Coronavirus Economic Response Package Omnibus Bill 2020 - Commentary on Ministerial Responses [2020] AUSStaCSBSD 101 (10 June 2020)

• Coronavirus Economic Response Package Omnibus Bill 2020
• Henry VIII clauses—modification of primary legislation by delegated legislation1
• Deferral of sunsetting4

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Chapter 2

Commentary on ministerial responses

2.1 This chapter considers the responses of ministers to matters previously raised by the committee.

Coronavirus Economic Response Package Omnibus Bill 2020

Purpose	This bill is part of a legislation package which seeks to amend various Acts to provide an economic response, and deal with other matters, relating to the coronavirus
Portfolio	Treasury
Introduced	House of Representatives on 23 March 2020
Bill status	Received the Royal Assent on 24 March 2020

Henry VIII clauses—modification of primary legislation by delegated legislation^[1]

2.2 In Scrutiny Digest 5 of 2020 the committee requested the Treasurer’s advice as to why it is necessary and appropriate to include broad powers in the bill which allow delegated legislation to amend the operation of the Corporations Act 2001, and the circumstances in which it is envisaged that these powers are likely to be used.^[2]

Treasurer’s response^[3]

2.3 The Treasurer advised:

As the Bill has now been enacted, I provide this advice in relation to the Coronavirus Economic Response Package Omnibus Act 2020. The powers given to the Treasurer under section 1362A of the Corporations Act 2001 are a necessary and appropriate response to the impact on Australian businesses of the Coronavirus pandemic and the health measures put in place to limit its spread.
The nature of the impact of the Coronavirus health crisis is unprecedented. While it is difficult to predict precisely what regulatory issues will arise, Australian businesses and the economy will require extraordinary levels of support. To that end, section 1362A has been enacted on a contingency basis to relieve, if necessary, any unreasonable pressure being placed by the existing law on business as a direct consequence of the Coronavirus.
Section 1362A establishes a temporary and time-limited mechanism to provide short-term regulatory relief to classes of persons that, due to the Coronavirus, are unable to meet their obligations under the Corporations Act or the Corporations Regulations 2001 (the Corporations Regulations). The impact of the Coronavirus and the health measures in place to limit its spread, particularly social distancing, have impeded businesses’ ability to comply with certain provisions of the Corporations Act and Corporations Regulations.
Section 1362A also provides for short-term regulatory changes to facilitate continuation of business or mitigate the economic impact of the Coronavirus. The powers included in section 1362A are appropriate to achieve these objectives. The powers granted are limited, in terms of scope, by subsection 1362A(2), and in terms of time, by subsections 1362A(4) and 1362A(5). The provision does not provide a blanket power to amend the Corporations Act or Corporations Regulations. It is a temporary provision intended to provide targeted, short-term relief for companies from specified obligations in the Corporations Act and Corporations Regulations during the Coronavirus health crisis.
Under subsection 1362A(2), in order to make a legislative instrument under subsection 1362A(1), the Minister must be satisfied that certain circumstances exist, specifically that:
• it would not be reasonable to expect a specified class of persons to comply with the provisions because of the impact of the Coronavirus; or
• the exemption or modification is otherwise necessary or appropriate to: facilitate business continuity in circumstances relating to the Coronavirus; or, mitigate the economic impact of the Coronavirus.
The power to grant regulatory relief is thereby limited in scope to the Coronavirus pandemic or its impact on business or the economy. Under subsection 1362A(5), the time in which instruments can be made under subsection 1362A(1) is limited to 6 months, so that instruments cannot be made after 24 September 2020. Further, a legislative instrument made under section 1362A ceases to be in force six months after it is made, or earlier if specified. It is anticipated that Australian individuals, businesses and the economy will need extraordinary levels of support during this period, and so it is appropriate the Treasurer be given this power during this time.
Finally, any legislative instruments made by the Minister under section 1362A would be disallowable under section 42 of the Legislation Act 2003 and subject to review by the Senate Standing Committee for the Scrutiny of Delegated Legislation.

Committee comment

2.4 The committee thanks the Treasurer for this response. The committee notes the Treasurer’s advice that section 1362A establishes a temporary and time-limited mechanism to provide short-term regulatory relief to classes of persons that, due to the coronavirus, are unable to meet their obligations under the Corporations Act 2001 or the Corporations Regulations 2001.

2.5 The committee also notes the Treasurer’s advice that the time in which instruments can be made under subsection 1362A(1) is limited to 6 months, so that instruments cannot be made after 24 September 2020, and that a legislative instrument made under section 1362A ceases to be in force six months after it is made, or earlier if specified. The committee further notes the Treasurer’s advice that any legislative instruments made under section 1362A would be disallowable and subject to review by the Senate Standing Committee for the Scrutiny of Delegated Legislation.

2.6 While the committee welcomes this additional information, the committee takes this opportunity to reiterate that there are significant scrutiny concerns with enabling delegated legislation to override the operation of legislation which has been passed by Parliament as such clauses impact on the level of parliamentary scrutiny and may subvert the appropriate relationship between the Parliament and the Executive.

2.7 The committee considers that if the Parliament is sitting changes to, or exemptions from, primary legislation should be made by introducing a bill for consideration by the Parliament, rather than relying on the use of a Henry VIII clause.

2.8 The committee draws this matter to the attention of the Senate Standing Committee for the Scrutiny of Delegated Legislation and the Senate Select Committee on COVID-19.

Deferral of sunsetting^[4]

2.9 In Scrutiny Digest 5 of 2020 the committee requested the Attorney-General’s advice as to what criteria ministers will consider before determining whether it is appropriate to defer sunsetting under the provisions of the bill, including whether any guidance is being developed in this regard. The committee also requested that the Attorney-General provide the committee with a list of Acts and provisions of Acts that are due to sunset on or before 15 October 2020.^[5]

Attorney-General response

2.10 The Attorney-General advised:

Sunset provisions are intended to compel Ministers and the Parliament to consider whether, past a particular time, a law is still required. Schedule 16 of the Economic Response Act allows Ministers responsible for Acts or legislative instruments which are due to sunset on or before 15 October 2020 to extend the operation of these laws by up to six months through a ministerial determination (a deferral determination). This will ensure that there are no gaps in our laws while Parliament's attention is focused on other high priority and urgent measures.
The deferral determination mechanism is subject to a range of important safeguards. First, the mechanism only applies to Acts and legislative instruments that are due to sunset on or before 15 October 2020. Second, the sunset date can only be extended for up to six months and cannot be extended a second time. Third, I have advised Ministers that the Explanatory Statement accompanying a determination should clearly outline the steps that will be taken to address the sunsetting of an Act or legislative instrument ahead of the revised sunset date. Finally, as deferral determinations are disallowable legislative instruments, they will be subject to Parliamentary scrutiny.
Sunsetting Acts, or provisions of Acts
As the Committee has identified, there are no criteria within the Economic Response Act or its Explanatory Memorandum that Ministers must apply in making a deferral determination. However, I have advised Ministers that they should consider, and address in explanatory statements:
(i) whether the sunsetting Act or provision should continue beyond the current sunset date;
(ii) whether, as a result of the coronavirus pandemic, there are material difficulties in passing legislation to extend the sunset date before the Act or provision is due to sunset;
(iii) whether there is an identifiable risk to the public of allowing the Act or provision to sunset, such as detriment to the welfare of the community, creating adverse consequences for industry and the economy, constraining the ability of Government to effectively carry out its functions, or prejudicing Australia's national security interests, and
(iv) any other exceptional circumstances that justify the making of a deferral determination.
Legislative instruments or provisions of legislative instruments that are sunsetting
Section 50 of the Legislation Act 2003 provides for the automatic repeal of legislative instruments. The next sunset date under section 50 of the Legislation Act is 1 October 2020. For these instruments, Ministers should use the existing mechanisms for deferral and alignment of sunset dates in sections 51 and 51A of the Legislation Act. A deferral determination can only be made if these deferral and alignment mechanisms have been exhausted, or are not appropriate.
For legislative instruments that cannot be extended through the deferral and alignment provisions in the Legislation Act, or for legislative instruments or provisions of instruments that are self-ceasing, a deferral determination may be appropriate where:
(i) there is insufficient time to assess the ongoing need for an instrument or provisions of an instrument, due to competing priorities or circumstances arising from the coronavirus pandemic, or
(ii) the instrument is still required, and there is insufficient time to develop a replacement or amending instrument due to competing priorities or circumstances arising from the coronavirus pandemic.
I have provided the advice contained in this letter to all portfolio Ministers to guide their consideration when assessing the need for a deferral determination.
The Committee also requested a list of all Acts and provisions of Acts that are due to sunset on or before 15 October 2020. My department has sought input from all Commonwealth agencies to compile this information. Outlined below are provisions of Acts which I am aware are due to sunset during this period, and their relevant sunset date:
• Division 3 of Part III of the Australian Security Intelligence Organisation Act 1979 – 7 September 2020
• paragraph 124PF(1)(b) and paragraphs 123UF(1)(g) and 2(h) of the Social Security (Administration) Act 1999 – 30 June 2020 and 1 July 2020, and
• subsection 504(2) of the Social Security Act 1991 – 25 September 2020.
Since the passage of the Economic Response Act, the Parliament has also enacted time limited amendments to the Fair Work Act 1999 to complement the $130 billion JobKeeper payment scheme. These amendments sunset on 28 September 2020 to align with the operation of that scheme.

Committee comment

2.11 The committee thanks the Attorney-General for this response. The committee notes the Attorney-General’s advice that the provisions which allow ministers responsible for Acts or legislative instruments which are due to sunset on or before 15 October 2020 to extend the operation of these laws by up to six months are intended to ensure that there are no gaps in our laws while Parliament's attention is focused on other high priority and urgent measures.

2.12 In relation to sunsetting Acts, or provisions of Acts, the committee welcomes the Attorney-General's advice that he has advised ministers that they should consider, and address in explanatory statements:

• whether the sunsetting Act or provision should continue beyond the current sunset date;

• whether, as a result of the coronavirus pandemic, there are material difficulties in passing legislation to extend the sunset date before the Act or provision is due to sunset;

• whether there is an identifiable risk to the public of allowing the Act or provision to sunset; and

• any other exceptional circumstances that justify the making of a deferral determination.

2.13 In relation to sunsetting legislative instruments, or provisions of legislative instruments, the committee notes the Attorney-General's advice that ministers should use the existing mechanisms for deferral and alignment of sunset dates in sections 51 and 51A of the Legislation Act 2003, and that a deferral determination can only be made if these deferral and alignment mechanisms have been exhausted, or are not appropriate. The committee welcomes the Attorney-General's statement that he has provided the advice contained in his letter to the committee to portfolio ministers to guide their consideration when assessing the need for a deferral determination for legislative instruments.

2.14 While the committee welcomes the guidance that the Attorney-General has set out in his response to the committee in relation to the criteria that ministers should consider before determining whether it is appropriate to defer sunsetting, the committee considers that it would have been preferable to include such guidance on the face of the primary legislation.

2.15 The committee also takes this opportunity to draw Senators' attention to the following provisions of Acts that are not related to the COVID-19 pandemic and are due to sunset on or before 15 October 2020:

• paragraph 124PF(1)(b) and paragraphs 123UF(1)(g) and 2(h) of the Social Security (Administration) Act 1999 (relating to the Cape York Welfare Reform Income Management measure and the Cashless Debit Card trials)—due to sunset on 30 June 2020; and

• Division 3 of Part III of the Australian Security Intelligence Organisation Act 1979 (relating to special powers relating to terrorism offences)—due to sunset on 7 September 2020.

2.16 The committee notes that this bill passed the Parliament on 23 March 2020. Since that time both Houses have revised the parliamentary sitting calendar, which provides for a greater number of sitting days than was envisaged at the time the bill was passed. In light of this, the committee considers that it is not clear that the Parliament would lack the time to debate and, if appropriate, pass primary legislation to extend the operation of provisions due to sunset such as those outlined above. If it is considered that a sunset date should nevertheless be extended by delegated legislation the committee considers the date should only be extended to the extent necessary to provide time for the Parliament to consider relevant primary legislation (rather than the full six months permitted under Schedule 16 to the bill).

2.17 The committee draws this matter to the attention of the Senate Standing Committee for the Scrutiny of Delegated Legislation and the Senate Select Committee on COVID-19.

2.1

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[1] Schedule 8, item 1. The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(iv).

[2] Senate Scrutiny of Bills Committee, Scrutiny Digest 5 of 2020, pp. 13-14.

[3] The Treasurer responded to the committee's comments in a letter dated 21 May 2020. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 6 of 2020 available at: www.aph.gov.au/senate_scrutiny_digest

[4] Schedule 16. The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(v).

[5] Senate Scrutiny of Bills Committee, Scrutiny Digest 5 of 2020, pp. 15-16.