.[19]
At a public hearing in February 2013, the LCA said that while it neither supported nor opposed the Bill, it raised strong concerns that there may be ‘insufficient parliamentary scrutiny of the circumstances in which the bill’s provisions are triggered’.[20] Further:
the Bill may result in increasing the availability and use of coercive powers overall. While this is clearly not the policy intention, the Law Council notes that some submissions from agencies regarding the bill seem to indicate their openness to the possibility of new or expanded powers but resistance to any perceived diminution of their current powers. This potential for overall bracket creep is exacerbated by the problems associated with the lack of parliamentary scrutiny already discussed.[21]
The Australian Law Reform Commission made a submission to the PJCLE’s inquiry into the Bill and referred to its 2003 report, Principled Regulation: Federal Civil and Administrative Penalties in Australia[22], which recommended greater consistency in Commonwealth penalties.[23] This report, as well as its significant implementation in the Attorney-General’s Department’s Guide to Framing Commonwealth Offences, Civil Penalties and Enforcement Powers[24], has influenced the drafting of this Bill.
There is no immediate financial impact associated with this Bill. However, the Explanatory Memorandum notes that once enacted, drafting and scrutiny time will be reduced.[25] In that light, this Bill might be regarded as an efficiency measure which may result in cost savings for the Government.
As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible[26], yet also somewhat contradictorily notes that the Bill ‘does not engage any limitation on human rights until the Bill’s provisions are activated’.[27]
The Bill is closely based on the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers.[28] The Guide and this Act, if enacted, will coexist to assist agencies working with the Office of Parliamentary Counsel (OPC) to draft clear and consistent legislative provisions. The Bill, once enacted, will reduce the size of legislation in which provisions dealing with investigation, monitoring, civil penalty provisions, infringement notices, enforceable undertakings and injunctions are included. For future Bills, it is proposed that this framework will significantly reduce the time and resources needed within the Commonwealth to produce those Bills.[29] Also, if enacted, the Bill would ensure that functions and powers that are frequently used by regulatory agencies are carried out under uniform provisions.[30]
The Attorney-General’s Department has stated that the aim of the Bill is to encourage consistency in enforcement regimes, noting difficulties if the same activity is expressed differently in two head statutes.[31] Once enacted, the provisions will result in core provisions in the head statute not being constantly reworked in discussions between agencies. This argument is not particularly convincing as it suggests that this Bill is an administrative convenience to ‘hopefully lose pages from the statute book’.[32]
In an attempt to compare and contrast existing regimes with what is proposed by this Bill, the LCA considered the Great Barrier Reef Marine Park Act 1975 (GBRMPA) and the Fisheries Management Act 1991 in an attachment to its submission to the Senate Committee inquiry. The LCA sought to illustrate how the Bill might work in practice and concluded that it would be a:
complex exercise to reconcile [this Bill and the GBRMPA]. This is particularly the case given that the GBRMPA is already supplemented by, and must be read together with, the Environment Protection and Biodiversity Conservation Act 1999. … [U]nless amendments are made incorporating only peripheral aspects of the Bill, any attempt to prescribe the agency’s regulatory powers primarily by reference to the Bill will result in a substantial review workload and possible procedural and operational changes.[33]
Similarly with the Fisheries Management Act 1991, the LCA noted that ‘rather than resulting in the streamlining of legislation, the Bill may simply complicate current legislative frameworks, with large parts of the regulatory power provisions in existing legislation necessarily preserved’.[34]
Nonetheless, if the Bill is accepted as a drafting tool that is not rigidly applied to regulatory regimes that are already efficient and appropriate, it will reduce the drafting and scrutiny times for Government departments.
General provisions
Part 1 of the Bill includes the following clauses:
- clause 3, which sets out a simplified outline of the Bill that includes the requirement that the provisions of the Bill (when enacted) must be triggered by another Act or Regulation
- clause 4, which provides for a dictionary of terms and
- clause 5, which clarifies that breaching any of the obligations set out in a triggering Act or Regulation will constitute a criminal offence or will give rise to a civil remedy provision.
Part 8 of the Bill gives the Governor-General the standard power to make Regulations under an Act.[35]
Monitoring and investigation powers
Parts 2 and 3 of the Bill set out the various monitoring and investigation powers prescribed under the Act.
Part 2 of the Bill sets out provisions allowing for an authorised officer to monitor whether a person or organisation is complying with the relevant legislation and whether the information that has been provided by the person or organisation is correct. Part 3 provides for a range of investigation powers that an authorised person may utilise while attempting to gather material relating to a suspected breach of a prescribed offence or civil penalty provision.
Some examples of Commonwealth legislation that use monitoring powers are the Clean Energy Act 2011 (section 233); Customs Act 1901 (section 214AE); Migration Act 1958 (section 268CI); Gene Technology Act 2000 (section 153).
Some examples of Commonwealth legislation that use investigation powers are the National Gambling Reform Act 2012 (section 126); Illegal Logging Prohibition Act 2012 (section 31); Greenhouse and Energy Minimum Standards Act 2012 (section 95).
Civil penalty provisions
Part 4 of the Bill creates a framework for civil penalties in Commonwealth law. Where a person has contravened a civil penalty provision, the court will have the authority to issue a civil penalty order. It is possible to have both a criminal penalty, that is, a term of imprisonment as well as a civil penalty, available for the same conduct. In such offences, the fault elements (knowledge, recklessness, intention) are clearly distinguishable so that the more appropriate penalty can be applied.
Division 1 of Part 4 sets out the purpose of Part 4 and how it will operate.[36] Specifically, clause 80 of the Bill defines what is a civil penalty provision, in any Act or Regulation.
Division 2 of Part 4 details the process involved in obtaining a civil penalty order. Subclause 85(1) provides that an authorised applicant may apply to the relevant court for an order that a person, who is alleged to have breached a triggering Act or Regulation’s civil penalty provisions, pay the Commonwealth a pecuniary penalty. Under subclause 85(3), where the relevant court is satisfied that the person has breached the civil penalty provision, the court may order to person to pay a pecuniary penalty.[37] The amount of the penalty is for the court to determine, upon taking into account all relevant factors, including those prescribed under subclause 85(6), though subclause 85(5) sets out maximum penalties that a court may order the person to pay. Clause 86 clarifies that a pecuniary penalty is a debt payable to the Commonwealth and that the Commonwealth has the power to enforce such a debt.
Division 3 of the Bill provides for the situation where concurrent criminal and civil proceedings have arisen out of the same conduct without subjecting a person to a situation of double jeopardy. A court cannot issue a civil penalty order against a person who has previously been convicted of a criminal offence in relation to the same conduct (clause 91). Clauses 91-93 outline when civil penalty orders can be made, whether during or subsequent to criminal proceedings and vice versa, where criminal proceedings can commence after civil proceedings. These are important procedural provisions that commonly arise in prosecutions and causes of action.
Clause 94 prevents evidence given in civil proceedings from being admitted in criminal proceedings, except where a person has been charged with giving false evidence in the proceedings for the civil penalty order.
Division 4 of Part 4 sets out various provisions that relate to civil penalty provisions. Clause 95 provides that even where a person has not directly contravened the civil penalty provisions, they will still be considered to have breached the provisions in certain circumstances. Therefore any attempt to contravene a provision that does not succeed, aiding or inducing a contravention of a civil penalty provision, and any conspiracy to contravene a civil penalty provision, will be considered to be a breach of a civil penalty provision.[38] Clause 96 sets out the circumstances where certain actions will be considered to be repeated contraventions of a civil penalty provision. Under clause 97, in proceedings for a civil penalty order against a person, it is not necessary to consider the person’s state of mind. This means that neither the intent nor state of mind of the person, or the presence or absence of knowledge, recklessness or negligence is relevant in determining whether the person breached a civil penalty provision.[39] However, clause 98 provides that a person will not be liable for a civil penalty order where there has been an honest mistake of fact.
Civil penalty provisions operate across most areas of Commonwealth law.
Infringement notices
Part 5 of the Bill allows for the use of infringement notices in certain circumstances. A well-versed description of infringement notices is set out in the Explanatory Memorandum:
An infringement notice is a notice of a pecuniary penalty imposed on a person by statute setting out particulars of an alleged offence…Infringement notices are administrative methods for dealing with certain breaches of the law and are typically used for low-level offences and where a high volume of uncontested contraventions is likely.[40]
Clause 107 of the Bill provides for when an infringement notice may be given. In particular, subclause 107(1) of the Bill states where an infringement officer has reasonable grounds to believe that a person has contravened an offence of strict liability or a civil penalty provision, which is subject to an infringement notice under Part 5 of the Bill, the infringement officer can issue an infringement notice. Clause 108 sets out a number of details that must be included in an infringement notice, including the person to whom the notice is directed, the time and method of payment and the consequences of non-compliance with the notice.
Under clause 111, a person who has received an infringement notice can elect to pay the amount specified in the notice and will therefore be discharged from all liability for the offence the subject of the notice, without having to go to court. Payment of the amount does not constitute an admission of fault. Clause 110 allows a person to challenge an infringement notice and in the event they are successful, then the notice will be withdrawn.[41] Where a person has already paid the amount, and then subsequently been successful in having the notice withdrawn, the amount must then be refunded. [42] Subclause 111(2) provides that where a notice has been withdrawn, the person is not considered to be discharged from liability under subclause 111(1). According to the Explanatory Memorandum, ‘withdrawing a notice acts as if the notice was never issued’, meaning there is no need for the person’s liability to be discharged.[43]
However, where the notice is subsequently withdrawn, a person’s liability for the alleged contravention that was the subject of the notice will not be considered to have been discharged.[44]
Enforceable undertakings
Under Part 6 of the Bill, a framework is established for the use of enforceable undertakings. Where a person has breached an offence provision or civil penalty provision that is enforceable under Part 6, the enforcement body may choose to have the matter dealt by way of an enforceable undertaking. This is a legal agreement where the person undertakes to either perform, or refrain, from a particular action in exchange for avoiding, or minimising, the disciplinary action required to be taken against them. Subclause 119(1) of the Bill allows for an authorised person to accept such an undertaking. Under subclause 119(3) of the Bill, the person who gives the undertaking may vary or withdrawal it on the condition that they have the authorised person’s consent.[45] Clause 120 allows for the relevant undertaking to be enforced by the court, and sets out the remedies which a court may provide where an undertaking has been breached.[46]
Examples where enforceable undertakings operate in current Commonwealth legislation include Banking Act 1959 (section 18A), Fair Work Act 2009 (section 715), Life Insurance Act 1995 (section 133A), Telecommunications Act 1997 (Part 31A).
Injunctions
Part 7 of the Bill allows for the use of injunctions when enforcing provisions. An injunction is ‘an order of a court that stops a person from doing, or demands that a person do a particular action’.[47] Injunctions may be used to enforce both offence provisions and civil penalty provisions.
Under clause 127 of the Bill, the court has the power to grant an injunction to either restrain a person from engaging in a particular type of conduct (restraining injunction), or order that a person engage in a particular type of conduct (performance injunction). The court will only grant an injunction where an application has been submitted by an authorised person and the court is satisfied that it is either desirable to grant such an injunction, or that a refusal or failure to do so would result in a contravention of an enforceable provision. Clause 128 allows for an interim injunction to be granted, while the court is hearing the original application for an injunction and there is need to either compel or restrain a person from engaging in particular conduct. Pursuant to clause 129, the court has the power to discharge or vary an injunction that has been granted, while clause 130 allows the court to issue an injunction to compel or restrain a person from engaging in particular conduct regardless of whether or not that specific conduct is occurring, has occurred in the past, or is likely to give rise to damages.[48]
Theoretically, this Bill is sound in its aims to streamline the drafting of regulatory powers at the Commonwealth level. However, it is possible that the Bill may have the unintended consequences of greater complexity and confusion as agencies attempt to reconcile the requirements to streamline legislation with their existing operational requirements. Combined with continuing budget restraints on the public service and the Government being light on the details of the three stage rollout of the Bill, the Bill’s usefulness will not be able to be judged for some time.
Members, Senators and Parliamentary staff can obtain further information from the Parliamentary Library on (02) 6277 2500.
[2]. Explicitly, recommendation 6.9 of the report stated: ‘To ensure that legislation is relevant, clear, effective and not redundant, the Government should introduce a flexible scheme for the regular review of primary legislation’. Attorney-General’s Department (AGD), A Strategic framework for access to justice in the federal civil justice system, report prepared by the Access to Justice Taskforce, September 2009, p. 86, viewed 29 January 2013, http://www.ag.gov.au/LegalSystem/Documents/A%20Strategic%20Framework%20for%20Access%20to%20Justice%20in%20the%20Federal%20Civil%20Justice%20System.pdf
[11] Law Council of Australia, Submission to the Parliamentary Joint Committee on Law Enforcement, op. cit. p. 3.
[12]. The referrals were both made on 11 October 2012; A Burke, ‘House of Representatives Committees: Selection Committee Report’, House of Representatives, Debates, 11 October 2012, p. 12 109, viewed 20 October 2012, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22chamber%2Fhansardr%2F326c1d2a-eacb-4d75-8dfe-810eeaf66e7c%2F0204%22 ; Senate Selection of Bills Committee, Report No. 13 of 2012, 11 October 2012, viewed 26 March 2013, http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=selectionbills_ctte/reports/2012.htm
[16]. R Glenn (Attorney-General’s Department), Public Hearing of the Legal and Constitutional Affairs Legislation Committee, op. cit., p. 6.
[19] Law Council of Australia, Submission to the Parliamentary Joint Committee on Law Enforcement, op. cit., p. 2.
[22]. Australian Law Reform Commission (ALRC), Principled regulation: federal civil and administrative penalties in Australia, ALRC, report no. 95, 13 March 2003 (last modified 19 July 2012), viewed 12 March 2013, http://www.alrc.gov.au/report-95
[25]. Explanatory Memorandum, op. cit., p. 1.
[28]. Attorney-General’s Department, A guide to framing Commonwealth offences, infringement notices and enforcement powers, op. cit.
[29]. N Roxon, ‘Second reading speech: Regulatory Powers (Standard Provisions) Bill 2012’, op. cit., p. 11 768.
[30]. Uniformity is not always appropriate, such as in the case of national security provisions or taxation provisions. It will be left to each agency to decide on the appropriateness and extent to which compliance with the new framework can be achieved.
[32] R Glenn (Attorney-General’s Department), Public Hearing of the Legal and Constitutional Affairs Legislation Committee, op. cit., p. 8.
[35]. Clause 132 provides that the Governor-General may make Regulations.
[36]. With regards to the operation of Part 4 of the Bill, the Explanatory Memorandum states at paragraph 124 that ‘clause 79 provides a simplified outline of Part 8 of the Bill, which governs enforcement of the Bill by way of civil and criminal proceedings, infringement notices, publicising contraventions, enforceable undertakings, and injunctions.’ This does not appear to be the case. Clause 78 actually provides for a simplified outline of Part 4 of the Bill, which states that this part is concerned with civil penalty provisions.
[37]. Clauses 87-89 of the Bill provide for where a person’s conduct has constituted two or more civil penalty provisions.
[38]. Explanatory Memorandum, op. cit., p. 26.
[39]. Clause 97 does not apply to breaches that arise out of a contravention of clause 95 (see note to clause 95).
[40]. Explanatory Memorandum, op. cit., p. 29.
[41]. Subclause 110(2) of the Bill.
[42]. Subclause 110(5) of the Bill.
[43]. Explanatory Memorandum, op. cit., p. 30.
[44]. Subclause 111(2) of the Bill.
[45]. Under subclause 119(5) of the Bill, the authorised person may cancel the undertaking by giving written notice to the other party.
[46]. Under subclause 120(2) a court can make the following orders: an order directing compliance, an order requiring any financial benefit from the failure to comply to be surrendered, an order for damages or any other order that the court considers appropriate.
[47]. PH Butt and D Hamer, eds., LexisNexis concise Australian legal dictionary, fourth edn, LexisNexis Butterworths, Chatswood, 2011, p. 305.
[48]. Explanatory Memorandum, op. cit., pp. 33–34.
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