Coronavirus Economic Response Package Omnibus Bill 2020 [2020] AUSStaCSBSD 67 (17 April 2020)

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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

Henry VIII clauses—modification of primary legislation by delegated legislation^[25]

1.40 Item 1 of Schedule 8 seeks to insert new section 1362A into the Corporations Act 2001 (Corporations Act), to provide that the Treasurer may, by disallowable legislative instrument, temporarily exempt specified classes of persons from the operation of specified provisions, or temporarily modify the operation of specified provisions of, the Corporations Act or the Corporations Regulations. The Treasurer must be satisfied that it would not be reasonable to expect the relevant persons to comply with the relevant provisions because of the impact of COVID-19 or that the exemption is necessary to facilitate the continuation of business or mitigate the economic impact of COVID-19. Any instrument made under this provision may only operate for up to 6 months.

1.41 Additionally, item 40A of Schedule 11 provides that the Minister for Social Services may, by legislative instrument, modify social security law to vary provisions relating to the qualifications of persons for social security payments and the rate of social security payments.

1.42 A provision that enables delegated legislation to amend or modify primary legislation is known as a Henry VIII clause. 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. As such, the committee expects a sound justification for the use of a Henry VIII clause to be provided in the explanatory memorandum.

1.43 The explanatory memorandum provides no explanation for why it is necessary and appropriate to include either Henry VIII clause. While noting that both clauses are limited in the length of their operation, the committee has significant scrutiny concerns regarding the inclusion of broad and relatively unlimited powers for ministers to use delegated legislation to amend the operation of primary legislation.

1.44 As no justification has been provided in the explanatory materials, the committee requests 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.

1.45 The committee also requests the Minister for Families and Social Services’ 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 social security law, and the circumstances in which it is envisaged that these powers are likely to be used.

1.46 The committee also draws this matter to the attention of the Senate Select Committee on COVID-19.

Delegation of legislative power
Broad discretionary powers^[26]

1.47 Item 12 of Schedule 11 seeks to insert proposed section 504 into the Social Security Act 1991 to provide that if a person is receiving a parenting payment, the rate of the payment is increased by the amount of the COVID-19 supplement. Proposed subsection 504(3) provides that the minister may, by legislative instrument, extend the initial period of the supplement by a period of up to 3 months. Proposed subsection 504(5) provides that the minister may, by legislative instrument determine an amount for the supplement. Proposed subsection 504(7) provides that the minister may, by legislative instrument, determine the amount of the supplement for any extension period. These provisions are repeated at item 21 (in relation to youth allowance), item 30 (in relation to the jobseeker payment), item 34 (in relation to sickness allowance) and item 39 (in relation to other social security payments).

1.48 The committee considers that these provisions provide the minister with a broad discretionary power to alter or extend the operation of supplement payments by legislative instrument in circumstances where there is limited guidance on the face of the primary legislation as to when these powers should be exercised. The committee expects that the inclusion of broad discretionary powers, which could result in a reduction in the amount of supplement paid to certain persons, should be thoroughly justified in the explanatory memorandum. In this instance, no explanation is provided in the explanatory memorandum.

1.49 As no justification has been provided in the explanatory materials, the committee requests the Minister for Families and Social Services’ advice as to why it is necessary and appropriate to provide the minister with broad discretionary powers to alter or extend the operation of supplement payments in the Social Security Act 1991, including the appropriateness of allowing the minister to set the amount of supplement below the amount provided for by the Parliament in the primary legislation.

1.50 The committee also draws this matter to the attention of the Senate Select Committee on COVID-19.

Deferral of sunsetting^[27]

1.51 Schedule 16 seeks to provide the relevant minister with the power to determine a new sunset date for legislation that is due to sunset on or before 15 October 2020. Subitem 1(2) provides that the sunsetting day can be deferred for up to 6 months from the original sunset day.

1.52 In relation to sunset clauses in primary legislation, the committee considers that these clauses are important safeguards which facilitate increased parliamentary scrutiny and oversight of primary legislation containing extraordinary measures. Where a sunset clause is enacted in primary legislation, the committee considers that it should not be extended without a thorough review and the presentation of compelling evidence to the Parliament.

1.53 In relation to sunset clauses in delegated legislation, the committee considers that the current sunsetting framework provides an important opportunity for Parliament to maintain effective and regular oversight of delegated legislative powers, and, in particular, ensure that the content of legislative instruments remains current and lawful. In this way, the regime promotes parliamentary supremacy.

1.54 The committee therefore has significant scrutiny concerns about the provisions of the bill which allow sunsetting dates to be deferred for any Act or legislative instrument that would sunset on or before 15 October 2020 in circumstances where there are no requirements on the face of the bill requiring the relevant minister to consider whether it is appropriate that sunsetting be deferred. The explanatory memorandum contains no information regarding when it will be appropriate for relevant ministers to determine that an extension of the sunsetting date is appropriate.

1.55 The committee therefore requests 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).

1.56 The committee also requests 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.

1.57 The committee also draws this matter to the attention of the Senate Select Committee on COVID-19.

[25] Schedule 8, item 1 and Schedule 11, item 40A. The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(iv).

[26] Schedule 11, items 12, 13, 21, 22, 30, 34 and 39. The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(ii) and (iv).

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

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