Telecommunications (Regional Broadband Scheme) Charge Bill 2017 [2017] AUSStaCSBSD 248 (9 August 2017)

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Purpose	This bill seeks to establish an ongoing funding arrangement for fixed wireless and satellite infrastructure by imposing a monthly charge on carriers, including NBN Co Ltd, in relation to each premises connected to their network that has an active fixed-line superfast broadband service during the month
Portfolio	Communications and the Arts
Introduced	House of Representatives on 22 June 2017
Scrutiny principles	Standing Order 24(1)(a)(iv) and (v)

Significant matters in delegated legislation^[59]

1.80 This bill seeks to establish an ongoing funding arrangement for fixed wireless and satellite broadband infrastructure through the imposition of a charge. The funding arrangement is to be known as the Regional Broadband Scheme and the explanatory memorandum notes that the bill is a taxation measure.^[60] The bill operates in conjunction with Schedule 4 to the Telecommunications Legislation Amendment (Competition and Consumer) Bill 2017 which, among other things, seeks to establish the types of broadband services subject to and exempt from the charge, penalties for avoiding the charge, and information gathering and disclosure powers and information reporting obligations.^[61]

1.81 The bill sets out default rates of charge which will require all telecommunications carriers to pay a charge of approximately $7.10 per month, per chargeable premises. Chargeable premises are premises where a carriage service provider (i.e. a provider of retail broadband services) provides a designated broadband service. Under the bill, the initial $7.10 monthly charge will be comprised of a $7.09 base component^[62] and a $0.01266 administrative cost component.^[63] The base component is indexed annually to the consumer price index (CPI).^[64] The default administrative cost component is specified in the bill for each of the first five years,^[65] and then is indexed annually to CPI thereafter.^[66]

1.82 Although specific default rates of charge are set out on the face of the bill, the Minister may, by legislative instrument, change the amount of both the base component and the administrative cost component;^[67] however, the sum of the base and administrative cost components for any month cannot exceed $10, indexed annually to CPI.^[68] In addition, in deciding whether to make such a determination the Minister must have regard to advice provided by the ACCC.^[69]

1.83 One of the most fundamental functions of the Parliament is to levy taxation.^[70] The committee's consistent scrutiny view is that it is for the Parliament, rather than makers of delegated legislation, to set a rate of tax. In this case, the fact that default rates of the charge and a maximum cap is set in the primary legislation partly addresses the committee's scrutiny concerns. However, any delegation to the executive of legislative power in relation to taxation still represents a significant delegation of the Parliament's legislative powers.

1.84 While the committee welcomes the important limitations in the bill on the proposed ministerial power to alter the rate of taxation, from a scrutiny perspective, the committee considers that it may be appropriate for the bill to be amended to further increase parliamentary oversight by requiring the positive approval of each House of the Parliament before a new determination under subclause 12(4) or 16(8) comes into effect.^[71]

1.85 The committee requests the Minister's response in relation to this matter.

Modified disallowance procedures^[72]

1.86 In relation to the ministerial determinations altering the base component and administrative cost component made under subclauses 12(4) and 16(8), the bill (as currently drafted) proposes to modify the usual commencement and disallowance procedures for these determinations in two ways.^[73]

1.87 First, subclause 19(3) improves parliamentary oversight of these determinations by ensuring that they do not come into effect until 15 sitting days after the disallowance period has expired. The committee welcomes this modified commencement procedure.

1.88 However, subclause 19(2) seeks to reverse the usual disallowance procedure in subsection 42(2) of the Legislation Act 2003 to require a House of the Parliament to positively pass a resolution disallowing a determination within the 15 sitting day disallowance period in order for the disallowance to be effective.^[74] Normally, subsection 42(2) of the Legislation Act 2003 provides that where a motion to disallow an instrument is unresolved at the end of the disallowance period, the instrument (or relevant provision(s) of the instrument) are taken to have been disallowed and therefore cease to have effect at that time. Odgers' Australian Senate Practice notes that the purpose of this provision is to ensure that 'once notice of a disallowance motion has been given, it must be dealt with in some way, and the instrument under challenge cannot be allowed to continue in force simply because a motion has not been resolved.' Odgers' further notes that this provision 'greatly strengthens the Senate in its oversight of delegated legislation'.^[75]

1.89 Under the modified disallowance procedure proposed in subclause 19(2), if a disallowance motion is lodged, but not brought on for debate before the end of the 15 sitting day disallowance period, the relevant instrument will take effect. In practice, as the executive has considerable control over the conduct of business in the Senate, there may be occasions where no time is made available to consider the disallowance motion within 15 sitting days after the motion is lodged and therefore the instrument would be able to take effect regardless of the attempt to disallow it. As a result, the proposed procedure would undermine the Senate's oversight of delegated legislation in cases where time is not made available to consider the motion within the 15 sitting days. The explanatory memorandum provides no justification for this proposed reversal of the usual disallowance procedures in subsection 42(2) of the Legislation Act 2003.

1.90 Noting the significant practical impact on parliamentary scrutiny of this measure, the committee requests the Minister's detailed justification as to why it is proposed to reverse the usual disallowance procedures in subsection 42(2) of the Legislation Act 2003 so that where a motion to disallow an instrument is not resolved by the end of the disallowance period, the instrument will be taken not to have been disallowed and would therefore be able to come into effect.

1.91 The committee notes that the suggested amendment outlined at paragraph [1.84] above would address the committee's concerns in this regard.

[59] Clauses 8, 11 and 14. The committee draws Senators’ attention to these provisions pursuant to principles 1(a)(iv) and (v) of the committee’s terms of reference.

[70] This principle has been a foundational element of our system of governance for centuries: see, for example, article 4 of the Bill of Rights 1688: 'That levying money for or to the use of the Crown by pretence of prerogative without grant of Parliament for longer time or in other manner than the same is or shall be granted is illegal'.

[72] Clauses 8 and 13. The committee draws Senators’ attention to these provisions pursuant to principles 1(a)(iv) and (v) of the committee’s terms of reference.

[73] See clause 19. The usual commencement and disallowance procedures are contained in sections 12 and 42 of the Legislation Act 2003, respectively.

[75] Rosemary Laing (ed), Odgers' Australian Senate Practice: As Revised by Harry Evans (Department of the Senate, 14^th ed, 2016), p. 445.

Australian Senate Standing Committee for the Scrutiny of Bills - Scrutiny Digests