Environment Protection and Biodiversity Conservation Amendment (Cost
Recovery) Bill 2014
Only a small number of submissions commented on the Environment
Protection and Biodiversity Conservation Amendment (Cost Recovery) Bill 2014
(the Cost Recovery Bill). Submitters provided comments in relation to the cost
recovery mechanism and proposals in relation to action management plans.
Cost recovery proposal
The Department of the Environment (the department) commented that the
cost recovery mechanism will provide the Government with a sustainable source
of funds to perform its regulatory role under the EPBC Act and to provide an
incentive to proponents to better assist in the environmental impact assessment
The Minister for the Environment, the Hon Greg Hunt MP, in the second reading
Environmental assessment activities are appropriate for cost
recovery because the activities deliver a clear benefit for a particular
beneficiary by enabling them to undertake an activity approved under the EPBC
He went on to explain:
Cost recovery will also improve the department's ability to
meet statutory time frames by providing a sustainable source of resources to improve
the efficiency of the assessment process. It will also provide incentives to
industry to undertake early engagement and incorporate the most environmentally
acceptable outcomes into their business planning, as this may reduce the level
of assessment required and therefore any costs payable.
Places You Love Alliance supported the proposed cost recovery mechanisms.
They claimed it will ensure that the department is adequately resourced to
ensure operation of the Act and monitor performance.
Friends of Grassland added that cost recovery may also encourage
environmentally sound development, in that a proponent would be unlikely to pay
an upfront fee unless the proposed action is likely to be approved.
Issues raised in relation to cost
Many industry groups were opposed to the cost recovery proposals. For
example, the Business Council of Australia put the view that cost recovery
should only be undertaken where there is a clearly identifiable beneficiary,
that is, the benefits of the activity are largely private. The council
concluded that 'where the benefits of the activity undertaken are public then
it is not appropriate to apply cost recovery to a private proponent'.
This view was supported by other submitters.
Ms Melanie Stutsel, Minerals Council of Australia, stated:
...we do not support cost recovery in principle to fund the
Australian government in carrying out its legislative responsibilities. We
instead consider that the implementation of the EPBC Act should be properly
resourced from the government's existing revenue base.
It was also argued that developers already contribute through compliance
costs for development assessment and through the substantial tax revenues that
derive from development.
Some opponents to the cost recovery proposal argued that the
implementation of cost recovery for matters decided under the Environment
Protection and Biodiversity Conservation Act 1999 (EPBC Act) would increase
the financial burden on proponents.
Further, as noted by the Association of Mining Exploration Companies (AMEC),
different industries would have varying capacities to pass on the costs to the
The National Farmers' Federation (NFF) argued that: there is little
transparency in how the cost base that is to be recovered will be determined;
there is no review mechanism, no benchmarking of the costs recovered to
determine whether these are efficient, prudent and relevant; and there is a
lack of independent regulatory oversight.
In addition, the NFF noted that the Government proposes to provide a small
business exemption. However, the exemption is based on turnover as opposed to
profit. The NFF argued that this is 'particularly problematic for the
agricultural sector' and recommended that the Australian Taxation Office
definition of primary producer be adopted and included as an additional
As a consequence of these concerns, industry groups have argued that, if
cost recovery is implemented:
there should be a direct correlation between the cost of
providing the service and the fees levied, with no cross-subsidisation;
the process for determining fees should be open and transparent;
the service should be provided in the most cost efficient and effective
there should be a review mechanism and/or an independent
regulator overseeing the setting of fees; and
clear timeframes should be established to increase certainty in
The department responded to these concerns noting that the introduction
of cost recovery for environmental assessments under the EPBC Act will mean that
each person proposing to take an action that will have or is likely to have a
significant impact on a matter of national environmental significance will pay for
the services required to assess their application. This results in a more
equitable sharing of the costs associated with protecting the environment
between the general public and those who will derive a private benefit from environmental
In relation to concerns about increased burdens on proponents, the
department stated that where proponents provide good quality data and upfront
information, the assessment process will be more efficient and consequentially
the proponent will be made subject to lower fees.
Dr Rachel Bacon, Department of the Environment, added:
Cost recovery will also provide incentives to industry to
undertake early engagement and incorporate the most environmentally acceptable
outcomes into their business planning in order to reduce costs...The
implementation of cost recovery under the EPBC Act will provide a sustainable
source of resources to improve the efficiency of the assessment process where
the Commonwealth continues to undertake environmental assessments.
Dr Bacon highlighted that cost recovery under the bill will only apply
to Commonwealth processes—it will not apply to activities undertaken by states
and territories under a one-stop shop system. Cost recovery of state or
territory environmental assessment activities will remain a matter for those
The department noted that it had consulted widely with a range of
affected groups on proposed cost recovery arrangements. The consultation
process included publication of a consultation paper in September 2011, which
resulted in changes to the proposed arrangements. Following the release of a
draft Cost Recovery Implementation Statement in May 2012, the department sought
comments from a wide range of stakeholders and hosted a consultation workshop.
The Hon. Mr Greg Hunt MP, Minister for the Environment, in his second
reading speech, noted that the bill allows for regulation to set fees and the
methods of calculation of a fee. He went on to state that the department would
release a cost recovery impact statement which details the fees payable and the
methods for calculating fees and concluded 'we will, of course, consult with
industry and the community in the process of so doing'. The bill also provides
a process for proponents to apply for a reconsideration of the way in which a
method may be used to calculate fees.
The ministers concluded:
The introduction of cost recovery complements the
government's commitment to streamlining environmental approvals under the
one-stop shop process by ensuring Commonwealth assessment activities are as
efficient and effective as possible.
Issues related to action management plan proposals
The Cost Recovery Bill aims to set out the formal process for
developing, submitting and varying action management plans under the EPBC Act
thus allowing for cost recovery for activities associated with approving these
plans. The proposed addition of section 134A would allow the minister to seek
public comment on a proposed action management plan, but does not make it
Lock the Gate Alliance commented in relation to these amendments. While
supporting moves to provide the opportunity for public comment on the making of
management plans for managing the impacts of projects on matters of national
environmental significant, the Alliance argued that this should be a
requirement for all management plans, not a discretionary measure for the
Minister to determine. In addition, while supporting the 'basic idea' of the
requirement for ministerial approval of changes to management plan, the
Alliance submitted that there was a need for public scrutiny of these
Finally, the Hon. Mr Greg Hunt MP, Minister for the Environment,
explained that the changes to provisions relating to action management plans
were designed to bring those plans into the cost recovery regime and give the
minister the flexibility to specify required environmental outcomes or
management strategies as more data becomes available or new technologies are
The committee is of the view that as proponents gain the benefit of an
activity approved under the EPBC Act, it is appropriate that they should
contribute to the costs of approval. The committee notes that the department
has undertaken extensive consultation in relation to these reforms and that
amendments were made to the proposal before the bill was introduced into the
In addition, the committee notes that the Hon. Mr Greg Hunt MP, Minister
for the Environment, indicated in his second reading speech that the waiver
capacity will be available in relation to public institutions such as local
In combination with the one stop shop proposal, the committee also
considers that the cost recovery proposals will result in more efficient and
sustainable environmental approvals processes.
The committee recommends that the Environment Protection and
Biodiversity Conservation Amendment (Cost Recovery) Bill 2014 be passed.
Senator John Williams
Navigation: Previous Page | Contents | Next Page