Concluded matters
2.1
This chapter considers the responses of legislation proponents to
matters raised previously by the committee. The committee has concluded its
examination of these matters on the basis of the responses received.
2.2
Correspondence relating to these matters is included at Appendix 3.
Australian Broadcasting Corporation Amendment (Fair and Balanced) Bill 2017
Purpose |
Amends the Australian
Broadcasting Corporation Act 1983 to introduce a requirement in the
Australian Broadcasting Corporation's (ABC) Charter that the ABC's news
services be 'fair' and 'balanced' |
Portfolio |
Communications |
Introduced |
Senate, 18 October 2017 |
Right |
Freedom of Expression (see Appendix
2) |
Previous report |
12 of 2017 |
Status |
Concluded examination |
Background
2.3
The committee first reported on the Australian Broadcasting Corporation
Amendment (Fair and Balanced) Bill 2017 (the bill) in its Report 12 of 2017,
and requested a response from the Minister for Communications by 13 December
2017.[1]
2.4
The minister's response to the committee's inquiries was received on
14 December 2017. The response is discussed below and is reproduced in full at Appendix 3.
Addition of the words 'fair' and 'balanced' to the ABC Charter
2.5
The bill seeks to insert the words 'fair, balanced' into the existing section
8(1)(c) of the Australian Broadcasting Corporation Act 1983 (the ABC
Act) requirement that news and information is 'accurate and impartial'. The
effect of the amendment would therefore be to broaden the duties of the Board
of the Australian Broadcasting Corporation (ABC) such that the Board has a duty
'to ensure that the gathering and presentation by the Corporation of news and
information is fair, balanced, accurate and impartial according to the
recognized standards of objective journalism'.[2] Neither of these terms is defined in the bill.
Compatibility of the measure with the
right to freedom of expression
2.6
The right to freedom of expression requires states parties to the
International Covenant on Civil and Political Rights (ICCPR) to ensure that
broadcasting services operate in an independent manner and should guarantee
their editorial freedom.[3] By introducing new duties on the ABC Board relating to the gathering and
presentation of news and information, the bill engages and limits editorial
freedom, and therefore may limit the freedom of expression.
2.7
The right to freedom of expression may be subject to limitations that
are necessary to protect the rights or reputations of others, national
security, public order, or public health or morals. In order for a limitation
to be permissible under international human rights law, limitations must be
prescribed by law, pursue a legitimate objective, be rationally connected to
the achievement of that objective and be a proportionate means of achieving
that objective.[4]
2.8
As set out in the initial human rights analysis, the statement of
compatibility acknowledges that the right to freedom of expression is engaged,
however, it further notes that to the extent the bill limits or restricts this
freedom, it does so for a legitimate objective and is reasonable, necessary and
proportionate.[5]
2.9
In relation to the objective of the measure, the statement of
compatibility states:
[Requiring] [t]he ABC to be fair and balanced according to the
recognised standards of objective journalism is a necessary and legitimate
objective. The Australian people expect a publicly funded broadcaster to
canvass a broad range of issues, and report on those issues in a fair and
balanced manner. There is also a strong public interest in ensuring that
Australians have confidence that they can rely on the ABC as a source of
information to inform their views on significant issues. A statutory
requirement for fair and balanced reporting will promote such confidence by the
Australian people.
The fair and balanced requirement is also necessary to
protect the rights and reputations of those who are the subject of ABC
reporting. The Bill will require the ABC Board to ensure that any news or
information relating to, for example, a particular person or group, is
presented to the public in a fair and balanced manner, thereby ensuring that an
impartial view, supported by evidence, is put forward in relation to that
person or group. The fair and balanced requirement would not require every
perspective of an issue to receive equal time, nor every facet of an argument
to be explored. However, it will require openness and impartiality in relation
to the pertinent issues.[6]
2.10 The initial analysis stated that these objectives are capable of
constituting legitimate objectives for the purposes of international human
rights law. However, the statement of compatibility provides limited
information as to the importance of these objectives in the context of the
particular measure. To be capable of justifying a proposed limitation on human
rights, a legitimate objective must address a pressing or substantial concern
and not simply seek an outcome regarded as desirable or convenient.
2.11
A relevant factor in determining whether a limitation on the freedom of
expression is proportionate is whether the law specifies the precise
circumstances in which interferences may be permitted. The words 'fair' and
'balanced' are not defined in the bill and it is not clear from the explanatory
memorandum the intended meaning of the proposed amendments, and how the words
'fair' and 'balanced' differ from the existing requirement that ABC reporting
be 'accurate and impartial'.
2.12
It was noted that the ABC's editorial policy on impartiality states that
the concept of 'impartiality' includes the principles of 'fair treatment' and
'balance that follows the weight of the evidence'.[7] The editorial policy notes that requiring 'balance that follows the weight of
the evidence' prevents 'false balance' that may occur if the ABC was required
to provide equal time to every facet of every argument regardless of the weight
of evidence attached to each argument.[8] The principle of 'fair treatment' under the editorial policy requires the ABC
to be fair-minded in its treatment of people and ideas, including for example
refraining from taking unfair advantage of a participant who is distressed or
vulnerable.[9]
2.13
The statement of compatibility explains that the 'fair and balanced
requirement in legislation would complement these current Editorial Policies',[10] and additionally notes that 'the fair and balanced requirement would not
require every perspective of an issue to receive equal time, nor every facet of
an argument to be explored'.[11] However, as the terms are not defined, it is unclear on the face of the
legislation whether it is proposed that the words 'fair' and 'balanced' bear
the same or a different meaning as the context in which they are used in the
ABC editorial policies relating to impartiality.
2.14
If the words 'fair' and 'balanced' are taken to have the same meaning as
the context in which they are used in the ABC editorial policy on impartiality,
it is not clear why the measure is necessary or addresses a pressing or
substantial concern. If the words have a different meaning, questions arise as
to whether the law is sufficiently circumscribed to constitute a proportionate
limitation on editorial freedom. For example, there is a risk that the concept
of 'balance' could be construed to require differing viewpoints be presented in
a way that is not consistent with the weight of evidence when it supports one
perspective over another.
2.15
The committee therefore sought the advice of the minister as to:
- whether there is reasoning or
evidence that establishes that the stated objective addresses a pressing or
substantial concern or whether the proposed changes are otherwise aimed at
achieving a legitimate objective;
-
how the measure is effective to
achieve (that is, rationally connected to) that objective; and
-
whether the limitation is
proportionate, including information as to the meaning of the words 'fair' and
'balanced', and whether those words are intended to have the same meaning in
the bill as those words used in the ABC's editorial policy on impartiality.
Minister's response
2.16
The minister's response provides the following information on whether
there is reasoning or evidence that the stated objective addresses a pressing
or substantial concern, and whether the measure is effective to achieve the
objective:
While the Australian Broadcasting Corporation's (ABC)
Editorial Policies cover 'fair treatment' and 'a balance that follows the
weight of evidence', these are only internal policies that can be amended at
any time. The legitimate object[ive] of the Bill is to give certainty that it
is a duty of the Board to ensure that the ABC's gathering and presentation of
news and information is 'fair' and 'balanced' according to the recognised
standards of objective journalism.
The purpose of the Bill is to provide certainty that the ABC
continues to present its news and information in a 'fair' and 'balanced'
manner. There is no other way to achieve this obligation in respect of the
Board's duty, other than through legislation. The ABC's Editorial Policies,
while a robust document, could be amended at any time to disregard such an
important part of providing professional and steadfast journalistic news and
information services. The Bill will ensure that 'fair' and 'balanced' reporting
will be a duty of the Board as the obligation will be embedded in legislation.
2.17
As noted in the initial analysis, a legitimate objective must be one
that addresses a pressing or substantial concern, and not merely an outcome
that is desirable or convenient. The minister's response clarifies that
embedding the requirement of 'fair' and 'balanced' reporting in legislation
provides greater certainty of the ABC Board's duties than if those requirements
remain in editorial policies, as such policies are able to be changed at any
time. On balance and in light of the minister's response, this is likely to be
a legitimate objective for the purposes of international human rights law.
2.18
In relation to whether the limitation is proportionate and in particular
the intended meaning of the words 'fair' and 'balanced' in the legislation, the
minister's response states:
The ABC's own Editorial Policies require the ABC to adhere to
fair treatment in the gathering and presentation of news and information, and a
balance in its news reporting that follows the weight of evidence. The measure contained
in this Bill aims to create unity between the ABC Act and the ABC Editorial
Policies; it merely protects this obligation in legislation.
2.19
The statement of compatibility and the minister's response indicate that
the words 'fair' and 'balanced' are intended to have the same meaning as those
words as they are used in the ABC editorial policy, such that the amendments
'create unity' between the legislation and editorial policies by protecting the
obligation in legislation in addition to the editorial policy. The minister's
clarification, coupled with the existing obligations in the ABC Act that
'fair' and 'balanced' reporting must also be 'accurate and impartial according
to the recognized standards of objective journalism',[12] supports a conclusion that on balance the measures are likely to be
proportionate for the purposes of international human rights law.
Committee response
2.20 The committee thanks the minister for his response and has
concluded its examination of this issue.
2.21 On balance and in light of the information provided by the
minister, the committee considers that the measures are likely to be compatible
with the right to freedom of expression.
Corporations (Aboriginal and Torres Strait Islander)
Regulations 2017 [F2017L01311]
Purpose |
Provides for matters
necessary for the effective operation and administration of the Corporations
(Aboriginal and Torres Strait Islander) Act 2006 |
Portfolio |
Prime Minister and Cabinet |
Authorising legislation |
Corporations (Aboriginal
and Torres Strait Islander) Act 2006 |
Last day to disallow |
7 December 2017 |
Right |
Privacy (see Appendix 2) |
Previous report |
13 of 2017 |
Status |
Concluded examination |
Background
2.22
The committee first reported on the Corporations (Aboriginal and Torres
Strait Islander) Regulations 2017 (the regulations) in its Report 13 of 2017,
and requested a response from the Minister for Indigenous Affairs by 20
December 2017.[13]
2.23
The minister's response to the committee's inquiries was received on
18 December 2017. The response is discussed below and is reproduced in full at Appendix 3.
Disclosure of certain documents and information to the public by the
Registrar of Aboriginal and Torres Strait Islander Corporations
2.24
Subregulation 55(1) of the regulations provides that, for the purposes
of paragraph 658-1(1)(k) of the Corporations (Aboriginal and Torres Strait
Islander) Act 2006 (CATSI Act), the Registrar of Aboriginal and Torres Strait
Islander Corporations (registrar) has the function of making certain documents,
and information in those documents, available to the public. Subregulation
55(3) provides that these documents may include documents containing personal
information within the meaning given by subsection 6(1) of the Privacy Act
1988 (Privacy Act).[14]
Compatibility of the measure with
the right to privacy
2.25
The right to privacy includes respect for informational privacy,
including the right to respect for private and confidential information,
particularly the storing, use and sharing of such information; and the right to
control the dissemination of information about one's private life.
2.26
The statement of compatibility states that the regulations are operative
in nature and therefore do not raise any human rights issues. However, the
initial human rights analysis noted that, in allowing for a person's personal information
to be made available to the public, the measure may engage and limit the right
to privacy.
2.27
The right to privacy may be subject to permissible limitations which are
provided by law and are not arbitrary. In order for limitations not to be
arbitrary, the measure must pursue a legitimate objective and be rationally
connected and proportionate to achieving that objective.
2.28
In the absence of further information in the explanatory statement or
statement of compatibility, the initial analysis stated that it was not
possible to determine whether the power given to the registrar to make
information (including personal information) available to the public is in
pursuit of a legitimate objective and is rationally connected to that
objective.
2.29
The initial analysis stated that questions also arise as to whether the
measure is proportionate. In order to be proportionate, limitations on the
right to privacy must be no more extensive than what is strictly necessary to
achieve the legitimate objective of the measure, and be accompanied by adequate
safeguards to protect the right to privacy. It was noted that the registrar may
make documents available to the public that (relevantly) the registrar
'considers appropriate to make available to the public'.[15] The initial analysis set out that it was not clear from the explanatory
statement or statement of compatibility as to how, and under what
circumstances, the registrar may consider it appropriate that documents (which
may contain personal information) should be disclosed to the public. For
example, it was not clear whether the registrar's state of satisfaction is
subject to any objective criteria, such as a requirement that the registrar's
consideration of appropriateness is reasonable.
2.30
The committee therefore sought the advice of the minister as to:
- whether the measure pursues a
legitimate objective;
- whether the measure is effective
to achieve (that is, rationally connected to) that objective; and
- whether the measure is a
proportionate means of achieving the objective (including whether any
limitation on the right to privacy is the least rights-restrictive measure
available, and whether there are adequate safeguards in place to protect the
right to privacy).
Minister's response
2.31
The minister's response acknowledges that the right to privacy is
engaged by the measure, but explains that safeguards are in place to ensure
protection of individuals' privacy whilst ensuring that Aboriginal and Torres
Strait Islander corporations are properly supported and regulated. Ensuring the
proper regulation and support mechanisms for Aboriginal and Torres Strait
Islander corporations is likely to be a legitimate objective.
2.32
The minister explains that documents and information that would be made
public pursuant to subregulation 55(1) only relate to those documents and
information that were created in the context of the predecessor to the CATSI
Act, namely the Aboriginal Councils and Associations Act 1976 (ACA Act),
and includes documents or information filed or lodged with the registrar or
served on the Registrar under the ACA Act, that are kept by the registrar under
the ACA Act, or are given or served on a person by the Registrar under the ACA
Act.
2.33
The minister's response provides a detailed explanation of the nature of
the information the Registrar may make public, by reference to the Registrar's
policy statements PS-12: Registers and the use and disclosure of
information held by the Registrar and PS-01: Providing information and
advice. PS-01: Providing information and advice provides that the nature of
the information that the Registrar may make public is 'by its nature
uncontroversial' and includes:
- the name or Indigenous Corporation Number of a corporation;
-
publicly available details about a corporation appearing on the
Registrar's website;
-
publicly available information or documents on the Register of
Aboriginal and Torres Strait Islander Corporations;
-
providing copies of a corporation's rule book to its members;
-
the address and contact details of the Registrar or staff;
- general information about what functions the Registrar performs;
- information about the Registrar's public education programs;
- official publications produced by the Registrar; and
- standard responses covered by the Registrar's publications.
2.34
The minister's response further explains that, in determining whether it
is appropriate to make the information public, the Registrar will consider:
- whether the information or document would be exempt from
disclosure under the CATSI Act (in which case the documents will not be
disclosed);
-
whether a third party gave the information to the Registrar and
the information related to a particular corporation (such as information
provided by a liquidator or administrator); and
- whether there is a public interest in releasing the information.
2.35
The minister also advises that as an additional safeguard, personal
information in documents may be removed before release.
2.36
The minister's response explains other safeguards in place relating to
the disclosure of personal information:
Paragraph 4.15 of PS-01: Providing information and advice states that: 'The Registrar is also bound by the Australian Privacy Principles
in the Privacy Act 1988 (Privacy Act), which regulate the collection,
use, and storage and collection of personal information. Information received
from individuals will be dealt with in accordance with these statutory
requirements... '
Paragraphs 7.1 to 7.8 of the Registrar's policy statement
PS-15: Privacy, outlines the privacy obligations of the Registrar with
respect to the use and disclosure of protected information. This applies to any
equivalent material contained in documents created under the ACA Act that are
held by the Registrar.
The Office of the Registrar of Indigenous Corporations (ORIC)
has also published a privacy statement on its website to demonstrate its
commitment to protect the privacy of officers of Aboriginal and Torres Strait
Islander corporations. This statement can be found at http://www.oric.gov.au/privacy-statement.
As ORIC is part of the Department of the Prime Minister and Cabinet (PM&C),
it is also bound by PM&C's Privacy Policy.
Through the matters outlined in the relevant policy
statements and the published privacy statements of ORIC and PM&C (published
for the purposes of Australian Privacy Principles 1.3-1.5) as outlined above,
the Registrar and ORIC are committed to the protection of the privacy of
individuals in accordance with the Privacy Act. This includes any documents or
information falling within the scope of section 55 of the CATSI Regulations.
2.37
It is noted that the Australian Privacy Principles in the Privacy Act
1988 are not a complete answer to concerns about interference with the
right to privacy in this context, as those principles contain a number of
exceptions to the prohibition on disclosure of personal information.[16] It is also noted that policy guidance in the form of policy statements and
privacy statements offer less protection than statutory processes, as they can
be amended at any time. However, having regard to the limited nature of the
information that is likely to be disclosed and the requirements to which the
Registrar must have regard before disclosing the information (including that
disclosure be in the public interest), on balance the measure is likely to be
compatible with the right to privacy.
Committee response
2.38 The committee thanks the minister for his response and has
concluded its examination of this issue.
2.39 The preceding analysis indicates that the measure is likely to be
compatible with the right to privacy.
Defence Legislation Amendment (Instrument Making) Bill 2017
Purpose |
Amends the instrument
making powers in the Defence Act 1903, including replacing a number of
inquiry-specific regulation-making powers with a consolidated provision relating
to inquiries concerning the Defence Force; enabling the minister to declare
an area to be a defence aviation area in which buildings and objects can be
regulated for the purposes of removing and reducing hazards to defence
aviation; subjecting certain regulations to monitoring under the Regulatory
Powers (Standard Provisions) Act 2014; establishing an infringement
notice scheme in declared public areas |
Portfolio |
Defence |
Introduced |
House of Representatives,
14 September 2017 |
Rights |
Multiple Rights (see Appendix
2) |
Previous report |
12 of 2017 |
Status |
Concluded examination |
Background
2.40
The committee first reported on the Defence Legislation Amendment
(Instrument Making) Bill 2017 (the bill) in its Report 12 of 2017, and
requested a response from the Minister for Defence by 13 December 2017.[17]
2.41
The bill passed both Houses of Parliament on 16 November 2017 and
received Royal Assent on 30 November 2017.
2.42
The minister's response to the committee's inquiries was received on 19
December 2017. The response is discussed below and is reproduced in full at Appendix 3.
Amendment to the power to make regulations for inquiries
2.43
At present, the Defence (Inquiry) Regulations 1985 (the Inquiry
Regulations) set out the different types of inquiries that can be undertaken in
the Defence Force. These currently include General Courts of Inquiry, Boards of
Inquiry, Combined Boards of Inquiry, Chief of the Defence Force Commissions of
Inquiry, and Inquiry Officer Inquiries.
2.44
The power to make those regulations is presently set out in section
124(1)(gc) of the Defence Act 1903 (Defence Act), which provides that
the Governor-General may make regulations providing for and in relation to 'the
appointment, procedures and powers of courts of inquiry, boards of inquiry,
Chief of the Defence Force commissions of inquiry, inquiry officers and inquiry
assistants'. The bill amends this provision of the Defence Act and replaces it
with a general power to make regulations relating to 'inquiries concerning the defence
force'.[18]
2.45
The bill also amends several provisions that deal with the other powers
included within the power to make regulations for inquiries, so as to replace
the references to specific types of inquiry with a more general reference to
'an inquiry'. This includes amendments to the use and derivative use immunity
provisions in the Defence Act.[19]
Compatibility of the measure with
the right to a fair trial and fair hearing
2.46
The right to a fair trial and fair hearing is protected by article 14 of
the International Covenant on Civil and Political Rights (ICCPR). The right
applies to both criminal and civil proceedings and to cases before both courts
and tribunals, whether ordinary or specialised, civilian or military.[20] The right is concerned with procedural fairness, and encompasses notions of
equality in proceedings, the right to a public hearing and the requirement that
hearings are conducted by an independent and impartial body.
2.47
The statement of compatibility states that the amendment allows greater flexibility
in naming inquiries in the regulations, but does not change the substance of
the regulation-making power. However, the initial analysis noted that the power
to make regulations in relation to inquiries remains very broad, extending to
the 'appointment, procedures and powers' of inquiries. Matters currently dealt
with by the Inquiry Regulations include the conduct of inquiries, the manner of
taking evidence, and the duties of witnesses (including obligations to answer
questions).[21] The committee has previously commented that the Inquiry Regulations engage fair
trial and fair hearing rights.[22] It is likely therefore that any new regulations enacted pursuant to the
broad regulation-making power proposed by the bill would also engage fair trial
and fair hearing rights.
2.48
The committee has previously commented on some of the safeguards
contained in the current Inquiry Regulations. In particular, the committee
concluded that the use and derivative immunity use provisions in the current
Inquiry Regulations appear to be consistent with the right not to incriminate
oneself under international human rights law.[23] However, the initial analysis noted that it is not clear whether other
safeguards will be in place to ensure that the inquiries established pursuant
to the broader regulation-making power proposed by the bill are compatible with
the right to a fair trial and fair hearing. International human rights law
generally requires that states have sufficient safeguards in place to prevent
violations of human rights occurring. Without adequate safeguards, it is
possible that the broad regulation-making power may be exercised in such a way
as to be incompatible with the right to a fair trial and a fair hearing.[24]
2.49
The initial analysis stated that any proposed legislative instrument
revising the Inquiry Regulations will need to ensure that the powers in
relation to defence inquiries are applied in a manner compatible with human
rights. This includes safeguards to ensure that, where the rights of
individuals may arise from an inquiry, the inquiries are established to ensure
the equitable, impartial and independent administration of justice so as to
ensure that such an inquiry takes place under conditions that genuinely afford
the guarantees stipulated in the ICCPR.[25]
2.50
In its initial analysis in Report
12 of 2017, the committee stated that it will consider the human rights
compatibility of any proposed regulations in relation to defence inquiries once
they are received.
Use of force in executing warrants
2.51
The bill additionally seeks to incorporate the standard provisions in
Part 2 of the Regulatory Powers (Standard Provisions) Act 2014 (Regulatory
Powers Act) for monitoring whether the regulations in relation to 'defence
aviation areas' are being complied with.[26] This includes monitoring powers such as powers of entry and inspection,[27] and the requirement that a warrant may be issued if an issuing officer is
satisfied, by information on oath or affirmation, that it is reasonably
necessary that one or more authorised persons have access to a premises.[28]
2.52
The bill would also introduce a new section setting out modifications to
the application of the Regulatory Powers Act in relation to defence aviation
areas, including powers for authorised persons to enter land to take action
such as the removal, destruction or modification of a building, structure or
objects within a defence aviation area, for the purpose of ensuring compliance
with the regulations. The bill also introduces new section 117AF(3) which
provides:
(3) In executing a monitoring warrant for the purposes
mentioned in paragraph (1)(a) [i.e. the purpose of ensuring compliance with the
monitored provision]:
- an authorised person may use such force against
persons and things as is necessary and reasonable in the circumstances; and
- a person assisting the authorised person may use such
force against things as is necessary and reasonable in the circumstances.
2.53
An 'authorised person' is a 'defence aviation area inspector',[29] who is a person appointed as such by the Secretary or Chief of Defence Force
and may include an APS employee in the Department and a member of the Defence
Force.[30]
Compatibility with the right to
life
2.54
The right to life is protected by article 6(1) of the ICCPR and article
1 of the Second Optional Protocol to the ICCPR. The right to life has three
core elements to it:
-
it prohibits the state from arbitrarily killing a person;
-
it imposes an obligation on the state to protect people from
being killed by others or identified risks; and
- it requires the state to undertake an effective and proper
investigation into all deaths where the state is involved.
2.55
The statement of compatibility states that this aspect of the bill does
not engage any applicable rights and freedoms.[31] However, empowering authorised persons to use force against persons may engage
and limit the right to life, as force may be used in a manner that could lead
to a loss of life.
2.56
A measure that limits the right to life may be justifiable if it is
demonstrated that it addresses a legitimate objective, is rationally connected
to that objective and is a proportionate means of achieving that objective. As
no information was provided in the statement of compatibility, the initial
analysis assessed that it was not possible to determine the extent to which
the right to life may be engaged and limited, and whether such a limitation is
permissible.
2.57
Questions arise because there is no definition of what constitutes
'force' (including whether it includes lethal force) and what safeguards are in
place governing the use of force. It is noted that there is a requirement that
a person not be appointed a defence aviation area inspector unless the
appointer 'is satisfied that the person has the knowledge, training or
experience necessary to properly exercise the powers of a defence aviation area
inspector',
[32] but there is no information as to whether that knowledge, training or
experience includes specific training in relation to the use of force in the
context of executing warrants. Further, while the use of force is limited to
'such force against persons as is necessary and reasonable in the
circumstances',
[33] no information is provided in the statement of compatibility as to whether
there is any oversight over the exercise of that power, such as consideration of
any particular vulnerabilities of the person who is subjected to the use of
force, and any access to review to challenge the use of force.
2.58
The committee therefore sought
the advice of the minister as to the compatibility of the measure with this
right, including:
- whether the measure is aimed at achieving a legitimate objective
for the purposes of human rights law;
- how the measure is effective to achieve (that is, rationally
connected to) that objective; and
- whether the limitation is a reasonable and proportionate measure
to achieve the stated objective.
Compatibility with the right to
freedom from torture, cruel, inhuman and degrading treatment or punishment
2.59
Article 7 of the ICCPR and the Convention against Torture provide an
absolute prohibition against torture, cruel, inhuman or degrading treatment or
punishment. This means torture can never be justified under any circumstances,
regardless of the objective sought to be achieved. The aim of the prohibition
is to protect the dignity of the person and relates not only to acts causing
physical pain but also those that cause mental suffering.
2.60
As noted above, the statement of compatibility states that this aspect
of the bill does not engage any applicable rights and freedoms.[34] However, empowering persons to use force against other persons may engage these
rights, as force may be used in such a way that causes pain (physical or
mental) in such a way that it amounts to a violation of Article 7.
2.61
The initial analysis noted that there are concerns as to whether the
breadth of the proposed powers may lead to an authorised person taking action
that may constitute degrading treatment for the purposes of international human
rights law. As set out above at [2.56] and [2.57], questions arise as to what
constitutes 'force', whether there are adequate safeguards in place in relation
to the use of force, and whether there is any monitoring or oversight over the
exercise of the use of force, such as consideration of any particular
vulnerabilities of the person who is subjected to the use of force, and any
access to review to challenge the use of force.
2.62
The committee therefore sought the advice of the minister as to the
compatibility of the measure with this right, including any safeguards in place
governing the use of force, and any monitoring or oversight in relation to the
use of force.
Minister's response
2.63
The minister's response provides the following information in relation
to the committee's inquiries:
While in most cases Defence can reach agreement with
landowners regarding aviation hazards, the powers referred to in the new
provisions of the Bill are important because they provide guidance in the event
that agreement is not possible. The provision relating to use of force is aimed
at achieving a legitimate objective, being the removal or reduction of hazards
to defence aviation to enhance the safety of defence aviation.
Under new subsection 117AF(3), use of force against a person
is limited to defence aviation area inspectors. Before appointing a defence
aviation area inspector, the Secretary or the Chief of the Defence Force must
be satisfied that the person has the knowledge, training or experience
necessary to properly exercise the powers of a defence aviation area inspector.
Since those powers include the power to use necessary and reasonable force,
this will require the person to have sufficient knowledge, training or
experience necessary to properly exercise the power to use force.
Importantly, the use of force is limited to what is necessary
and reasonable. Factors that may be relevant in determining what is reasonable
include the urgency of the aviation situation, other avenues that may be
available to remove or reduce the hazard, the effect not removing or reducing the
hazard will have on safety or operational requirements, and the particular
circumstances of the person in question. Apart from a situation involving
self-defence, it is difficult to imagine a scenario which would justify the
deliberate use of lethal force or force that would cause serious injury to a
person.
If a defence aviation area inspector used force beyond what
was necessary or reasonable, they would be subject to the ordinary criminal
law, and could be investigated and prosecuted the same as any other person. A
person subjected to the use of force would be able to report to the police or
complain to Defence.
In this context, Defence considers that the chances of this
provision limiting the right to life or the right to freedom from torture,
cruel, inhuman and degrading treatment or punishment, extremely remote.
2.64
The objective of enhancing the safety of defence aviation is likely to
be a legitimate objective for the purpose of human rights law, and providing
for defence aviation inspectors to use force to remove or reduce hazards
appears to be rationally connected to this objective.
2.65
The minister's explanation of the factors relevant to determining
whether (and the extent to which) to use force, and the clarification that the Secretary
or the Chief of the Defence Force must be satisfied that a defence aviation
inspector has the knowledge, training or experience necessary to properly
exercise the powers of a defence aviation area inspector (including adequate
training in relation to the use of force), assists in determining compatibility
with the right to life and the right to freedom from torture, cruel, inhuman
and degrading treatment. This information provided by the minister, coupled
with the requirement in the bill that any force used may only be that which is
reasonable and necessary in the circumstances, tends to suggest that the risk
of the use of force being lethal force or force that would cause serious injury
to a person, is very low. On balance and in light of the information provided
by the minister, the measure appears to be compatible with the right to life
and the right to freedom from torture, cruel, inhuman and degrading treatment.
Committee response
2.66 The committee thanks the minister for her response and has
concluded its examination of this issue.
2.67 In light of the information provided by the minister, the measure
appears to be compatible with the right to life and the right to freedom from
torture, cruel, inhuman and degrading treatment.
Financial Sector Legislation Amendment (Crisis Resolution Powers and Other
Measures) Bill 2017
Purpose |
Amends the Banking Act 1959, Insurance Act 1973, Life Insurance Act 1995 and five
other Acts to give the Australian Prudential Regulation Authority additional
powers for crisis resolution, and resolution planning, in relation to
regulated entities |
Portfolio |
Treasury |
Introduced |
House of Representatives,
19 October 2017 |
Rights |
Right not to incriminate
oneself; privacy (see Appendix 2) |
Previous report |
12 of 2017 |
Status |
Concluded examination |
Background
2.68
The committee first reported on the Financial Sector Legislation
Amendment (Crisis Resolution Powers and Other Measures) Bill 2017 (the bill) in
its Report 12 of 2017, and requested a response from the Treasurer by 13
December 2017.[35]
2.69
The Treasurer's response to the committee's inquiries was received on
14 December 2017. The response is discussed below and is reproduced in full at Appendix 3.
Information gathering powers of statutory managers
2.70
The bill would insert a new section 62ZOD into the Insurance Act 1973 (Insurance Act) and a new section 179AD into the Life Insurance Act 1995 (Life Insurance Act) which set out the powers and functions of statutory
managers under the Insurance Act and Life Insurance Act respectively.[36]
2.71
This includes a new power to require a person who has, at any time, been
an officer of the body corporate to give the statutory manager information
relating to the business of the body corporate that the statutory manager
requires.[37] A person commits an offence punishable by 12 months imprisonment if the person
fails to comply with this requirement to give information.[38]
An individual is not excused from complying with the requirement to give
information on the ground that doing so would tend to incriminate the
individual or make the individual liable to a penalty.[39]
2.72
However, information given in compliance with the requirement is not
admissible in evidence against the individual in a criminal proceeding or a
proceeding for the imposition of a penalty, other than proceedings in respect of
the falsity of the information, provided the person has claimed the privilege
against self-incrimination before giving that information and that giving the
information might in fact incriminate the individual.[40]
Compatibility of the measure with
the right not to incriminate oneself
2.73
The specific guarantees of the right to a fair trial in the
determination of a criminal charge guaranteed by article 14 of the ICCPR
include the right not to incriminate oneself (article 14(3)(g)).
2.74
The right to a fair trial, and in particular the right not to
incriminate oneself, is engaged where a person is required to give information
to the Insurance Act or Life Insurance Act statutory manager which may
incriminate them and that incriminating information can be used to investigate
criminal charges. The statement of compatibility acknowledges the privilege
against self-incrimination is engaged by the bill.[41]
2.75
The right not to incriminate oneself may be subject to permissible
limitations where the limitation pursues a legitimate objective, is rationally
connected to that objective and is a proportionate way of achieving that
objective. The statement of compatibility states that the limitation on the
right not to incriminate oneself is permissible on the basis that:
Engaging the right against self-incrimination in this way is
necessary and justified as only the key personnel of a relevant entity will
have access to information and documents relating to that entity’s financial
condition. It is essential for APRA or a statutory manager to be able to obtain
this information quickly to assist with the management and crisis resolution of
an insurance or life insurance entity that is financially distressed.
By compelling relevant officers to provide the required
information and documents, APRA and other statutory managers will be able to
maximise their ability to rehabilitate a distressed insurance or life insurance
entity. This will benefit the entity’s customers, creditors and other
suppliers...[42]
2.76
A legitimate objective – that is, one that is capable of justifying a
proposed limitation on human rights – must address a pressing or substantial
concern and not simply seek an outcome regarded as desirable or convenient. The
initial analysis stated that the statement of compatibility does not provide
any information or evidence as to the pressing or substantial need to be able
to obtain information quickly to assist with the management and crisis
resolution of an insurance or life insurance entity. The administrative
convenience, in and of itself, is unlikely to be sufficient to constitute a
legitimate objective for the purposes of international human rights law.
2.77
Further, the availability of 'use' and 'derivative use' immunities can
be one important factor in determining whether the limit on the right not to
incriminate oneself is proportionate. That is, they may act as a relevant
safeguard. In this respect, the initial assessment noted that information
gathering powers in proposed sections 62ZOD and 179AD relating to statutory
managers include a 'use' immunity provision, such that incriminating
information or documents provided cannot be directly used against a person in
criminal proceedings or in proceedings where the person may be liable to a
penalty.[43] However, no 'derivative use' immunity is provided for proposed sections 62ZOD and
179AD, which would prevent information or evidence indirectly obtained from
being used in criminal proceedings against the person.
2.78
In contrast, it is noted that in relation to APRA's information
gathering powers which are also introduced by this bill in proposed sections
62ZOI and 179AI, both a 'use' and a 'derivative' use immunity provision are
included, such that information or documents obtained 'as a direct or indirect
consequence' of providing information are not admissible against the person.[44]
2.79
The lack of derivative use immunity in relation to the information
gathering powers of statutory managers in proposed sections 62ZOD and 179AD
raises questions about whether the measure is the least rights restrictive way
of achieving its objective. It was acknowledged that a 'derivative
use' immunity will not be appropriate in all cases because it is not reasonably
available as a less rights restrictive alternative (for example, because it
would undermine the purpose of the measure or be unworkable). In this respect,
it was noted that the availability or lack of availability of a 'derivative
use' immunity needs to be considered in the regulatory context of the proposed
powers. The extent of interference that may be permissible as a matter of
international human rights law may be, for example, greater in contexts where
there are difficulties regulating specific conduct, persons subject to the
powers are not particularly vulnerable or powers are otherwise circumscribed with
respect to the scope of information which may be sought. That is, there are a
range of matters which influence whether the limitation is proportionate. However,
no information is provided in the statement of compatibility to explain
why a 'derivative use' immunity is provided in relation to persons who give
information in compliance with APRA's information gathering powers, but not to
persons who give information in compliance with statutory manager's information
gathering powers.
2.80
Noting the preceding analysis,
the committee sought the advice of the Treasurer as to:
- whether there is reasoning or
evidence that establishes that the stated objective addresses a pressing or
substantial concern or whether the proposed changes are otherwise aimed at
achieving a legitimate objective for the purposes of international human rights
law;
- how the measure is effective to
achieve (that is, rationally connected to) that objective;
- whether the limitation is
proportionate to achieve the stated objective;
- whether the persons who may be
subject to examination and the scope of information that may be subject to
compulsory disclosure is sufficiently circumscribed with respect to the stated
objective of the measure; and
- whether a derivative use
immunity is reasonably available as a less rights restrictive alternative in sections
62ZOD of the Insurance Act 1973 and 179AD of the Life Insurance Act
1995 to ensure information or evidence indirectly obtained from a person
compelled to give information or documents cannot be used in evidence against
that person.
Treasurer's response
2.81
The Treasurer's response first explains the broader objectives, context
and necessity for the bill:
... [the amendments proposed by the bill] will enable APRA to
appoint a statutory manager to an insurer or, in certain circumstances, a
related body corporate. Appointment of a statutory manager will generally only
occur in situations of urgency, for example where the failing insurer poses a
threat to financial system stability.
There is a pressing need for such a measure because of the
lack of a statutory management regime for insurers as compared with the Banking
Act and consequently, a substantial gap in APRA's resolution regime for
insurers to effectively and efficiently manage and resolve a distressed or
failing insurer. Statutory management powers will be exercised with the broad
objectives of protecting the interests of policyholders of insurers and ensuring
the stability of Australia's financial system, both of which are such pressing
or substantial concerns for most Australians that the limitation upon the right
to claim privilege against self-incrimination in the measure is warranted and
justified.
2.82
In relation to whether there is reasoning or evidence that the stated
objective addresses a pressing or substantial concern, and how the measure is
effective to achieve the stated objective, the Treasurer's response explains:
It is critical that a statutory manager, having taken over
what will often be an insolvent or near insolvent financial institution or
related entity, be in a position to obtain all relevant information relating to
the business of the body corporate from officers (and former officers) in order
for the statutory manager to control, stabilise, investigate and (to the extent
possible) resolve the body corporate or resolve a related entity.
Overriding the privilege against self-incrimination is
justified in this context because only the key personnel of an insurer will
have access to information and documents relating to the insurer's business,
including its financial condition. It is essential for a statutory manager to
be able to obtain this information quickly to assist with the management and
crisis resolution of an insurer that is financially distressed. In
circumstances where an insurer is distressed or failing, especially where its
failure may have an adverse effect on financial stability, time is of the
essence in ensuring the orderly resolution of the insurer. By compelling
relevant officers or ex-officers promptly to provide required information and
documents relating to the business of the body corporate, statutory managers
will be able to maximise their ability to rehabilitate a distressed insurer, or
to ensure an orderly resolution and exit of a failing insurer. This will
ultimately benefit the insurer's customers, creditors and other suppliers. In
the event of a significant crisis, APRA would also be able to use the
information gathered to support decision making and prevent contagion in the
financial system, ensuring that financial system stability is maintained.
2.83
The Treasurer's response provides an explanation as to the pressing or
substantial need to be able to obtain information quickly to assist with the
management and crisis resolution of an insurance or life insurance entity, and
it is likely that in this case the information gathering powers pursue a
legitimate objective for the purposes of international human rights law, and are
rationally connected to that objective.
2.84
As to the proportionality of the proposed measure, the Treasurer's
response explains that the information gathering powers can only be used in
limited circumstances in a particular regulatory context, namely, where a
statutory manager has been appointed. The Treasurer explains that there is a
high threshold for triggering such an appointment to an insurer or related body
corporate. For example, the Treasurer explains that certain conditions for the
appointment must first be met (such as insolvency) and that at least one of a
number of conditions must be satisfied before such an appointment to an insurer
or body corporate is made, including that the failure of the insurer poses a
threat to the stability of the financial system.
2.85
The Treasurer further explains that the information gathering applies to
a narrow group of persons. In particular, the Treasurer explains that the
powers apply only in relation to an 'officer' as defined in section 9 of the Corporations
Act 2001 (the Corporations Act) (e.g. a director or other senior person
with significant strategic responsibilities in relation to the failing entity),
and a person who has been such an officer. The Treasurer explains the rationale
for applying the information-gathering powers to officers as follows:
Circumstances may exist where the failure of the insurer can
be attributed to a failure by one or more officers to comply with their
statutory responsibilities, including where there has been a breach of Corporations
Act provisions carrying an offence. This raises the real possibility of the
statutory manager's ability to fulfil his or her duties being hampered by a
refusal to provide information on self-incrimination grounds, making the
override of the privilege against self-incrimination necessary in this
instance.
2.86
The Treasurer further explains that, in this particular regulatory
context, the absence of a derivative use immunity is necessary for the
following reasons:
...if derivative use immunity is applied, it would often be
very difficult for the prosecution to show that the evidence they rely on to
prove a criminal case against an officer relating to the failure of the
financial institution was uncovered through an absolutely independent and
separate investigation process. This may in turn lead to hesitation on the part
of a statutory manager to exercise the information gathering power, undermining
the purpose for which the power was conferred.
If derivative use immunity applied, then further evidence
obtained through a chain of inquiry resulting from the protected evidence
cannot be used in relevant proceedings even if the additional evidence would
have been uncovered through independent investigative processes. Also, where
the information-obtaining power is exercised against officers or ex-officers
who may have been responsible for the deterioration or failure of a financial
institution, for example, a director implicated in a failure such as HIH, a
derivative use immunity would not be helpful in building a case against the
director for breach of their duties under law.
These provisions are consistent with the majority of existing
self-incrimination provisions in other APRA-administered legislation, including
provisions in the Superannuation Industry (Supervision) Act 1993 (the
SIS Act) and Private Health Insurance (Prudential Supervision) Act 2015 (PHI Act).
2.87
Finally, the Treasurer explains the rationale for why a 'derivative use'
immunity is provided in relation to persons who give information in compliance
with APRA's information gathering powers, but not to persons who give
information in compliance with statutory manager's information gathering
powers:
The committee has also noted the difference between APRA's
proposed information gathering powers (in proposed sections 62ZOI of the
Insurance Act and 179AI of the Life Insurance Act), which includes derivative
use immunity, and the proposed statutory manager's powers to require officers
to provide information (in proposed sections 62ZOD and 179AD), which do not. ...
APRA's information gathering power applies in respect of any
person while the statutory manager's information gathering power is more
circumscribed in scope and applies only in respect of officers (and
ex-officers) of an insurer. This is a crucial distinction. Officers are in a
different situation to ordinary persons in that they are the key personnel of
the insurer with greater access to the relevant information and documents
relating to the insurer. Also, an officer may well have breached directors' duties
in connection with the failure of the insurer. Therefore, while use immunity is
appropriate in this context, derivative use immunity may impede any prosecution
or penalty proceedings against these officers for breach of their duties,
especially given the issues identified above relating to the application of
derivative use immunity. By contrast, APRA's information gathering power
extends to any person, including an ordinary citizen, and the greater
protection afforded by derivative use immunity is justified in this particular
context because of the wider scope of the power.
2.88
As noted in the initial analysis, there are a range of matters which
influence whether a limitation on the right not to incriminate oneself is
permissible. In the present case, the Treasurer has explained in detail the
regulatory context of the proposed powers and the application of the powers to
officers and former officers who may have greatest access to relevant
information and documents relating to insurers (rather than all persons). The
Treasurer's therefore response suggests that a 'derivative use' immunity is not
reasonably available in this context. In light of the further information
provided by the Treasurer, it is likely that the limitation on the right not to
incriminate oneself is proportionate to the legitimate objective of the
measure.
Committee response
2.89 The committee thanks the Treasurer for his response and has
concluded its examination of this issue.
2.90 In light of the information provided by the Treasurer and in the
particular regulatory context of the measure, the committee considers that the
limitation on the right not to incriminate oneself is proportionate to the
legitimate objective of the measure.
Information sharing provisions
2.91
Schedule 4 of the bill includes a number of proposed amendments to the Financial
Sector (Business Transfer Group Restructure) Act 1999 (Transfer Act) to
extend the scope of section 42 of the Transfer Act to allow APRA to provide
information (including personal information) to a body that receives the shares
of another body as part of a compulsory transfer of business.[45]
Compatibility of the measure with
the right to privacy
2.92
The right to privacy encompasses respect for informational privacy,
including the right to respect private information and private life,
particularly the storing, use and sharing of personal information. Schedule 4
of the bill engages and limits the right to privacy by enabling APRA to provide
information, which includes personal information, to a receiving body.
2.93
The statement of compatibility acknowledges that the right to privacy is
engaged and limited by the proposed amendment to section 42 of the Transfer
Act. As to the objective of the proposed amendment, the statement of compatibility
explains:
The provision is necessary because under the compulsory
transfer provisions a receiving body’s board must consent to the transfer. In
order to facilitate this it will be necessary and appropriate for APRA to
provide information to the receiving body about the business, including
confidential information and information relating to staff and executives of
the body being transferred. It will also be necessary for APRA to share such
information in the process of settling the detail of the transfer, including
the schedule of assets and liabilities, and in documentation relating to
transferred staff.[46]
2.94
As noted earlier in relation to the right against self-incrimination, a
legitimate objective must address a pressing or substantial concern. While the
statement of compatibility states that the provision is necessary, it is not
clear from the information provided how this aspect of the bill addresses a
pressing or substantial concern that would justify a limitation on the right to
privacy.
2.95
The statement of compatibility then sets out safeguards that are
contained in the bill to protect the right to privacy, namely that:
-
the Privacy Act 1998 (Privacy Act) would apply to the
information;
- where information is provided to APRA, the existing APRA
confidentiality provisions would apply; and
- where information is provided to other statutory managers, the
statutory manager would be responsible for the relevant entity and as such
their access to the information would be no different to the previous manager's
access to the information.[47]
2.96
However, the initial analysis stated that these safeguards do not
demonstrate that the limitation on the right to privacy is proportionate to the
objective sought to be achieved. For example, while the Privacy Act contains a
range of general safeguards it is not a complete answer because the Privacy Act
and the Australian Privacy Principles (APPs) contain a number of exceptions to
the prohibition on disclosure of personal information. Relevantly, for example,
an agency may disclose personal information or a government related identifier
of an individual where its use or disclosure is required or authorised by or
under an Australian Law.[48] This means that the Privacy Act and the APPs may not operate as an effective safeguard
of the right to privacy in these circumstances.
2.97
Further, the initial analysis noted that no information is provided
setting out the content of APRA's confidentiality provisions, and how these
provisions would apply to safeguard personal information. It was stated that it
is not possible to determine at this stage whether the APRA confidentiality
provisions provide an adequate safeguard. Similarly, while the amendments will
place the statutory manager in no different position to the previous manager's
access to information, it is not clear from the information provided the extent
of the previous manager's access to information. Therefore, it is not possible
to conclude based on the information provided whether the measure is
sufficiently circumscribed to constitute a proportionate limitation on the
right to privacy.
2.98
The committee therefore sought
the advice of the Treasurer as to:
- whether there is reasoning or
evidence that establishes that the stated objective addresses a pressing or
substantial concern or whether the proposed changes are otherwise aimed at
achieving a legitimate objective for the purposes of international human rights
law;
- how the measure is effective to
achieve (that is, rationally connected to) that objective; and
- whether the limitation is proportionate
to achieve the stated objective.
Treasurer's response
2.99
The Treasurer's response provides an overview of the current transfer
powers under the Transfer Act, and explains the amendments introduced by the
bill and their objective as follows:
The Bill supplements the Transfer Act by providing that, as
an alternative to requiring a transfer of business, APRA may transfer the
shares (ownership) of the failing entity to a new owner. The ability to
transfer the shares of a failing regulated entity could, in some circumstances,
provide a more efficient and simpler means of achieving an orderly resolution,
than affecting a full transfer of all of the assets and liabilities of the
entity. This is an enhancement of the Transfer Act to provide APRA with greater
flexibility and certainty when considering the resolution options available to
address and resolve a failing entity. The enhancement will enable APRA to more
quickly achieve an orderly resolution of a distressed entity which is in the
interests of most Australians as it helps prevent contagion in the financial
system, ensuring that financial system stability is maintained.
As with other resolution powers to be exercised by APRA,
compulsory transfer powers are exercised with the broad objectives of
protecting the interests of depositors and policyholders and maintaining the
stability of Australia's financial system, both of which are such pressing or
substantial concerns for most Australians that the limitation to privacy in the
measure is warranted and justified.
2.100
The stated objective of protecting the interests of depositors and
policyholders and maintaining the stability of Australia's financial system is
likely to be legitimate for the purposes of international human rights law.
2.101
The Treasurer's response also explains how the proposed information
sharing powers are rationally connected to this objective as follows:
As explained in the statement of compatibility referred to by
the committee, the proposed information sharing provisions (in particular, the amended
section 42, applicable to both transfer of shares and transfer of business) are
a necessary component of the framework for transfers under the Transfer Act.
In order for APRA to require a compulsory transfer, a
receiving body's board must consent to the transfer from the transferring body
(as is currently the case with a transfer of business). As with a transfer of
business, in order for the receiving body's board to consent, it must be
apprised of relevant knowledge of what is to be transferred to it, including
all relevant information and documentation pertaining to the transferring body
which may contain personal information relating to staff or individuals who
have insurance or other arrangements with the failed entity. Without being so
informed, it is impossible for the board to reach a decision as to whether to
consent to the transfer. Therefore the information sharing provisions ensure
that the receiving body can be provided relevant information about the staff,
management and insurance arrangements as part of their due diligence when they
are deciding whether or not to consent to the transfer.
2.102
The Treasurer's response also provides further information as to the
safeguards in place to protect the right to privacy. The Treasurer explains
that section 56 of the Australian Prudential Regulation Authority Act 1998 (APRA Act) imposes confidentiality upon APRA officers in respect of 'protected
information' and 'protected documents'. Documents and information become
'protected' by virtue of both having been received by APRA and relating to the
affairs of entities that APRA regulates, or customers of those entities, or
entities that APRA registers or collects data from under the Financial
Sector (Collection of Data) Act 2001 (FSCODA). The Treasurer's response
continues:
Subsection 56(2) of the APRA Act makes it an offence for a
person who is, or has been, an APRA officer to disclose protected information
or a protected document to any person or to a court, subject to certain
exceptions. Information relating to a transferring body subject to the proposed
information sharing provisions under the measure would be protected information
under section 56 of the APRA Act as having been received by APRA and relating
to the affairs of entities regulated by APRA.
The secrecy regime under section 56 extends to the receiving
body's officers because they fall within paragraph (c) of the definition of
'officer' in subsection 56(1) of the APRA Act (received in course of their
employment). As such, onward disclosure of the information by the receiving
body to other persons is restricted under section 56.
Also, as noted in section 42 of the Transfer Act, subsection
56(9) of the APRA Act allows for conditions to be imposed on disclosure of
protected information to restrict the use to which the receiving body may put
the information to. Failure to comply with any condition so imposed is an
offence. For example, if APRA were to disclose information about staff or
insurance contracts of a failed insurer to a body corporate that was
considering taking on ownership of the failed insurer via a transfer of shares,
APRA could impose conditions under subsection 56(9) on the body corporate and
its officers at the time of disclosing the information. Such conditions might
require the recipients to only use the information for the purposes of deciding
whether or not to accept the transfer, and not to further disclose the
information.
As such, the secrecy regime under section 56 of the APRA Act
affords an effective and appropriate degree of protection to any personal
information that may be included within protected information. Where the
information is provided to a statutory manager, it is important to note that a
statutory manager is, in any case, subject to the secrecy regime under section 56
of the APRA Act, as signposted under subsection 14C(5) of the Banking Act, and
proposed subsections 62ZOK(4) and 179AK(4) of the Insurance Act and Life
Insurance Act respectively.
2.103
Based on the information provided in the Treasurer's response, it
appears that there are a number of safeguards in place in order to protect any
personal information that may be disclosed. On balance, it is likely the
measure will be compatible with the right to privacy.
Committee response
2.104
The committee thanks the Treasurer for his response and has
concluded its examination of this issue.
2.105
In light of the information provided in the Treasurer's response,
the committee considers that the measure is likely to be compatible with the
right to privacy.
Health Insurance (General Medical Services Table) Amendment (Obstetrics)
Regulations 2017 [F2017L01090]
Purpose |
Amends the Health
Insurance (General Medical Services Table) Regulations 2017 to introduce
a requirement that during the planning and management of a pregnancy a mental
health assessment be performed by a medical practitioner or other qualified
health professional, including screening for drug and alcohol use and
domestic violence |
Portfolio |
Health |
Authorising legislation |
Health Insurance Act
1973 |
Last day to disallow |
16 November 2017 |
Right |
Privacy (see Appendix 2) |
Previous report |
12 of 2017 |
Status |
Concluded examination |
Background
2.106
The committee first reported on the Health Insurance (General Medical
Services Table) Amendment (Obstetrics) Regulations 2017 [F2017L01090] (the
regulations) in its Report 12 of 2017, and requested a response from the
Minister for Health by 13 December 2017.[49]
2.107
The minister's response to the committee's inquiries was received on
8 December 2017. The response is discussed below and is reproduced in full at Appendix 3.
Mental health assessments during pregnancy
2.108
The regulations introduce changes to the Medicare Benefits Schedule
(MBS). The MBS provides for the payment of Medicare benefits for professional
services rendered to eligible persons, and for the calculation of Medicare
benefits by reference to the fees for medical services which are set out in
prescribed tables. The regulations include the introduction of a new
requirement during the planning and management of a pregnancy for a mental health
assessment to be performed by the medical practitioner or another suitably
qualified health professional. The mental health assessment includes 'screening
for drug and alcohol use and domestic violence of the patient'.[50] A mental health assessment (including screening for drug and alcohol use and
domestic violence) is also required in postnatal consultations between 4 and 8
weeks after birth.[51]
Compatibility of the measure with
the right to privacy
2.109
The right to privacy prohibits arbitrary or unlawful interferences with
an individual's privacy, family, correspondence or home. The right to privacy
includes the right to personal autonomy and physical and psychological
integrity, including respect for reproductive autonomy and autonomy over one's
own body (including in relation to medical testing). The statement of
compatibility does not consider whether the right to privacy is engaged or
limited by the bill.
2.110
The initial human rights assessment stated that, based on the
information provided, it was not clear as to the extent to which the mental
health assessment will be compulsory, and what 'screening' entails. If a
patient may refuse to take the test, and if 'screening' is minimally invasive
(such as being limited to asking questions), the analysis noted that it may be
that a patient's right to personal autonomy and physical and psychological
integrity is not limited. However, if 'screening' includes more invasive
procedures, such as a blood test to test for alcohol or drugs, the right to
personal autonomy and physical and psychological integrity as an aspect of the
right to privacy may be engaged and limited.
2.111
Limitations on the right to privacy will be permissible where they are
not arbitrary, they pursue a legitimate objective, are rationally connected to
that objective and are a proportionate means of achieving that objective.
The explanatory statement and the statement of compatibility note that the
objective of the regulations is to improve obstetrics care for patients and to
implement the recommendations of the MBS Review Taskforce so as to reflect
current best clinical practice in light of the latest evidence and to improve
health outcomes. The initial analysis stated that these are likely to be legitimate
objectives for the purposes of international human rights law. Screening for
mental health issues during and immediately following pregnancy appears also to
be rationally connected to those objectives.
2.112
However, as noted earlier, it is unclear based on the information
provided what 'screening' of a patient for drugs or alcohol or domestic
violence entails, and whether the screening is mandatory for the patient. If
the screening is mandatory or involves the collection of blood samples or other
tests for drug or alcohol use, such that the measure places a limitation on the
right to privacy, then it will need to be demonstrated that this is the least
rights-restrictive approach to achieve the legitimate objective, and that
adequate safeguards are in place in relation to the use of samples and test
results.
2.113
The committee therefore sought the advice of the minister as to:
-
what is meant by 'screening for
drug and alcohol use and domestic violence', including whether it includes
taking a blood test or related procedures;
- whether it is compulsory for a
patient to undertake a mental health assessment (including screening for drug
and alcohol use and domestic violence);
- what are the consequences for a
refusal to undertake such an assessment; and
- whether the screening for drug
and alcohol use and domestic violence is proportionate, including whether the
measure is the least rights-restrictive means reasonably available to achieve
the stated objective, and the effectiveness of any safeguards to protect a
patient's privacy.
Minister's response
2.114
The minister's response provides the following information to the
committee:
- The mental health assessment can
be met if the medical practitioner enquires about the mental wellbeing of the
patient. This is a mandatory requirement.
- If the patient consents to a
comprehensive assessment, the medical practitioner can discuss significant risk
factors to the patient's wellbeing (such as drug and alcohol use and domestic
violence).
-
If the patient does not consent to
a comprehensive assessment, a Medicare benefit is still payable for the
service. This ensures that all patients will continue to have access to
Medicare-subsidised obstetrics services.
...
The provision of a comprehensive mental health assessment,
subject to the patient's consent, is intended to enable the prevention or early
detection of mental health disorders. These disorders, which affect one in 10
women during pregnancy and one in seven women after birth, have the potential
to have a negative impact on the physical and mental wellbeing of mothers and
their children.
2.115
In relation to the meaning of 'screening for drug and alcohol use and
domestic violence', the minister explains:
...the word 'screening' in items 16590 and 16591 and new
postnatal item 16407. In the context of these items, screening does not involve
the use of any diagnostic techniques such as diagnostic imaging or pathology
tests. Screening is simply asking patients a series of questions on certain
risks [sic] factors. In other words, it is part of the comprehensive mental
health assessment which the patient may or may not consent to. This terminology
would be understood by medical practitioners and is consistent with the
relevant clinical guidelines, Mental Health Care in the Perinatal Period:
Australian Clinical Practice Guideline.
As noted above, if the patient does not consent to a
comprehensive assessment, a Medicare benefit is still payable for the service.
2.116
The minister's response explains that the proposed mental health
screening is minimally invasive, does not involve diagnostic techniques such as
pathology tests, and can only be undertaken with the patient's consent. Based
on the further information provided by the minister, it is likely that the
measure will be compatible with the right to privacy.
Committee response
2.117
The committee thanks the minister for his response and has
concluded its examination of this issue.
2.118
In light of the further information provided by the minister, the
committee considers that the measure is likely to be compatible with the right
to privacy.
Proceeds of Crime Amendment (Proceeds and Other Matters) Bill 2017
Purpose |
Seeks to amend the Proceeds
of Crime Act 2002, including to align the unexplained wealth regime with other types of orders, so that it covers
situations where wealth is 'derived or realised, directly or indirectly' from
certain offences; clarifies that property becomes 'proceeds' or an
‘instrument’ of an offence under the Act when 'proceeds' or an 'instrument'
are used to improve the property or discharge an encumbrance security or
liability incurred in relation to the property; and clarifies that property
or wealth will only be 'lawfully acquired' in situations where the property
or wealth is not ‘proceeds’ or an ‘instrument’ of an offence |
Portfolio |
Justice |
Introduced |
House of Representatives,
18 October 2017 |
Rights |
Right to a fair trial;
right to a fair hearing; privacy (see
Appendix 2) |
Previous report |
12 of 2017 |
Status |
Concluded examination |
Background
2.119
The committee first reported on the Proceeds of Crime Amendment
(Proceeds and Other Matters) Bill 2017 (the bill) in its Report 12 of 2017,
and requested a response from the Minister for Justice by 13 December 2017.[52]
2.120
The minister's response to the committee's inquiries was received on 19
December 2017. The response is discussed below and is reproduced in full at Appendix 3.
Changes to the definition of 'proceeds' and an 'instrument' in the Proceeds
of Crime Act
2.121
The bill seeks to amend the definitions of 'proceeds' and 'instrument'
in the Proceeds of Crime Act 2002 (the POC Act). The bill seeks to
provide that property will be considered to become 'proceeds' or an
'instrument' (and therefore be liable to being restrained or forfeited under
the POC Act) where proceeds or instruments of crime are used to make
improvements on property, service mortgage repayments on property and/or
service loans taken out in relation to property.[53] It also introduces a definition of 'improvements' to clarify that where
proceeds or instruments are used to renovate property, demolish structures, or
repair or maintain assets, the property will become 'proceeds' or an
'instrument'.[54]
2.122
The bill also seeks to provide that wealth or property will only be
'lawfully acquired' (and therefore not liable to restraint, freezing or
forfeiture) in situations where property or wealth is not 'proceeds' or an
'instrument' of an offence.[55] The explanatory memorandum explains that this amendment would ensure a
court, when determining whether property is 'lawfully acquired', examines the
origins of property or wealth used to discharge securities or encumbrances or
to make improvements to property, as well as situations where property may be
gifted to another person.[56]
Compatibility of the amendments with
the right to a fair trial and the right to a fair hearing
2.123
The right to a fair trial and fair hearing is protected by articles 14
and 15 of the International Covenant on Civil and Political Rights (ICCPR).
The rights are concerned with procedural fairness, and encompass notions
of equality in proceedings, the right to a public hearing and the requirement
that hearings are conducted by an independent and impartial body. Specific
guarantees of the right to a fair trial in relation to a criminal charge
include the presumption of innocence,[57]
the right not to incriminate oneself,[58] and the guarantee against retrospective criminal laws.[59]
Previous committee comment on the
Proceeds of Crime Act
2.124
The committee has previously raised concerns that the underlying regime
established by the POC Act for the freezing, restraint or forfeiture of
property may be considered 'criminal' for the purposes of international human
rights law.[60] For example, a forfeiture order may be made against property where
(relevantly) a court is satisfied that the property is 'proceeds' of an
indictable offence or an 'instrument' of one or more serious offences.[61] The fact a person has been acquitted of an offence with which the person has been
charged does not affect the court's power to make such a forfeiture order.[62] Further, a finding need not be based on a finding that a
particular person committed any offence.[63] A finding that a
court is satisfied that the property is 'proceeds' of an indictable offence or
an 'instrument' of one or more serious offences appears to entail
'blameworthiness' or 'culpability' which the committee has previously
considered would suggest that the provisions may be criminal in character, and
therefore may engage criminal process rights which must be complied with in
order for the measures to be compatible with fair trial and fair hearing
rights.[64]
2.125
The committee has also previously noted:
...the POC Act was introduced prior to the establishment of the
committee and therefore before the requirement for bills to contain a statement
of compatibility with human rights. It is clear that the POC Act provides law
enforcement agencies important and necessary tools in the fight against crime
in Australia. Assessing the forfeiture orders under the POC Act as involving
the determination of a criminal charge does not suggest that such measures
cannot be taken – rather, it requires that such measures are demonstrated to be
consistent with the criminal process rights under articles 14 and 15 of the
ICCPR.[65]
2.126
The committee has previously recommended that the Minister for Justice
undertake a detailed assessment of the POC Act to determine its compatibility
with the right to a fair trial and right to a fair hearing. It is noted that in
his response to the committee's inquiries relating to the Law Enforcement
Legislation Amendment (State Bodies and Other Measures) Bill 2016, the
minister stated that he did not consider it necessary to conduct an assessment
of the POC Act to determine its compatibility with the right to a fair trial
and fair hearing as legislation enacted prior to the enactment of the Human
Rights (Parliamentary Scrutiny) Act 2011 is not required to be subject to a
human rights compatibility assessment, and the government continually reviews
the POC Act as it is amended. However, noting the concerns raised in relation
to the POC Act, it would be of considerable assistance if the POC Act were
subject to a foundational human rights assessment.
Compatibility of the amendments
2.127
The existing human rights concerns with the POC Act mean that any
extensions of the provisions in that Act by this bill may raise similar
concerns. In particular, as outlined in the initial analysis, applying a
broader basis on which a person's assets may be frozen, restrained or forfeited
to include property subject to a mortgage in which mortgage payments have been
serviced by illicit funds, without a finding of criminal guilt beyond
reasonable doubt, may limit the right to be presumed innocent and the
prohibition against double punishment should the POC Act provision be criminal
in nature. Further, several aspects of the bill operate retrospectively, which
may engage the absolute prohibition against retrospective punishment in
criminal proceedings.[66]
2.128
The statement of compatibility states that the POC Act is civil in
character, and on this basis the criminal process rights do not apply.[67] However, as noted in the committee's Guidance Note 2, the term
'criminal' has an autonomous meaning in international human rights law, such
that even if a penalty or other sanction is classified as civil in character
domestically it may nevertheless be considered 'criminal' for the purposes of
international human rights law.[68]
2.129
In addition to the domestic classification of the offence, the
committee's Guidance Note 2 explains that two other relevant factors in
determining whether the provisions should be characterised as 'criminal' in
character concern the nature and purpose of the measure and the severity of the
penalty. The purpose of the bill is described in the statement of compatibility
as to ensure that proceeds of crime authorities can restrain and confiscate
property or wealth in certain circumstances, so that 'criminals are not able to
deliberately restructure their affairs to avoid the operation of the Act and
retain their ill-gotten gains'.[69] The broader purpose of the POC Act is outlined in section 5 of the Act and
includes to punish and deter persons from breaching laws. The initial analysis
noted that this raises concerns that the freezing, restraint or forfeiture
proceedings that are expanded by the bill may be characterised as a form of
punishment.[70] As to the severity of the penalty, it was noted that the freezing, restraint or
forfeiture orders can involve significant sums of money, which raises concerns
that the cumulative effect of the purpose and severity of the measures would
lead to the provisions being characterised as 'criminal'.
2.130
If the provisions were to be characterised as 'criminal' for the
purposes of human rights law, this does not mean that the provisions are
necessarily illegitimate, nor does it convert the provisions into a criminal
offence in domestic law. Rather, it means that the provisions in question must
be shown to be consistent with the criminal process guarantees set out in
Articles 14 and 15 of the ICCPR, including any justifications for any
limitations of these rights.
2.131
The committee therefore sought
the advice of the minister as to whether these amendments to the POC Act are
compatible with these rights, including:
- By reference to the committee's Guidance
Note 2, whether the freezing, restraint or forfeiture powers that are
broadened by the amendments to the definitions of 'proceedings' and an
'instrument' in the bill may be characterised as 'criminal' for the purposes of
international human rights law, having regard to the nature, purpose and
severity of those powers; and
- The extent to which the
provisions are compatible with the criminal process guarantees set out in
Articles 14 and 15, including any justification for any limitations of these
rights where applicable.
2.132
As the POC Act was introduced
prior to the establishment of the committee and no statement of compatibility
was provided for that legislation, the committee recommended in its Report
12 of 2017 that the minister undertake a detailed assessment of the POC Act
to determine its compatibility with the right to a fair trial and right to a
fair hearing. This would inform the committee's consideration of the
compatibility of the amendments in the context of the legislative scheme as a
whole.
Minister's response
2.133
In relation to whether the amendments may be characterised as civil or
criminal for the purposes of international human rights law, the minister's
response analyses the POC Act in light of Guidance Note 2 and considers the
freezing, restraint or forfeiture powers that are broadened by the amendments
to the definitions of 'proceedings' and an 'instrument' in the bill should not be
characterised as 'criminal' for the purposes of international human rights law.
The minister's response states:
On the first criterion, it is clear that asset recovery
actions, including those under the unexplained wealth regime, are characterised
as civil in nature under Australian domestic law.
On the second criterion, the Proceeds of Crime Act 2002 (POC Act) is not solely focused on deterring or punishing persons for breaching
laws, but is primarily focused on remedying the unjust enrichment of criminals
who profit at society's expense. Actions under the POC Act also make no
determination of a person's guilt or innocence and can be taken against assets
without a finding of any form of culpability against a particular individual.
On the third criterion, Guidance Note 2 provides that a
penalty is likely to be considered criminal for the purposes of human rights
law if the penalty is imprisonment or a substantial pecuniary sanction.
Proceedings under the POC Act cannot in themselves create any criminal
liability and do not expose people to any criminal sanction (or a subsequent
criminal record). Further, penalties under the POC Act cannot be commuted into
a period of imprisonment.
On whether the sanction is substantial, it also remains open
to a court to decrease the quantum to be forfeited under the Act to accurately
reflect the quantum that has been derived or realised from crime, ensuring that
orders are aimed primarily at preventing the retention of ill-gotten gains,
rather than the imposition of a punishment or sanction.
2.134
While the POC Act cannot in itself create criminal liability under
domestic law, as noted in the initial analysis, the broader purpose of the POC
Act is outlined in section 5 of the Act and includes to punish and deter
persons from breaching laws, which raises concerns that the freezing, restraint
or forfeiture proceedings that are expanded by the bill may be characterised as
a form of punishment. Further, while it remains open to a court to decrease the
quantum to be forfeited, it remains the case that significant sums of money may
be frozen, restrained or forfeited, raising concerns that the cumulative effect
of the purpose and severity of the measures would lead to the provisions being
characterised as 'criminal'.
2.135
In relation to the committee's recommendation that the minister undertake
a detailed assessment of the POC Act to determine its compatibility with the
right to a fair trial and right to a fair hearing, the minister's response
states:
I note this recommendation and reiterate my previous comments
as outlined at paragraph 1.115 of the Committee's report, namely that
legislation established prior to the enactment of the Human Rights
(Parliamentary Scrutiny) Act 2011 is not required to be subject to a human
rights compatibility assessment. The Government continually reviews the POC Act
to ensure that it addresses emerging trends in criminal conduct and will
continue to undertake a human rights compatibility assessment when developing
Bills to amend the Act.
2.136
In light of the committee's previously raised concerns about the
sufficiency of safeguards in the POC Act to protect the right to a fair trial
and the right to a fair hearing, in order to fully assess the compatibility of
the proposed measures it is necessary for a detailed assessment of the POC Act
in respect of these concerns to be undertaken.
Committee response
2.137
The committee thanks the minister for his response and has
concluded its examination of this issue.
2.138
The committee notes that the amendments to the definitions of
'proceedings' and an 'instrument' in the bill have the effect of broadening the
circumstances in which a person's assets may be subject to being frozen,
restrained or forfeited under the POC Act.
2.139
The committee reiterates its earlier comments that the proceeds of crime
legislation provides law enforcement agencies with important and necessary
tools in the fight against crime. However, the amendments also raise concerns
regarding the right to a fair hearing and the right to a fair trial, as
although the regime established by the POC Act for the freezing, restraint or
forfeiture of property is classified as civil or administrative under domestic
law, its content may nevertheless be considered 'criminal' under international human
rights law.
2.140
The committee reiterates its previous view that the POC Act would benefit
from a full review of the human rights compatibility of the legislation.
Compatibility of the measure with
the right to privacy
2.141
The right to privacy includes the right not to be subject to arbitrary
or unlawful interference with a person's privacy, family, home or
correspondence. As noted in the statement of compatibility, the amendments to
the bill may engage and limit the right not to be subject to arbitrary or unlawful
interference with a person's home, as the amendments affect orders that can be
used to restrain and forfeit real property.[71]
2.142
The right to privacy may be subject to permissible limitations which are
provided by law and are not arbitrary. In order for limitations not to be
arbitrary, the measure must pursue a legitimate objective, and be rationally
connected and proportionate to achieving that objective.
2.143
As noted earlier, the objective of the bill is stated to be to ensure
that criminals are not able to restructure their affairs to avoid the operation
of the proceeds of crime legislation.[72] This would appear to be a legitimate objective for the purposes of
international human rights law, and the measures would appear to be rationally
connected to that objective.
2.144
In relation to the proportionality of the measure, the statement of
compatibility outlines several safeguards and protections in place to protect
individuals whose property may be subject to other orders affected by the
amendments in the bill. This includes, where a person's property is subject to
a restraining order, a court may be able to make allowances for expenses to be
met out of property covered by the restraining order,[73] or refuse to make an order where it is not in the public interest to do so.[74] Property will also cease to be 'proceeds' of an offence or an 'instrument' of
an offence in certain circumstances, including if it is acquired by a third
party for sufficient consideration without the third party knowing, and in
circumstances that would not arouse reasonable suspicion, that the property was
proceeds of an offence or an instrument of an offence.[75] A person may also seek a compensation order for the proportion of the value of
the property they did not derive or realise from the commission of an offence.[76]
2.145
Notwithstanding these safeguards, the initial analysis noted that a
person may still be liable for their property to be forfeited where a person
has been acquitted of an offence, or where their conviction has been
subsequently quashed.[77] This appears to leave open the possibility that a person may be acquitted of an
offence, but nonetheless be liable to have their real property forfeited
because they have made mortgage payments, or made improvements on that
property, using funds that the court considers on the balance of probabilities
are 'proceeds' from that offence.[78] There does not appear to be a safeguard in place to allow the court to
revoke the forfeiture order upon an acquittal. The initial assessment stated
that this raises questions both as to whether there are adequate safeguards in
place to protect a person's home as well as whether the amendments are the
least rights-restrictive means of achieving the objective.
2.146
The committee therefore sought
the advice of the minister as to whether the limitation on the right to privacy
is proportionate to the objective of the measure (including whether there are
adequate safeguards in place to protect persons' property from being forfeited
where they have been acquitted of the offence, and whether there are other
less-rights restrictive means of achieving the objective).
Minister's response
2.147
In response, the minister provided the following information:
This concern... only arises in relation to non-conviction based
forfeiture orders under the POC Act. This method of forfeiture is specifically
designed to allow proceeds authorities to seize and forfeit property where they
can establish a link to criminal conduct on the balance of probabilities (the
civil standard of proof). This system of forfeiture functions independently of
any criminal finding of guilt, which is established on the higher standard of
'beyond reasonable doubt'.
The Australian Law Reform Commission previously recommended
the adoption of a non-conviction based forfeiture regime in its review of the Proceeds
of Crime Act 1987, which found that the previous system of conviction-based
forfeiture was ineffective at confiscating criminal assets and undermining the
profitability of criminal enterprises.
As noted in the Explanatory Memorandum to the Bill, the Act
already contains safeguards and protections that ensure the measures are no
more onerous than necessary to achieve their objectives. I also note that the
civil forfeiture orders under the Act make no determination of a person's guilt
or innocence and impose no criminal penalties upon an individual. Allowing
these orders to be revoked where it is found that a person did not commit an
offence beyond reasonable doubt, as is the case with an acquittal, would
therefore be inappropriate and counterproductive to the underlying aims of
non-conviction based forfeiture.
2.148
As noted earlier, the objective of confiscating criminal assets is an
important objective and the proceeds of crime legislation provides law
enforcement agencies with important and necessary tools in the fight against
crime. However, the effect of a non-conviction based forfeiture order where a
person has been acquitted of an offence is that a person may have their
property seized even though they have been found not to have committed a crime
by the criminal justice system. This raises concerns as to the compatibility of
this measure with the right not to be arbitrarily subjected to interferences
with a person's home. As noted in the previous analysis, in light of the
committee's previously raised concerns about the sufficiency of safeguards in
the POC Act, in order to fully assess the compatibility of the proposed
measures it is necessary for a detailed assessment of the POC Act in respect of
these concerns to be undertaken.
Committee response
2.149
The committee thanks the minister for his response and has
concluded its examination of this issue.
2.150
The preceding analysis raises concerns as to the compatibility of
the measure with the right to privacy, in particular, the right not to be
arbitrarily subjected to interferences with a person's home. This is because a
non-conviction based forfeiture order may apply to a person's real property
because a person has made mortgage payments, or made improvements on that
property, using funds that the court considers on the balance of probabilities
are 'proceeds' from that offence, notwithstanding that a person has been
acquitted of an offence to the criminal standard of proof.
2.151
The committee reiterates its previous view that the POC Act would
benefit from a full review of the human rights compatibility of the
legislation.
Amendments to the unexplained wealth regime
2.152
The POC Act also currently requires a court to make an 'unexplained
wealth'[79] order where (relevantly) the court is not satisfied that the whole or any part
of the person's wealth was not 'derived from' one or more relevant offences.[80] The bill seeks to amend the POC Act so that it additionally covers wealth that
is 'derived or realised, directly or indirectly' from certain offences. In
particular, the bill would amend section 179E of the POC Act to provide that an
unexplained wealth order must be made where the court is not satisfied the
whole or any part of a person's wealth is not 'derived or realised, directly or
indirectly' from the commission of certain offences.[81] According to the statement of compatibility, this would align the unexplained
wealth provisions with the revised definition of 'proceeds' and an
'instrument', discussed above. The burden of proving that a person's wealth is
not derived or realised, directly or indirectly, from one or more of the
relevant offences would lie on the person against which an order is being
sought.[82]
Compatibility of the amendments to
the unexplained wealth regime with the right to a fair trial and the right to a
fair hearing
2.153
The committee has previously commented on the human rights compatibility
of the unexplained wealth regime. In those reports, the committee raised
concerns that the unexplained wealth provisions in the POC Act may involve the
determination of a criminal charge, and that the operation of the reverse
burden placed on a respondent effectively gives rise to a presumption of
unlawful conduct, which may constitute a significant limitation on the right to
be presumed innocent until proven guilty (if the POC Act were to be considered
criminal for the purposes of international human rights law).[83] Concerns have also been raised insofar as a preliminary unexplained wealth
order may be made against a person who does not appear at hearing, and so may
not have an opportunity to be heard.[84] The amendments to the unexplained wealth regime, which broaden the basis on
which unexplained wealth orders may be made, means that those matters raised in
previous analyses are of equal relevance here. It is also noted that these
amendments are intended to operate retrospectively to a degree,[85] which additionally raises the issue of compatibility of the amendments with the
absolute prohibition on retrospective criminal laws.
2.154
As discussed above in relation to the amendments to the definitions of
'proceeds' and an 'instrument', relevant factors in determining whether a
measure is characterised as 'criminal' in nature are the domestic
characterisation of the measure, the nature and purpose of the measure and the
severity of the measure.[86] As the minister considers that the measures are not criminal in nature
based on the domestic characterisation of the measure, no explanation is
provided as to whether the measure is criminal by reference to the nature,
purpose and severity of the measure, and further whether any potential
limitations on fair trial and fair hearing rights are permissible.
2.155
The committee therefore sought
the advice of the minister as to whether these amendments are compatible with
fair trial and fair hearing rights, including:
- By reference to the committee's Guidance
Note 2, whether the proposed amendments to the unexplained wealth regime in
the bill may be characterised as 'criminal' for the purposes of international
human rights law, having regard to the nature, purpose and severity of the
measures; and
- The extent to which the
amendments are compatible with the criminal process guarantees set out in
Articles 14 and 15, including any justification for any limitations of these
rights where applicable.
Minister's response
2.156
The minister's response answered these queries together with the
identical queries raised regarding the amendments to the definition of
'proceeds' and an 'instrument'. This response was discussed and analysed at [2.133]
to [2.136] above, and the same analysis applies in the context of the
unexplained wealth regime.
Committee response
2.157
The committee thanks the minister for his response and has
concluded its examination of this issue.
2.158
The committee notes that the amendments to the unexplained wealth regime
raise concerns regarding the compatibility of the measure with the right to a
fair hearing and the right to a fair trial. The committee reiterates its
previous view that the POC Act would benefit from a full review of the human
rights compatibility of the legislation.
Social Services Legislation Amendment (Housing Affordability) Bill 2017
Purpose |
Seeks to amend the Social
Security (Administration) Act 1999, Social Security Act 1999 and A New
Tax System (Family Assistance) (Administration) Act 1999 to incorporate a
scheme for automatic deduction of rent and other household payments from
social security or family tax benefit payments of tenants in social housing |
Portfolio |
Social Services |
Introduced |
House of Representatives,
14 September 2017 |
Rights |
Multiple Rights (see Appendix
2) |
Previous report |
12 of 2017 |
Status |
Concluded examination |
Background
2.159
The committee first reported on the Social Services Legislation
Amendment (Housing Affordability) Bill 2017 (the bill) in its Report 12 of
2017, and requested a response from the Minister for Social Services by 13
December 2017.[87]
2.160
The minister's response to the committee's inquiries was received on
11 December 2017. The response is discussed below and is reproduced in full at Appendix 3.
Automatic deduction of rent and housing payments from social security or
family tax benefit payments
2.161
The bill seeks to amend the Social Security (Administration) Act
1999, Social Security Act 1999 and A New Tax System (Family Assistance)
(Administration) Act 1999 to introduce an automatic rent deduction scheme
(ARDS). ARDS is a scheme for tenants in social (public or community) housing
for the automatic deduction of rent and other household payments from the
tenants' social security or family tax benefit payments.
2.162
The bill provides that a social housing lessor (landlord) may request
the Secretary deduct an amount from a social housing tenant's 'divertible
welfare payment'[88] or family tax benefit to satisfy rent, household utilities or both that are
payable by the tenant.[89] The request can be made by the lessor to the Secretary in the following
circumstances:
- both of the following apply:
- the tenant has an
ongoing or outstanding obligation to pay an amount for rent, household
utilities, or both, in relation to the tenant’s occupancy of premises let by
the lessor;
- the tenant's agreement
with the lessor for occupancy of the premises, or another written agreement with
the lessor, authorises the lessor to make requests under this Part for
deductions from divertible welfare payments payable to the tenant; or
- the tenant is to pay to the lessor an amount for
loss of, or damage to, property, as a result of the tenant’s occupancy of
premises let by the lessor so as to comply with an order of a court, or of a
tribunal or other body that has the power to make orders, and either:
- the period for appealing
against the order ends without an appeal being made; or
- if an appeal is made
against the order—the appeal is finally determined or otherwise disposed of; or
- the tenant agrees, in writing, to pay to the lessor
an amount for loss of, or damage to, property, as a result of the tenant’s
occupancy of premises let by the lessor.[90]
2.163
A 'social housing tenant' is defined as a person who is 18 years or
older who pays, or is liable to pay, rent in relation to a premises let by a
social housing lessor, whether or not the person is named in the agreement with
the lessor for occupancy of the premises.[91] According to the explanatory memorandum, this definition will allow deductions
to be sought from the welfare payment of any of the adult occupants of the
house.[92]
Compatibility of the automatic rent
deduction scheme with multiple rights
2.164
The initial analysis stated that the ARDS engages and limits several
human rights, including:
- the right to social security;
- the right to an adequate standard of living;
-
the right to privacy;
- the right to protection of the family; and
- the right to equality and non-discrimination (see Appendix 2)
2.165
The ARDS raises similar issues against the right to social security, the
right to an adequate standard of living, the right to privacy and the right to
protection of the family. Distinct considerations arise in relation to the
right to equality and non-discrimination, which are discussed further below.
2.166
The right to social security recognises the importance of adequate
social benefits in reducing the effects of poverty and plays an important role
in realising many other economic, social and cultural rights. The Committee on
Economic, Social and Cultural Rights has noted that social security benefits
must be adequate in amount and duration having regard to the principle of human
dignity, so as to avoid any adverse effect on the levels of benefits and the
form in which they are provided.[93] Additionally, the right to an adequate standard of living in Article 11 of the International
Covenant on Economic, Social and Cultural Rights (ICESCR) requires Australia to
take steps to ensure the availability, adequacy and accessibility of food,
clothing, water and housing for all people in Australia. Under the Convention
on the Rights of the Child (CRC), children have the right to benefit from
social security and to a standard of living adequate for a child's physical,
mental, spiritual, moral and social development.[94] Additionally, Australia has obligations under Article 23 of the International
Covenant on Civil and Political Rights (ICCPR) and Article 10 of the ICESCR to
provide the widest possible protection and assistance to the family.
2.167
The right to privacy is linked to notions of personal autonomy and human
dignity. It includes the idea that individuals should have an area of
autonomous development; a 'private sphere' free from government intervention
and excessive unsolicited intervention by others. The right to privacy requires
that the state does not arbitrarily interfere with a person's private and home
life.
2.168
The initial analysis stated that the ARDS may limit these rights, as the
scheme limits social housing tenants' freedom and autonomy to make decisions
about the way in which their social security payments or family tax benefits
are used. The minister acknowledged in the statement of compatibility that
the right to social security, the right to an adequate standard of living, the
right to privacy, the right to protection of the family and the rights of
children are engaged and limited by the ARDS. However, in relation to the right
to privacy, the statement of compatibility only addressed the right to privacy
insofar as it related to the disclosure of personal information. The statement
of compatibility did not otherwise address the right to privacy, including the
extent to which the bill may interfere with a person's private and home life
through limiting affected persons' ability to choose the way in which their
social security or family tax benefits are used.
2.169
For a limitation on a human right to be permissible, it must pursue a
legitimate objective, be rationally connected to that objective, and be a
proportionate way to achieve that objective. The statement of compatibility
explained that the objective of ARDS is to prevent evictions due to arrears and
debt which may force a person, and their children, into homelessness.[95] The statement of compatibility further stated:
ARDS aims to:
- reduce
the risk that social housing tenants will accumulate rental arrears and other
housing debt risking their tenancies,
- reduce the cost of
managing social housing arrears and debt, and
- better secure the income
stream associated with housing assets.[96]
2.170
A legitimate objective is one that is necessary to address an area of
public and social concern, not one that simply seeks an outcome that is
regarded as desirable or convenient. The initial analysis stated that the
objective of reducing the risk of rental arrears, evictions and homelessness is
capable of constituting a legitimate objective for the purposes of
international human rights law.[97] However, where a measure may limit a human right, the committee's usual
expectation is that the accompanying statement of compatibility provides a
reasoned and evidence-based explanation of how the measure supports a
legitimate objective.[98] In this instance, no evidence was provided in the statement of compatibility as
to the extent to which rental arrears in the social housing sector is a
pressing issue.
2.171
The statement of compatibility noted that, in most jurisdictions, social
housing tenants have a condition in their lease to use a voluntary rent
deduction scheme to pay housing tenancy costs, and that tenancy tribunals may
order defaulting tenants to use the voluntary rent deduction scheme. It stated
that under the present scheme tenants may 'bypass their social housing provider
and cancel their authorised tenancy tribunal ordered voluntary rent deductions'
due to social security payments and family tax benefits being 'absolutely
inalienable' under the existing law.[99] However, no evidence was provided as to the extent to which tenants have
engaged in 'bypassing' of tribunal orders, and no evidence was provided to
explain the extent to which the existing scheme of voluntary rent deduction is
ineffective to address the stated objective of reducing the risk of rental
arrears, evictions and homelessness.
2.172
The statement of compatibility stated that people subject to the ARDS
will benefit by way of a reduction in their liability to a social housing
lessor, and that the scheme is designed to ensure persons continue to enjoy an
adequate standard of living (including housing) by reducing the risk of arrears
build-up which may lead to eviction and possible homelessness.[100] It further stated that by preventing rental arrears and possible eviction, the
bill will assist a person's capacity to meet the basic needs of his or her
family and protects the rights of children.[101] On these bases, the statement of compatibility argued that the measures are
compatible with the rights to social security, an adequate standard of living,
protection of the family and the rights of children.
2.173
However, the initial analysis stated that the application of the ARDS to
persons with an 'ongoing or outstanding obligation'[102] to pay rent or housing utilities suggests that the scheme may apply to tenants
with ongoing obligations to pay rent regardless of whether or not they are in
rental arrears. This may result in tenants having limitations placed on their
social security payments or family tax benefits, even in circumstances where
they may not need assistance managing rental payments or payment of household
utilities. The initial analysis stated that it was not clear how applying the
scheme to persons in such circumstances was rationally connected to the
objective of reducing risk of evictions and homelessness, as such persons may not
be at risk. On the contrary, there may be a risk that the imposition of the
ARDS on persons who are not at risk could encourage welfare dependency by
reducing a person's independent financial management capabilities.
2.174
Similarly in relation to the proportionality of the measure, the initial
analysis stated the application of the ARDS to persons with an ongoing (but not
an outstanding) obligation to pay rent did not appear to be the least
rights-restrictive means of achieving the objectives of reducing the risk of
rental arrears, evictions and homelessness. There appeared to be other less
rights-restrictive means of achieving these objectives, including limiting the
scheme to persons who have an outstanding obligation to pay rent, or have a
demonstrated risk of falling into rental arrears that is determined by
reasonable and objective criteria, for example because the person may have
fallen into rental arrears on several previous occasions.
2.175
In its 2016 Review of Stronger Futures Measures,
the committee commented that income management is most effective when it
is voluntary, or when it is applied to individuals after considering their
particular circumstances – that is, when it is applied flexibly.[103] The committee also raised concerns that compulsory income management provisions
which operate inflexibly raise the risk that the regime would be applied to
people who did not need assistance managing their budget.[104] The initial analysis of the present bill noted that the bill does not appear to
include any requirement that a social housing lessor or the Secretary consider
an individual's particular circumstances, beyond the requirement that a tenant
has ongoing or outstanding obligation to pay rent and authority under the
tenant's lease for the lessor to make the request. For example, there does not
appear to be any requirement (discretionary or otherwise) for the Secretary to
consider a tenant's personal circumstances, such as whether the imposition of
the ARDS would cause hardship, in determining whether a deduction should be
made following a request from a lessor.[105] This raised concerns that the measure may not provide sufficient flexibility to
treat different cases differently having regard to the merits of an individual
case.
2.176
The initial analysis stated that the absence of any discretion to
consider a tenant's personal circumstances raised particular concerns in
relation to the right to protection of the family and the rights of children.
If, for example, the timing of the automatic rent deduction was such that it
made it difficult for a parent to pay for other necessities in circumstances of
financial stress, this could affect the standard of living of children under
the tenant's care. This raised additional questions about the proportionality
of the measure to the protection of the family and the rights of the child.
2.177
The committee therefore sought the advice of the minister as to:
- whether there is reasoning or
evidence that establishes that the stated objective addresses a pressing or
substantial concern or whether the proposed changes are otherwise aimed at
achieving a legitimate objective (including any evidence of the extent to which
the existing scheme of voluntary rent deduction is ineffective);
- how the automatic rent deduction
scheme is effective to achieve (that is, rationally connected to) that
objective (including its potential application to those who are not and have
not been in rental arrears); and
- whether the automatic rent
deduction scheme is a proportionate limitation on these rights, in particular
whether applying the scheme described in paragraph [2.162] above to both
ongoing and outstanding obligations to pay rent is the least rights-restrictive
means of achieving the stated objective, and whether the scheme provides
sufficient flexibility to treat different cases differently.
Minster's response
2.178
In relation to whether the stated objective addresses a pressing or
substantial concern, the minster's response states:
Rent arrears and a failure to pay other tenancy charges is
the single most significant tenancy management issue facing social housing
providers nationally. The impact of failed social housing tenancies due to rent
arrears is significant-including the direct impact of exits into homelessness
and the longer-term impacts of housing instability (particularly in terms of
continuity of support arrangements; employment opportunities and school
attendance for children).
State and territory governments estimate that the social
housing system is losing more than $30 million annually from unpaid rent and
administrative costs. This places an additional and unnecessary burden on the
already financially strained public housing system.
The current Rent Deduction Scheme (RDS) is voluntary and easy
to bypass. This is because arrangements can be cancelled by the tenant without
the housing provider's knowledge, which can lead to increasing rental arrears
and eventual eviction.
For example in 2013-14, around 80,000 households in social
housing stopped their voluntary deductions at some time during the year which
put them at greater risk of falling behind in their rent.
Social housing tenants not paying their rent can also put
pressure on local support and homelessness services.
2.179
The minister's response also addresses the effectiveness of the current
voluntary rent deduction scheme:
In 2013-14, more than 8,900 social housing tenants, including
families with children, were in serious rental arrears, with more than 2,300
people evicted due to rent defaults. In NSW, during the same period, over 80
per cent of those evicted due to serious rental arrears had previously
participated in the current voluntary Rent Deduction Scheme (RDS) but had then
cancelled. If an ARDS were in place, this group would have been unable to
cancel their payment. This strongly suggests that ARDS would be effective in
reducing tenancy eviction rates.
2.180
Based on the further information provided by the minister, it is likely
that the ARDS addresses a pressing and substantial concern for the purposes of
international human rights law.
2.181
The minister's response further explains that the ARDS will improve the
operational efficiency of social housing, by ensuring social housing providers
receive rent from tenants on time, including from those tenants who
consistently fail to pay. The minister's response further explains that:
Tenants have a legal obligation to pay rent as part of their
tenancy agreements with their relevant housing providers. The ARDS acts as both
a facility to enable the payment of these rents in a cost effective manner for
housing providers, and a seamless mechanism for the tenant to ensure that their
legal obligations are met.
...
ARDS recognises that social welfare payments should be used
towards a person's and their family's basic needs and is intended to support
security of tenure in housing. It also recognises that a person's home is an
important precondition to their ability to exercise their human rights and
their economic, social and cultural rights in particular.
2.182
In light of further information as to the level of arrears in the social
housing context, to the extent that the ARDS would apply to persons that have
an outstanding obligation to pay rent, the scheme appears to be
rationally connected to the objective of reducing the risk of homelessness
insofar as it could reduce tenancy eviction rates by preventing rental arrears
from occurring.
2.183
However, the minister's response does not overcome the committee's
specific concerns that the application of the ARDS to persons with an ongoing (but not an outstanding) obligation to pay rent does not appear to be
rationally connected to the objective of reducing the risk of evictions and homelessness.
This is because persons in such circumstances may not be at risk of eviction.
This is also relevant to whether the limitation is proportionate, as concerns
remain that tenants may have limitations placed on their social security and
family tax benefits in circumstances where they pose no risk of falling into
arrears. It would appear that a less rights-restrictive means of achieving the
objective would include only applying the scheme to persons who have an
outstanding obligation to pay rent, or have a demonstrated risk of falling into
rental arrears that is determined by reasonable and objective criteria (such as
previously falling into arrears).
2.184
As to the safeguards that are in place to consider individual
circumstances, the minister's response explains that states and social housing
providers are responsible for tenancy management and 'they would continue to
retain responsibility and flexibility for tenancy management and rent setting
policies', such as deciding to which of their occupants of properties covered
by a current lease ARDS should apply. The minister's response further explains:
If a tenant is not able to resolve their concerns regarding
an Automatic Rent Deduction Scheme (ARDS) deduction with their housing provider
or a State based Review Body, they could approach the Department of Human
Services (DHS). If it is a matter where the Commonwealth has responsibility,
DHS and the Department of Social Services would monitor such requests for
review as part of their usual business operations.
The Secretary (or their delegate) also has the power to
intervene and make a decision as to whether a deduction is made and the amount
deducted. Policy guidelines will also be developed following the passing of the
Bill, which will provide further clarity on the operation of ARDS.
In addition, deductions under the scheme will stop as soon as
the person is no longer living in public or community housing covered by a
current lease.
An ARDS is designed to work alongside government funded
financial counselling and other available support services, to ensure that
tenants continue to be housed safely and affordably while they get the help
they need to sustain their tenancy.
2.185
While the minister's response provides information about the avenues
that may be pursued by persons who have concerns over the operation of the
scheme, it remains unclear whether sufficient safeguards are in place to
accommodate tenants' individual circumstances. This includes whether the
automatic deduction of rent would increase financial hardship or would operate
in a manner that prevented a person having funds available to meet other basic
and reasonable needs. In relation to the Secretary's power to intervene and
make a decision as to whether a deduction is made, it is also not clear whether
that power includes a discretion to consider matters beyond the requirement
that a tenant has ongoing or outstanding obligation to pay rent and authority
under the tenant's lease for the lessor to make the request. While the
minister's response indicates that policy guidance will be provided in relation
to the operation of the ARDS, this is less stringent than the protection of
statutory processes. This is because such guidance can be removed, revoked or
amended at any time and is not required as a matter of law. Therefore, based on
the information provided, it is not possible to conclude that the safeguards
referred to by the minister overcome the concerns that the blanket operation of
the scheme may not provide sufficient flexibility to have regard to an
individual's particular circumstances.
Committee response
2.186
The committee thanks the minister for his response and has
concluded its examination of this issue.
2.187
Notwithstanding the legitimate objective of the bill, the preceding
analysis indicates that the automatic rent deduction scheme may be incompatible
with the right to social security, the right to an adequate standard of living,
the right to privacy, the right to protection of the family and the rights of
children. This is because:
- the application of the scheme to persons with an ongoing (but not
an outstanding) obligation to pay rent does not appear to be rationally
connected or proportionate to the stated objective of the bill of reducing the
risk of rental arrears and homelessness; and
- the bill does not appear to provide sufficient flexibility to have
regard to a tenant's individual circumstances.
The right to equality and
non-discrimination
2.188
The right to equality and non-discrimination is protected by the ICCPR
and the ICESCR. It provides that everyone is entitled to enjoy their rights
without discrimination of any kind, and that all people are equal before the
law and entitled without discrimination to the equal and non-discriminatory
protection of the law.
2.189
'Discrimination' refers to a distinction based on a personal attribute
(for example, race, sex, or religion) which has either the purpose (called
'direct' discrimination) or the effect (called 'indirect' discrimination) of
adversely affecting human rights. The UN Human Rights Committee has explained
indirect discrimination as 'a rule or measure that is neutral on its face or
without intent to discriminate', which exclusively or disproportionately
affects people with a particular personal attribute.[106]
2.190
Demographic information published by the Australian Institute of Health
and Welfare in July 2017 states that in social housing households, the majority
of tenants were female (62%) and that 43% reported a disability, although only
29% identified a disability support pension as their main source of income.[107] Similarly in state-owned and managed
Indigenous housing, approximately three quarters of tenants were female (76%)
and 34% of tenants reported having a disability. In community housing
households, 57% of tenants were female with more than one-third (35%) reporting
having a disability.[108]
2.191
The initial analysis noted that the statement of compatibility does not
acknowledge that the right to equality and non-discrimination is engaged or
limited by the bill. However, the information in the preceding paragraph
indicates that the ARDS may have a disproportionate impact on women and persons
with a disability. Where a measure impacts on particular groups disproportionately
it establishes prima facie that there may be indirect discrimination.[109]
2.192
Differential treatment (including the differential effect of a measure
that is neutral on its face) will not constitute unlawful discrimination if the
differential treatment is based on reasonable and objective criteria such that
it serves a legitimate objective, is rationally connected to that legitimate
objective and is a proportionate means of achieving that objective. For the
reasons stated earlier, no evidence is provided in the statement of
compatibility as to whether the existing scheme is ineffective to address the
stated objective of reducing the risk of rental arrears, evictions and
homelessness. This raises questions as to whether the measure is based on reasonable
and objective criteria to justify the disproportionate impact this measure may
have on women and persons with a disability. Information to justify the
rationale for the differential effect on women and persons with a disability
will also be relevant to the proportionality analysis.
2.193
The committee therefore
sought the advice of the minister as to the compatibility of the automatic rent
deduction scheme with the right to equality and non-discrimination.
Minster's response
2.194
In response, the minister provides the following information:
An ARDS is not discriminatory; it is a mechanism available
for social housing providers to use to ensure rent is paid when it is due. It
is a matter for housing providers to determine to which tenants ARDS will
apply.
An ARDS will assist tenants by ensuring that they are able to
honour rent and other household costs associated with tenancy obligations they
have entered into.
The intent of this measure is to improve longer-term housing
stability and reduce the risk of homelessness. ARDS may therefore have a
comparatively larger positive impact on women and persons with a disability as
they are most likely to be overrepresented in social housing.
2.195
As noted earlier, a measure that is neutral on its face or without
intent to discriminate may constitute indirect discrimination where a measure
disproportionately affects people with a particular personal attribute. As
noted by the minister in his response, women and persons with a disability are
most likely to be overrepresented in social housing. In light of the
demographic information [2.190] above, it appears that the ARDS may have a
disproportionate impact on women and persons with a disability and therefore
constitutes indirect discrimination.
2.196
As discussed above, the minister has provided further information as to
the effectiveness of the existing scheme and the legitimate objective of the
ARDS. The minister has also identified that the scheme may positively impact
women and persons with a disability as it will reduce their risk of
homelessness.
2.197
However, the concerns discussed above in relation to the application of
the scheme to persons with an ongoing obligation to pay rent are equally relevant
in ascertaining whether the discrimination would be unlawful. By applying the
scheme to persons with an ongoing (but not an outstanding) obligation to pay
rent, there is a risk that the scheme may restrict social housing tenants' (of
which women and persons with a disability are overrepresented) social security
payments and family tax benefits in circumstances where those persons are not
at risk of falling into arrears. There appear to be other, less
rights-restrictive, measures available, such as applying the scheme only to
those persons who are at risk. The minister has not provided information as to
any reasonable and objective criteria to justify the disproportionate impact
the measure may have on women and persons with a disability.
Committee response
2.198
The committee thanks the minister for his response.
2.199
The committee is unable to conclude that the measure is
compatible with the right to equality and non-discrimination.
Amendments to the trial of the cashless welfare arrangements
2.200
Part 3D of the Social Security (Administration) Act 1999 provides
for the trial of cashless welfare arrangements. The trial permits certain
welfare payments to be divided into 'restricted' and 'unrestricted' portions,
with recipients being unable to spend the restricted portions of such payments
on alcohol or gambling.[110] Currently, section 124PM provides that a person who receives a 'restrictable
payment'[111] may use the restricted portion of the payment to purchase goods or services
other than alcohol beverages or gambling, and 'may use the unrestricted portion
of the payment, as paid to the person, at the person’s discretion'.
2.201
Item 7 of the bill proposes to repeal section 124PM and substitute it
with the following provision:
A person who received a restrictable payment may use the
restricted portion of the payment, as paid under subsection 124PL(2), to
purchase goods or services, other than alcoholic beverages or gambling.
2.202
The effect of this amendment, according to the explanatory memorandum,
would be to allow for automatic rent deductions 'to be made from the
unrestricted portion of a cashless debit card participant's welfare payment, if
necessary'.[112]
Compatibility of the amendments to
the cashless welfare arrangements with the right to equality and
non-discrimination
2.203
The committee has previously commented on the human rights compatibility
of the cashless welfare arrangements.[113] The committee has also examined the income management regime in its 2013 and
2016 Reviews of the Stronger Futures measures.[114] Those reports noted that the cashless welfare arrangements engage and limit
several human rights, including the right to social security, the right to
privacy and family and the right to equality and non-discrimination.
2.204
The initial assessment stated that, in allowing for automatic rent
deductions to be made from the unrestricted portion of a cashless debit card
participant's welfare payment, the bill appears to further restrict how a
person subject to the cashless welfare regime may spend their social security
payment or family tax benefit. It appears, for example, that a possible outcome
of rent being automatically deducted from the unrestricted portion of a
person's welfare payment is that a cashless welfare participant could have no
amount of their unrestricted welfare payment remaining. That is, the amendment
to section 124PM appears to leave open the possibility that no portion, or only
a small portion, of a cashless welfare participant's welfare payment could be
used at the person's discretion.
2.205
The issues raised in the previous section relating to the automatic rent
deduction scheme apply equally to the amendments to the cashless welfare
arrangements.[115] Further, the amendments to the cashless welfare regime raise additional issues
in relation to the right to equality and non-discrimination. This is because,
as the committee has previously commented, while the cashless welfare scheme
does not directly discriminate on the basis of race, Indigenous people are
disproportionately affected by the cashless welfare regime in the locations
where the scheme currently operates.[116]
2.206
As noted earlier, differential treatment (including the differential
effect of a measure that is neutral on its face) will not constitute unlawful
discrimination if the differential treatment is based on reasonable and
objective criteria such that it serves a legitimate objective, is rationally
connected to that legitimate objective and is a proportionate means of
achieving that objective.
2.207
The minister does not acknowledge that the amendments to the cashless welfare
regime introduced by the bill engage and limit the right to equality and
non-discrimination. However, as noted earlier, measures that disproportionately
impact particular groups establish prima facie that there may be
indirect discrimination. In addition to the concerns raised at [2.175] above in
relation to the ARDS, the particular impact on participants in the cashless
welfare scheme raises further questions as to the proportionality of the
measure.
2.208
Accordingly, the committee sought
the advice of the minister as to whether the amendments to the cashless welfare
arrangements introduced by the bill are compatible with the right to equality
and non-discrimination (including whether the measure pursues a legitimate
objective, is rationally connected to that objective and is a proportionate
limitation on the right).
Minster's response
2.209
The minister's response provides the following information in relation
to the amendments to the cashless welfare arrangements:
These amendments do not adversely affect CDC participants.
They simply provide consistency for all welfare recipients subject to
deductions such as the ARDS, regardless of whether they are also subject to the
CDC.
The amendments to allow the automatic deduction of rent where
a person is also subject to the cashless debit card (CDC) do not have a
negative effect on any CDC participants, including those that identify as
Aboriginal or Torres Strait Islander. The interaction between the ARDS and the
CDC program was considered carefully during drafting to ensure that CDC
participants were not disadvantaged by the introduction of the ARDS.
Generally, the amendments to cashless welfare provisions
(contained in Part 30 of the Social Security (Administration) Act 1999)
will allow for the automatic deduction of rent from the restricted portion of a
CDC participant's payment.
2.210
While the minister's response states that the amendments do not
adversely affect participants in the cashless welfare scheme, removing the
reference in current section 124PM to a person's ability to 'use the
unrestricted portion of the payment... at the person's discretion' would allow
for automatic rent deductions to be made from a person's previously unrestricted
portion of their welfare payment.[117] The bill therefore appears to further restrict how a person subject to the
cashless welfare regime may spend their social security or family tax benefit,
and may limit, or entirely preclude, a person's discretionary income if they
are subject to both the ARDS and the cashless welfare regime. As such, the
measure would appear to constitute a further limitation on the right to social
security and right to privacy.
2.211
Additionally, as the committee has previously noted in its analysis of
the cashless welfare regime,[118] Indigenous people are disproportionately affected by the cashless welfare
regime in the locations where the scheme currently operates. This aspect of the
bill therefore raises additional concerns in relation to the compatibility of
the measure with the right to equality and non-discrimination. However, the
minister has not provided any further information which directly addresses the
compatibility of the amendments to the cashless welfare regime with this right.
In light of the effect of the amendments on a person's discretionary income and
the committee's previous analyses of the cashless welfare regime, serious
concerns remain as to the compatibility of the amendments to the cashless
welfare regime with the right to equality and non-discrimination.
Committee response
2.212
The committee thanks the minister for his response and has
concluded its examination of this issue.
2.213
The effect of the amendments to the cashless welfare arrangements
would be to allow for automatic rent deductions to be made from the previously unrestricted
portion of a cashless debit card participant's welfare payment. This limits the
right to equality and non-discrimination, as Indigenous people are
disproportionately affected by the cashless welfare regime in locations where
the scheme currently operates.
2.214
In light of the effect of the amendments on a person's
discretionary income and the committee's previous analyses of the cashless
welfare regime,[119] the proposed amendments to the cashless welfare regime introduced by the bill
may be incompatible with the right to equality and non-discrimination.
Treasury Laws Amendment (Banking Executive Accountability
and Related Measures) Bill 2017
Purpose |
Seeks to amend the Banking
Act 1959 to establish the Banking Executive Accountability Regime and
provide the Australian Prudential Regulation Authority with strengthened
powers |
Portfolio |
Treasury |
Introduced |
House of Representatives,
19 October 2017 |
Rights |
Privacy; not to incriminate
oneself (see Appendix 2) |
Previous report |
12 of 2017 |
Status |
Concluded examination |
Background
2.215
The committee first reported on the Treasury Laws Amendment (Banking
Executive Accountability and Related Measures) Bill 2017 (the bill) in its Report
12 of 2017, and requested a response from the Treasurer by 13 December 2017.[120]
2.216
The Treasurer's response to the committee's inquiries was received on
14 December 2017. The response is discussed below and is reproduced in full at Appendix 3.
Coercive examination and information gathering powers
2.217
Schedule 2 of the bill seeks to amend the Banking Act 1959 to
provide the Australian Prudential Regulation Authority (APRA) with new
examination and information gathering powers. The powers include enabling APRA
to require a person to appear before an APRA-appointed investigator and
'provide all reasonable assistance in connection with the investigation' and to
require a person to produce books, accounts, documents or sign a record that may
be relevant to an investigator, regardless of whether the provision of such
information may incriminate the person.[121] Failure to comply with these requirements would be an offence and carry a
maximum penalty of 30 penalty units (currently $6,300).[122]
Compatibility of the measure with
the right not to incriminate oneself
2.218
Specific guarantees of the right to a fair trial in the
determination of a criminal charge guaranteed by article 14 of the International Covenant on Civil and Political Rights
(ICCPR) include the right not to incriminate oneself (article
14(3)(g)).
2.219
Schedule 2 of the bill engages and limits this right by requiring a
person to attend an examination, answer questions or provide books, accounts,
documents or sign a record notwithstanding that to do so might tend to
incriminate that person. The right not to incriminate oneself may be subject to
permissible limitations where the limitation pursues a legitimate objective, is
rationally connected to that objective and is a proportionate way of achieving
that objective.
2.220
The statement of compatibility acknowledges that the right not to
incriminate oneself is engaged by the bill, but states that the limitation on
this right is permissible on the following bases:
Engaging the right against self-incrimination in this way is
necessary and justified as the public benefit in removing the liberty outweighs
the loss to the individual. The information which would be obtained by APRA is
critical in it performing its regulatory functions, specifically protecting
depositors in an ADI [authorised deposit-taking institution], ensuring the
stability of Australia's financial system including through investigating
prudential matters.
2.221
While the broad objectives of protecting depositors and ensuring the
stability of Australia's financial system may be capable of constituting
legitimate objectives, the statement of compatibility provides no information
about the importance of these objectives in the specific context of the
measure. In order to demonstrate that the measure pursues a legitimate
objective for the purposes of international human rights law, a reasoned and
evidence-based explanation of why the measure addresses a substantial and
pressing concern is required.
2.222
Questions also remain as to whether the limitation is rationally
connected to and a proportionate means of achieving the objectives. In
particular, the availability of use and derivative use immunities can be an
important factor in determining whether the abrogation of the privilege against
self‑incrimination is proportionate. That is, they may act as a relevant
safeguard. The statement of compatibility states that a 'use' immunity would be
available.[123] This means that, where a person has been required to give
incriminating evidence, that evidence cannot be used against the person in any
civil or criminal proceeding, subject to exceptions,[124] but may be used to
obtain further evidence against the person.
2.223
However, no 'derivative use' immunity is provided in the
bill, which would prevent information or evidence indirectly obtained from
being used in criminal proceedings against the person. It is acknowledged that
a 'derivative use' immunity will not be appropriate in all cases because it is
not reasonably available as a less rights restrictive alternative. For example,
because it would undermine the purpose of the measure or be unworkable. However,
the statement of compatibility does not substantively address why a 'derivative
use' immunity would not be reasonably available in this case. This raises the
question as to whether the measure is the least rights restrictive way of
achieving the stated objective as required in order for the limitation to be
proportionate.
2.224
Further, it is noted that the availability or lack of
availability of a 'derivative use' immunity needs to be considered in the
regulatory context of the proposed powers. The extent of interference that may
be permissible as a matter of international human rights law may be, for
example, greater in contexts where there are difficulties regulating specific
conduct, persons subject to the powers are not particularly vulnerable or
powers are otherwise circumscribed with respect to the scope of information
which may be sought. That is, there is a range of matters which influence
whether the limitation is proportionate.
2.225
The committee therefore sought the advice of the Treasurer as to:
- whether there is reasoning or evidence that establishes that one
or more of the stated objectives addresses a pressing or substantial concern or
whether the proposed changes are otherwise aimed at achieving a legitimate
objective for the purposes of international human rights law;
- how the measure is effective to achieve (that is, rationally
connected to) that objective;
- whether the limitation is a reasonable and proportionate measure
to achieve the stated objective;
- whether the persons who may be subject to examination and the
scope of information that may be subject to compulsory disclosure is
sufficiently circumscribed with respect to the stated objective of the measure;
- whether a derivative use immunity is reasonably available as a
less rights restrictive alternative in proposed schedule 2 to ensure
information or evidence indirectly obtained from a person compelled by APRA to
answer questions or provide information or documents cannot be used in evidence
against that person.
Treasurer's response
2.226
The Treasurer's response explains that the limitation on the right not
to incriminate oneself is aimed at addressing a substantial concern:
...The concern is that APRA must be able to acquire or access
relevant information to ensure it can effectively investigate a prudential
matter relating to an Authorised Deposit-Taking Institution (ADI) which, in
turn, is likely to affect the ability of APRA to effectively perform its
regulatory functions and meet its broad objectives of protecting depositors and
ensuring the stability of Australia's financial system.
The evidence to support these provisions is that information
relevant to the prudential matters of an ADI is not always within the
possession, custody or control of the ADI. There are cases where information
relevant to an investigation concerning the prudential affairs of an ADI is
legitimately in the possession of others including, but not limited to, current
or former officers, agents, contractors or employees of the ADI.
In cases where the person with the possession, custody or
control of the relevant information forms the view that the provision of that
information to APRA may potentially incriminate them or make them liable to a
penalty, that person would, in the absence of any limitation on the right not
to incriminate oneself, be entitled to refuse to disclose that information
without any recourse in law.
The difficulty for APRA in this scenario is that the absence
of that relevant information may stymie the progress of APRA's investigation
into prudential matters of the ADI.
2.227
The further information provided in the Treasurer's response supports
the conclusion that the measures address a substantial concern and are
therefore likely to be considered legitimate objectives for the purposes of
international human rights law. The coercive
examination and information gathering powers may be of assistance to APRA in
performing its regulatory functions and, in turn, pursuing the objectives of
protecting depositors and ensuring the stability of Australia's financial
system. Accordingly, the measures are likely to be rationally connected to the
stated objectives.
2.228
In relation to whether the limitation is proportionate to the stated
objectives, the Treasurer's response identifies internal oversight mechanisms
within APRA as safeguards, including that the decision to appoint an
investigator is subject to the approval of senior APRA officers. The response
also notes that the circumstances in which an investigation may commence are
limited to matters concerning ADIs and related entities[125] under subsections 13(4), 13A(1) or 61(1) of the Banking Act 1959, which
broadly relate to the inability or failure of ADIs to meet their obligations.
This explanation from the Treasurer is relevant to the proportionality analysis
as it explains the particular regulatory context in which such investigations
occur and in which the examination and information gathering powers are used.
2.229
The Treasurer's response further states that, as set out in the bill, an
appointed investigator needs to have 'reasonable belief' that a person has
custody or control of books, accounts or documents relevant to the
investigation in order to exercise his or her powers under section 61A of the
bill. Similarly, the examination powers under proposed section 61C of the bill
are available if an investigator 'reasonably believes or suspects' that a
person can offer information relevant to the investigation. That the powers are
exercised on evidentiary or otherwise only 'reasonable' grounds is also
relevant in determining the adequacy of safeguards.
2.230
The Treasurer's response also identifies the provision of a 'use'
immunity as a relevant safeguard. In regard to whether a derivative use
immunity would be reasonably available, the Treasurer's response states:
As the committee has noted, direct use immunity is conferred
by these provisions, but not derivative use immunity. The reason for this is
that if derivative use immunity applied, it would impair APRA's ability to
effectively perform its regulatory functions.
...
In most cases, establishing compliance with derivative use
immunity would be substantially more difficult. It would require persuading the
court to the required standard that no part of the original information was
taken into account, directly or indirectly, when obtaining the information upon
which the prosecution is based.
If derivative use immunity applied, then further evidence
obtained through a chain of inquiry resulting from the protected evidence
cannot be used in relevant proceedings even if the additional evidence would
have been uncovered through independent investigative processes. Also, where
the information-obtaining power is exercised against officers or ex-officers
who may have been responsible for the deterioration or failure of a financial
institution, for example, a director implicated in a failure such as HIH, a
derivative use immunity would not be helpful in building a case against the
director for breach of their duties under law.
APRA concurs with ASIC's view expressed in ASIC's submissions
to the Australian Law Reform Commission Inquiry into Traditional Rights and
Freedoms: Issues Paper 46 (March 2015) at page 25: 'Any grant of derivative use
immunity has the potential to render a person conviction-proof for an
unforeseeable range of offences.'
These provisions are consistent with the majority of existing
self-incrimination provisions in other APRA-administered legislation, including
provisions in the SIS Act and PHI Act.
2.231
The Treasurer's response effectively argues that a derivative use
immunity would not be reasonably available, contending that it would be
difficult to establish compliance with derivative use immunity in subsequent
legal proceedings; that persons responsible for financial crimes may escape
conviction if a derivative use immunity were granted; and that the
self-incrimination provisions in the bill are consistent with other
APRA-administered legislation.
2.232
However, as noted in the initial analysis, the regulatory context in
which the abrogation against self-incrimination operates is relevant in
determining the proportionality of the measure. The Treasurer has explained the
particular regulatory context in which APRA operates, and the limited operation
of the information sharing provisions to when investigations have been
commenced concerning ADIs and related entities when such ADIs are failing or
are unable to meet their obligations. The requirement that the power only be
exercised on 'reasonable' grounds also provides an additional safeguard.
Therefore, while administrative difficulties such as proving that evidence in
an investigation was obtained independently of protected evidence are unlikely,
in isolation, to be a sufficient reason for not providing a derivative use
immunity, the specific regulatory context of the proposed powers and the
circumstances in which an investigation may commence, on balance, tend to
suggest that the limitation on the right not to incriminate oneself may be
proportionate.
Committee response
2.233
The committee thanks the Treasurer for his response and has
concluded its examination of this issue.
2.234
Based on the further information provided, the committee
considers that, on balance, the measure may be compatible with the right not to
incriminate oneself.
Compatibility of the measure with the right to privacy
2.235
The right to privacy includes respect for informational privacy,
including the right to respect for private and confidential information,
particularly the use and sharing of such information and the right to control
the dissemination of information about one's private life.
2.236
By requiring a person to attend an examination, answer questions or
provide books, accounts, documents or sign a record in connection with an APRA
investigation, including in circumstances where the provision of such
information may tend to incriminate the person, Schedule 2 of the bill engages
and limits the right to privacy.
2.237
The statement of compatibility does not acknowledge that the proposed
examination and information gathering powers engage the right to privacy and
therefore does not provide an assessment of the human rights compatibility in
relation to this aspect of the measure.[126]
2.238
Assuming that the measure pursues the objectives outlined above in
relation to the right not to incriminate oneself (that is, protecting
depositors and ensuring the stability of Australia's financial system), for the
reasons earlier stated, these may be capable of being legitimate objectives.
However, questions remain as to whether the objectives address a pressing and
substantial concern specifically in relation to this measure, and whether the
measure is rationally connected to and a proportionate means of achieving the
objectives in the context of limitations on the right to privacy.
2.239
In particular, to be proportionate, a limitation on the right to privacy
should only be as extensive as is strictly necessary to achieve its legitimate
objective and must be accompanied by appropriate safeguards. Information and
evidence as to whether the measure is the least rights-restrictive way of
achieving the stated objective of the measure, and of any safeguards in place
to protect a person's informational privacy when providing information pursuant
to APRA's examination and information gathering powers, would be of assistance
in determining the proportionality of the measure.
2.240
The committee therefore sought the advice of the Treasurer as to:
- whether the proposed coercive examination and information
gathering powers pursue a legitimate objective (including reasoning or evidence
that establishes that the stated objectives address a pressing or substantial
concern);
- how the measure is effective to achieve (that is, rationally
connected to) those objectives; and
- whether the limitation is reasonable and proportionate to achieve
the stated objectives (including whether there are less rights restrictive ways
of achieving that objective, whether the persons who may be subject to
examination and the scope of information that may be subject to compulsory
disclosure is sufficiently circumscribed with respect to the stated objective
of the measure; and whether there are adequate and effective safeguards in
relation to the measure).
Treasurer's response
2.241
In relation to whether the coercive examination and information
gathering powers pursue a legitimate objective and are rationally connected to
that objective, the Treasurer's response refers to the advice provided in
relation to the compatibility of the measure with the right not to incriminate
oneself (discussed at [2.226]-[2.227] above). As noted earlier, in light of the
Treasurer's response, it appears the measure pursues a legitimate objective and
is rationally connected to that objective.
2.242
As to the proportionality of the measure, the Treasurer's response cites
as a relevant safeguard subsection 56(2) of the Australian Prudential Regulation
Authority Act 1998 (APRA Act), which makes it an offence for a current or
former APRA officer to disclose 'protected information' or a 'protected
document'. However, it is noted that this provision is subject to a range of
exceptions which allow for the disclosure of information in certain
circumstances. For example, subsection 56(5)(a) of the APRA Act stipulates that
it is not an offence for a person to disclose information to another financial
sector supervisory agency or other agency specified in regulations when the
person is satisfied that the information will assist that agency to perform its
functions or exercise its powers.
2.243
In further reference to the proportionality of the proposed measure, the
Treasurer highlights his advice in relation to the right not to incriminate
oneself. As set out above, this includes that the scope of investigations are
limited to the inability or failure of ADIs to meet their obligations and that
investigators must have a 'reasonable' basis for exercising their powers.
Noting the information provided on potential safeguards, including subsection
56(2) of the APRA Act, as well as the specific regulatory context of the
proposed powers, on balance, the limitation on the right to privacy may be
proportionate.
Committee response
2.244
The committee thanks the Treasurer for his response and has
concluded its examination of this issue.
2.245
Based on the further information provided, the committee
considers that, on balance, the measure may be compatible with the right to
privacy.
Mr Ian Goodenough MP
Chair
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