Bills Digest no. 126 2014–15
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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.
Joshua Wrest
Law and Bills Digest Section
18 June 2015
Contents
Purpose
of the Bill
Structure of the Bill
Background
Committee consideration
Policy position of non-government parties/independents
Position of major interest groups
Financial implications
Statement of Compatibility with Human Rights
Key issues and provisions
Concluding comments
Date introduced: 27
May 2015
House: House of
Representatives
Portfolio: Attorney-General
Commencement: Sections
1 to 3 commence on Royal Assent. Schedule 1 will commence on 31 July 2015.
Links: The links to the Bill,
its Explanatory Memorandum and second reading speech can be found on the
Bill’s home page, or through the Australian
Parliament website.
When Bills have been passed and have received Royal Assent, they
become Acts, which can be found at the ComLaw
website.
The purpose of the Crimes Legislation Amendment (Penalty
Unit) Bill 2015 (the Bill) is to amend the Crimes Act 1914 (the Act)[1]
by increasing the amount of the penalty unit for Commonwealth criminal offences
and allowing for the penalty unit amount to be automatically adjusted with
inflation every three years.
The Bill contains one schedule which amends the provision
that sets out the Commonwealth penalty unit.
The Bill is the latest in a series of legislative changes
to the Commonwealth’s penalty unit for criminal offences.
The Crimes Legislation Amendment Act 1992 first
introduced the Commonwealth penalty unit.[2]
The introduction of a penalty unit was based on the recommendations from the Review
of Commonwealth Criminal Law (the Review) in 1991. [3]
The Review recommended that Commonwealth penalties which utilised a dollar
amount be replaced with a penalty unit system in relation to fines, as ‘the
erosion of the value of money sooner or later causes the amount specified to be
unrealistic’.[4]
At that time, Victoria, New South Wales and Queensland had already implemented
a penalty unit system.[5]
The penalty unit was initially set at $100.[6]
The first increase to the amount of the penalty unit after
its introduction occurred with the passing of the Crimes and Other
Legislation Amendment Act 1997.[7]
This Act amended the penalty unit amount from $100 to $110. The increase corresponded
with the Consumer Price Index (CPI) increase of 9.6 per cent from June 1992 to
September 1995.[8]
In 2012, the Crimes Legislation Amendment (Serious Drugs,
Identity Crime and Other Measures) Act 2012 increased the penalty unit from
$110 to $170.[9]
This adjustment to the Act also introduced a regular review of the penalty unit
every three years to accommodate changes to the CPI.[10]
At the time of the Bill’s introduction, it was estimated that the $60 increase
would generate an additional $185.0 million in consolidated revenue for the
Commonwealth over the forward estimates period.[11]
The amendment proposed in the Bill will implement a budget
measure that seeks to increase the Commonwealth penalty unit from $170 to $180.
The Government has stated that the $10 increase is ‘broadly consistent with
inflation since the value was last adjusted in December 2012’.[12]
The budget measure also indicated ‘that the Government will also introduce
ongoing automatic indexation of the penalty unit value based on the CPI. Indexation
will occur on 1 July every three years’.[13]
The Australian Bureau of Statistics releases the CPI figures in catalogue
6401.0, every March, June, September and December.[14]
Ongoing automatic indexation will mean that the Government
will no longer be required to introduce legislative amendments to increase the
penalty unit and is intended to ensure that monetary penalties in Commonwealth
legislation and territory ordinances[15]
‘keep pace with inflation and continue to remain effective in deterring unlawful
behaviour’.[16]
While the triennial increase of the penalty unit amount will occur
automatically, the Minister will be required, under proposed subsection
4AA(1A) of the Crimes Act (at item 3 of the Bill) to publish
the revised amount, by notifiable instrument. (‘Notifiable instruments’ are
provided for under the Acts and Instruments (Framework Reform) Act 2015.[17]
These instruments are not subject to parliamentary scrutiny or sunsetting.[18])
The first indexation proposed under this Bill will occur on 1 July 2018 (proposed
subsection 4AA(3) of the Crimes Act).
The Government estimates that these amendments will
generate an additional $45 million to consolidated revenue over the next four years,
from 2015–16 to 2018–19.[19]
The Government also argues that this increase to the penalty unit will be ‘an
effective deterrent to criminal activity’, including white-collar crime and
serious and organised crime.[20]
Senate Standing Committee for the
Scrutiny of Bills
As at the date of writing, the Scrutiny of Bills Committee
had no comment on this Bill.[21]
Both the Coalition and the Australian Labor Party have previously
introduced and supported legislation to increase the amount of the penalty unit
in the Crimes Act 1914.
The other non-government parties and the independents have
not publically articulated their position on any changes to the penalty unit.
The Australian Crime Commission, in its submission to the
Senate Legal and Constitutional Affairs Committee’s inquiry into the Crimes
Legislation Amendment (Serious Drugs, Identity Crime and Other Measures) Bill
2012, supported the three-yearly review of the amount of a penalty unit introduced
by that Bill ‘as a prudent practice to ensure the deterrent factor remains
high’.[22]
The Explanatory Memorandum states that ‘the Bill will
increase the revenue returned to the Consolidation Revenue Fund for pecuniary
penalties for the commission of Commonwealth criminal offences’.[23]
This measure is estimated to generate $45.0 million in additional revenue over
the forward estimates period.[24]
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.[25]
As at the date of writing, the Parliamentary Joint
Committee on Human Rights had not commented on the Bill.
Items 1 and 2 propose to amend two definitions. Item
1 repeals and replaces the definition of quarter in subsection
3(1) of the Act, to provide that it means ‘a period of three months ending on
31 March, 30 June, 30 September or 31 December’; whereas the previous
definition listed 31 January, 30 April, 31 July and 31 October as the ending
periods.[26]
The term ‘quarter’ is used to calculate the automatic triennial adjustment to
the penalty unit amount.
Item 2 repeals and replaces subsection 4AA(1) of
the Act to change the definition of a penalty unit. Under proposed subsection
4AA(1), penalty unit will mean ‘the amount of $180 (subject to indexation
under subsection (3))’.
Item 3 repeals and replaces subsection 4AA(1A) in
order to remove the requirement for the Attorney-General to review the amount
of the penalty unit every three years after the date it was last reviewed. This
review will no longer be required with the introduction of automatic indexation
based on inflation. Proposed subsection 4AA(1A) will require the
Minister ‘to publish the new penalty unit amount by notifiable instrument after
it is indexed’.[27]
The notifiable instrument will ensure that the new penalty unit amount is
specified for members of the public, enforcing agencies and courts,[28]
but is not subject to parliamentary scrutiny or sunsetting processes.[29]
This proposed subsection will also specify that if the Minister fails to publish
the amount of the penalty unit, it does not invalidate the indexation of the
unit.
Item 4 inserts proposed subsections 4AA(3)-(8).
These proposed subsections will enable automatic indexation of the penalty unit
every three years. They also provide the technical details of how the indexation
is calculated.
Item 5 refers to item 2 (the penalty unit
definition) and ensures that the new penalty unit will apply to offences
committed on or after the commencement of this item (31 July 2015).
This Bill will increase the penalty unit amount for Commonwealth
criminal offences, and provide for automatic indexation in line with inflation
every three years.
Members, Senators and Parliamentary staff can obtain
further information from the Parliamentary Library on (02) 6277 2500.
[1]. Crimes Act 1914,
accessed 12 June 2015.
[2]. Crimes Legislation
Amendment Act 1992, accessed 18 June 2015.
[3]. Attorney-General’s
Department, Review
of Commonwealth Criminal Law: fifth interim report, June 1991.
[4]. Ibid.,
p. 193.
[5]. Ibid.
[6]. Crimes Legislation
Amendment Act 1992, item 19; Department of the Parliamentary Library, Crimes
Legislation Amendment Bill 1992, Bills digest, Parliamentary Library,
Canberra, 28 September 1992, p. 3, accessed 18 June 2015.
[7]. Crimes and Other
Legislation Amendment Act 1997, accessed 18 June 2015.
[8]. MA
Neilsen, Crimes
and Other Legislation Amendment Bill 1996, Bills digest, 101,
1996–97, Parliamentary Library, Canberra, 1996, accessed 18 June 2015.
[9]. Crimes Legislation
Amendment (Serious Drugs, Identity Crime and Other Measures) Act 2012,
accessed 18 June 2015.
[10]. Part
2 of Schedule 3 of the Crimes
Legislation Amendment (Serious Drugs, Identity Crime and Other Measures) Act
2012; Senate Standing Legal and Constitutional Affairs
Committee, Crimes
Legislation Amendment (Serious Drugs, Identity Crime and Other Measures) Bill 2012
[Provisions],
report, The Senate, Canberra, November 2012, p. 6, accessed 18 June 2015.
[11]. M
Biddington, Crimes
Legislation Amendment (Serious Drugs, Identity Crime and Other Measures) Bill
2012, Bills digest, 46, 2012–13, Parliamentary Library,
Canberra, 2012, p. 6, accessed 18 June 2015.
[12]. Australian
Government, Budget measures:
budget paper no. 2: 2015–16, p. 8, accessed 18 June 2015.
[13]. Ibid.
[14]. Australian
Bureau of Statistics (ABS), Consumer price
index, Australia, March 2015, cat. no. 6401.0, ABS, Canberra, 22 April
2015, accessed 16 June 2015.
[15]. Penalty
units apply to both offences under Commonwealth law and under Territory
Ordinances. Subsection 4AA(2) of the Crimes Act 1914 defines a Territory
Ordinance as an ordinance that: (a) was made under an Act for the acceptance,
administration or government of a territory other than the territory of Norfolk
Island; and (b) has not become an enactment of the Australian Capital
Territory. As defined under section 3, a territory does not include the
Northern Territory.
[16]. Explanatory
Memorandum, Crimes
Legislation Amendment (Penalty Unit) Bill 2015, p. 5, accessed 18 June
2015.
[17]. Acts and Instruments
(Framework Reform) Act 2015, accessed 12 June 2015.
[18]. Explanatory
Memorandum, Acts
and Instruments (Framework Reform) Bill 2014, p. 29, accessed 18 June
2015.
[19]. Australian
Government, Budget
measures: budget paper no. 2: 2015–16, p. 8, accessed 18 June 2015.
[20]. M
Keenan, ‘Second
reading speech: Crimes Legislation Amendment (Penalty Unit) Bill 2015’,
House of Representatives, Debates, 15 June 2015, p. 102, accessed 18
June 2015.
[21]. Senate
Standing Committee for the Scrutiny of Bills, Alert
Digest No. 6 of 2015, The Senate, Canberra, 17 June 2015, p. 17,
accessed 18 June 2015.
[22]. Australian
Crime Commission (ACC), Submission
to the Senate Standing Legal and Constitutional Affairs Committee, Inquiry into
the Crimes Legislation Amendment (Serious Drugs, Identity Crime and Other
Measures) Bill 2012, 6 November 2012, p. 3, accessed 18 June 2015.
[23]. Explanatory
Memorandum, Crimes Legislation Amendment (Penalty Unit) Bill 2015, op. cit., p.
2.
[24]. Australian
Government, Budget measures: budget paper no. 2: 2015–16, op. cit., p.
8.
[25]. The
Statement of Compatibility with Human Rights can be found at page 3 of the Explanatory
Memorandum to the Bill.
[26]. Crimes Act
1914, accessed 28 May 2015.
[27]. Explanatory
Memorandum, Crimes Legislation Amendment (Penalty Unit) Bill 2015, op. cit., p.
6.
[28]. Ibid.
[29]. Explanatory
Memorandum, Acts
and Instruments (Framework Reform) Bill 2014, p. 29, accessed 18 June 2015.
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