Statement on Disallowable Instruments and Parliamentary Propriety

The Annual Reports of the Standing Committee on Regulations and Ordinances give instances of breaches of parliamentary propriety in relation to delegated legislation. Some of these breaches include cases where administrators, for a variety of reasons, have failed to observe the valid provisions of legislative instruments in force or have substituted other requirements for those prescribed by legislative instrument.

The Committee would now like to report on a related aspect of parliamentary propriety. In two recent cases the Committee scrutinised instruments where administrators had not actively substituted their own rules, but had repealed instruments or let them lapse and then dealt with the matter by means over which the Parliament has no control and about which it may not even be aware. Parliament provides for delegated legislation in the expectation that the power to make legislative instruments will be exercised whenever it is possible to do so. It is not satisfactory for administrators to avoid using provisions under which their decisions will be subject to full parliamentary scrutiny including possible disallowance and instead to use administrative means to avoid such scrutiny. Where there is a choice between making and applying a legislative instrument or addressing the matter by administrative means parliamentary propriety dictates that the former method should be used. This does not mean that wherever an Act provides for a legislative instrument that the power should be exercised immediately. It does mean, however, that where Parliament provides for legislative instruments that there is an expectation where a set of circumstances arises which is within those contemplated by the enabling Act then a legislative instrument should be made and administered. The details of the two cases where this did not occur illustrate the point.

The Safety, Rehabilitation and Compensation Act 1988 provides generally for workers' compensation and rehabilitation of Commonwealth employees. As part of its general scheme the Act provides for Comcare, which is the administering agency, to recover overpayments made to a client. The Act also provides for Comcare to waive the debt, but such waiver must be in accordance with directions given by the Minister. Such directions are, very properly, disallowable instruments.

The particular provision relating to the Minister's directions came into effect on 24 December 1992 and the Minister exercised the power on 28 April 1993. This Direction remained in force for more than four years until it was revoked by the Minister in the Directions relating to the waiver of debts due to Comcare, No.4 of 1997, which came into effect on gazettal on 8 August 1997. The Committee scrutinised this instrument and was surprised by advice in the Explanatory Statement that the revoked Determination would not be replaced. Instead, the Explanatory Statement advised, the discretion to waive debts would continue to be administered by Comcare in accordance with existing policy and procedures, including all the usual financial management requirements and accountability processes. The Explanatory Statement also advised that the decision to revoke the Direction was made taking into account advice from the Attorney-General's Department that its validity was questionable and if challenged may be found by a court to be not authorised by the enabling Act. The Explanatory Statement explained that the reason for this was a decision in a Federal Court case four years earlier about a similar enabling provision in a different Act.

The Committee was concerned at this advice and wrote to the Minister. The Committee advised that it accepted that if the previous Direction was invalid then changes should be made. The Committee would, however, welcome an assurance that a fresh valid Direction would be made as soon as possible. The Act provides for an instrument to be made and it may be a breach of parliamentary propriety if this provision of the Act was disregarded. The concern of the Committee was that the Act provided for Directions to be subject to tabling in both Houses and to possible disallowance. The present position, on the other hand, was that this matter was in future to be effectively removed from parliamentary scrutiny and dealt with by internal departmental procedures, without the oversight or even the knowledge of parliament. The Directions in question were not trivial, dealing with the rights of welfare recipients and with the protection of the public revenue.

The Minister replied to the Committee, confirming that there was no Direction at present in force. The Minister further advised that the enabling Act did not positively require that a Direction be made or that a revoked Direction be replaced. The Attorney-General's Department had advised that, because the Act gave the Minister a discretion to give a Direction, there was no parliamentary intention or expectation that the Minister should decide to exercise this power. The Minister explained that his legal advice was that the defects in the earlier Directions could not be remedied in any replacement instrument. The decision to revoke reflected the decision for the time being not to exercise the statutory power. If further experience suggested that it was appropriate then the Minister would give a Direction within the current statutory power or ask Parliament to broaden the power.

The Committee wrote back to the Minister, advising that it accepted his advice about the nature of the earlier instrument and that in future he might decide to give a new Direction or to seek amendment of the enabling Act. The Committee advised the Minister, however, that it did not accept the advice that a parliamentary enactment providing for a disallowable instrument shows no intention or expectation that the Minister should decide to exercise the power. The Committee's position was that if an Act provides for a matter to be addressed by an instrument which is subject to tabling and disallowance, then as far as practicable this is what should be done.

The second case which illustrates this general point is the Federal Court Rules (Amendment), Statutory Rules 1997 No.143, virtually the sole purpose of which was to provide for rules dealing with Native Title Proceedings under the Native Title Act 1973. The Native Title Rules were first included in the Rules with effect from 21 March 1994 with a sunset clause which provided that they cease to be in force on 1 March 1995. One day before that expiry fresh Rules extended their effect for another 12 months and again one day before this expiry new Rules extended their operation for a further 12 months. This sunset clause, however, expired on 1 March 1997 and was not replaced until 23 June 1997. The Committee wrote to the Chief Justice of the Federal Court advising that there appeared to be a gap of almost four months during which there were no Rules addressing native title issues.

The Acting Chief Justice replied, advising that the judges were aware that there would be a period during which there would be no Native Title Rules in place. The judges had decided that this would cause no difficulty for proceedings in the Court because native title proceedings were heavily case managed, that is to say, their progress is the subject of the close attention and directions of a judge. The judges had decided at a meeting in September 1996 that repeated extensions of the Native Title Rules by sunset clause was undesirable and that it would be preferable to have a permanent form of rules, even if this meant a hiatus. The opinion of the judges were that this would cause no injustice or inconvenience.

The Committee wrote again to the Acting Chief Justice noting that the Act of Parliament which creates the Federal Court provides for Rules of Court and for parliamentary scrutiny of those Rules. The Committee advised that it was concerned about the gap of four months during which there were no Rules for this important and sensitive matter. The Committee noted that new Rules, which differed only in minor ways from the previous Rules, were not made until some nine months after the meeting of the judges which discussed this matter. The Committee advised that the hiatus may raise issues of parliamentary propriety. The Native Title Rules are legislative in nature and drafted generally in a mandatory fashion, with the word "must" used dozens of times, sometimes in conjunction with "as soon as practicable" or "immediately". Further, the Rules provide for quite detailed procedural matters. The Committee asked for further advice on the practical effect of changing from detailed mandatory Rules to case management and then back to detailed Rules.

The Chief Justice replied, advising that while he appreciated the Committee's concern he had made personal enquiries and could give an assurance that the gap between the Rules did not cause any problems or affect cases. The Committee accepted this advice about the practical effect of the gap.

These two cases, however, are instances of where there may have been a breach of parliamentary propriety. In the Comcare case the justification for revoking and not remaking the Directions was technical legal problems arising from a court case four years earlier. The apparently defective Direction was in fact made shortly before the court decision and had been administered in that state for those four years. The solution here should have been to make a fresh instrument as far as this was legally possible or to amend the enabling provision to put the matter beyond doubt. In the Native Title Rules case the Committee would have preferred that the matter was dealt with continuously under the disallowable Rules of Court, rather than for three years under the Rules, then four months with no legislative instrument in force, than again under the Rules.

The Committee will continue to scrutinise legislative instruments to ensure not only that provisions in force are administered and are not disregarded, but also that legislative instruments are actually made where this is appropriate. The Committee is grateful for the assistance which it has received in its present scrutiny from the Minister for Workplace Relations and Small Business, the Hon Peter Reith MP, and from the Chief Justice of the Federal Court, the Hon Michael Black, and the Acting Chief Justice, the Hon Raymond Northrop.