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Australian Senate Standing Committee for the Scrutiny of Bills - Scrutiny Digests |
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Purpose
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This bill seeks to amend the Water Act 2007 to establish the role of
an independent Inspector-General of Water Compliance to monitor, and provide
independent oversight of, water
compliance
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Portfolio
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Resources, Water and Northern Australia
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Introduced
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House of Representatives on 26 May 2021
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1.165 Schedule 1 to the bill seeks to insert a number of new criminal offences and civil penalty provisions into the Water Act 2007 (the Water Act).
1.166 Proposed sections 73A and 73B provide that it is an offence to take water from an area that is subject to a water resource plan where the taking of that water is not permitted under the law of a state. Proposed subsections 73A(8) and 73B(9) state that a person may rely on an exception, exemption, excuse, qualification or justification provided by the law of a state, so long as this does not involve determining the person's state of mind. A defendant bears an evidential burden in relation to these offence-specific defences.
1.167 At common law, it is ordinarily the duty of the prosecution to prove all elements of an offence. This is an important aspect of the right to be presumed innocent until proven guilty. Provisions that reverse the burden of proof and require a defendant to disprove, or raise evidence to disprove, one or more elements of an offence, interferes with this common law right.
1.168 While in this instance the defendant bears an evidential burden (requiring the defendant to raise evidence about the matter), rather than a legal burden (requiring the defendant to positively prove the matter), the committee expects any such reversal of the evidential burden of proof to be justified in the explanatory memorandum. In this instance the explanatory memorandum states that the reversal of the evidential burden of proof is appropriate because:
... the applicability of any State-based excuse or defence will be peculiarly within the knowledge of the first person as it relates to that person’s particular circumstances with respect to their water arrangements. For criminal proceedings this is in line with Part 2.6 of the Criminal Code, which provides that a defendant who wishes to rely on any exception, exemption, excuse, qualification or justification provided by the law creating an offence bears an evidential burden in relation to that matter.[117]
1.169 The committee notes that the Guide to Framing Commonwealth Offences[118] provides that a matter should only be included in an offence-specific defence (as opposed to being specified as an element of the offence), where:
• it is peculiarly within the knowledge of the defendant; and
• it would be significantly more difficult and costly for the prosecution to disprove than for the defendant to establish the matter.[119]
1.170 From the justification provided, it is unclear to the committee that the defences in proposed subsections 73A(8) and 73B(9) are matters that would be peculiarly within the knowledge of the defendant. For example, whether the relevant conduct is permitted by a state law would appear to be a matter of public fact that the prosecution could readily ascertain.
1.171 A number of other provisions within the bill provide that a person is not liable for a civil penalty if the person has a reasonable excuse. Proposed section 154E provides that a person bears an evidential burden if they wish to rely on the defence of reasonable excuse under one of these provisions.
1.172 Proposed sections 73F and 73G provide that a person is liable to a civil penalty if they are required by the Basin Plan to give a notification with respect to the trading of water access rights and fail to do so. Proposed subsections 73F(2) and 73G(2) provide that it is a defence if the person has a reasonable excuse.
1.173 Proposed sections 222D, 238, 239AC, and 239AD provide that a person is liable for a civil penalty if they are required to give information by the Inspector-General and fail to do so. Proposed subsections 222D(6), 238(6), 239AC(6), and 239AD(7) provide that it is a defence if the person has a reasonable excuse.
1.174 The committee notes that the Guide to Framing Commonwealth Offences states that:
An offence-specific defence of ‘reasonable excuse’ should not be applied to an offence, unless it is not possible to rely on the general defences in the Criminal Code or to design more specific defences.[120]
1.175 The committee notes that these reversals of the evidential burden of proof relate to civil penalty provisions, rather than criminal offences. However, the committee recognises that, in certain cases, there may be a blurring of distinctions between criminal offences and civil penalty provisions, with civil penalties applied in circumstances that are akin to criminal offences. The committee considers that reversals of the evidential burden of proof in such cases merit careful scrutiny,[121] as there could be a risk that reversing the evidential burden of proof may unduly trespass on personal rights and liberties.
1.176 The committee therefore expects the explanatory materials for a bill which includes the defence of 'reasonable excuse' to include a justification as to why the defence is appropriate and an explanation as to why it is not possible to include more specific defences within the bill. In this instance, the statement of compatibility with human rights states:
Sections 73F, 73G, 222D, 238, 239AC and 239AD include offences for which an exception applies if the person has a reasonable excuse. The defendant would bear the evidential burden of proving any exception. This is necessary in order to achieve the legitimate objective of ensuring the Basin Plan is complied with, with respect to the trading of water access rights, and ensuring the Inspector-General is provided with information when requested from a person. These sections are reasonable and proportionate to the legitimate objective because the defendant will exclusively have the information or knowledge that is evidence of the exception, being their reasonable excuse for not having complied with their requirements under the Basin Plan, or why they cannot provide the Inspector-General with information when requested.[122]
1.177 The committee notes that this justification does not contain any information regarding why it is not possible to include more specific defences within the bill. Moreover, the committee does not consider it sufficient to merely state that information about a reasonable excuse will be exclusively within the defendant's knowledge. Rather, the committee expects that an explanation as to the appropriateness of including a defence of reasonable excuse be provided.
1.178 The committee emphasises that the mere fact that it is more difficult for the prosecution to prove a particular matter is not, of itself, a sufficient justification for placing the evidential burden of proof on a defendant. The committee considers that it does not appear to be appropriate to reverse the evidential burden of proof in relation to these matters.
1.179 The committee therefore requests the minister's detailed advice as to the appropriateness of including the specified matters as offence-specific defences rather than as elements of the offences, including:
• how the matters in proposed sections 73A and 73B are peculiarly within the knowledge of the defendant; and
• why it is appropriate to use a defence of reasonable excuse in proposed subsections 73F(2), 73G(2), 222D(6), 238(6), 239AC(6), and 239AD(7), including why it is not possible to rely upon more specific defences.
1.180 Item 9 of Schedule 1 to the bill seeks to insert proposed subsection 22(8A) into the Water Act to provide that the Basin Plan may confer functions or powers on the Inspector-General for the purpose of ensuring compliance with provisions of the Basin Plan.
1.181 The committee's view is that significant matters, such as conferring functions and powers for the purposes of compliance, should be included in primary legislation unless a sound justification for the use of delegated legislation is provided. In this instance, the explanatory memorandum contains no justification for including these matters in delegated legislation.
1.182 Moreover, although the explanatory memorandum provides an example of a matter for the purposes of which functions and powers may be conferred,[124] neither the explanatory memorandum nor the bill contain any guidance regarding what kinds of functions or powers it is contemplated will be conferred on the Inspector-General, other than that they must relate to ensuring compliance with a relevant matter.
1.183 In light of the above, the committee requests the minister's detailed advice as to:
• why it is considered necessary and appropriate to leave the conferral of functions and powers on the Inspector-General for the purpose of ensuring compliance with the Basin Plan to delegated legislation; and
• whether the bill can be amended to include at least high-level guidance regarding this matter on the face of the primary legislation.
1.184 The bill seeks to insert several provisions into the Water Act which provide for the preparation of reports, guidelines and other documents. These are:
• schedule 1, item 14, 73L;
• schedule 1, item 14, 73M;
• schedule 1, item 67, 215V;
• schedule 1, item 67, 215Y;
• schedule 1, item 67, 215Z;
• schedule 1, item 148, 239AE; and
• schedule 1, item 148, 239AF.
1.185 Of the reports prepared under the provisions listed above, only the report prepared under proposed section 215Z, on the review of the role of the Inspector‑General, is required to be tabled in the Parliament.[126] The remaining provisions relate to reports into audits,[127] annual reports,[128] reports on inquiries conducted by the Inspector-General,[129] and guidelines issued by the Inspector‑General.[130]
1.186 While the committee notes that each of these reports either may, or must, be published online, the committee’s consistent scrutiny view is that tabling documents in Parliament is important to parliamentary scrutiny, as it alerts parliamentarians to the existence of documents and provides opportunities for debate that are not available where documents are not made public or are only published online. Tabling reports on the operation of regulatory schemes promotes transparency and accountability. As such, the committee expects there to be appropriate justification for failing to mandate tabling requirements. In this instance, the explanatory memorandum does not provide an explanation as to why any of the reports or guidelines referred to in paragraph 1.184 are not required to be tabled in Parliament.
1.187 Noting the impact on parliamentary scrutiny of not providing for reports to be tabled in Parliament, the committee requests the minister's advice as to whether the bill can be amended to provide that the minister must arrange for a copy of a report prepared under each of the provisions listed at paragraph 1.184 be tabled in each House of the Parliament.
1.188 Proposed section 215V provides that the Inspector-General of Water Compliance may issue guidelines relating to the management of basin water resources by Commonwealth and basin state agencies under certain provisions of the Act, legislative instruments made under the Water Act, the Basin Plan, and water resource plans. Proposed subsection 215V(3) states that these guidelines are not legislative instruments.
1.189 The committee notes that non-legislative guidelines will not be subject to the tabling, disallowance or sunsetting requirements that typically apply to legislative instruments. As such there is no parliamentary scrutiny of non-legislative guidelines. Given the impact on parliamentary scrutiny, the committee expects the explanatory materials to the bill to include a justification for why instruments such as the guidelines issued under proposed section 215V are not legislative in character. In this case the explanatory memorandum merely notes that:
Subsection 215V(3) would clarify that guidelines issued under new subsection 215V(1) are not legislative instruments for the purposes of subsection 8(1) of the Legislation Act. This provision is declaratory of the law and is to assist the reader. Guidelines are administrative in nature.[132]
1.190 While acknowledging this explanation, it is unclear to the committee why guidelines relating to the management of basin water resources by Commonwealth and state agencies are considered to be administrative, rather than legislative, in character. The committee notes that paragraph 8(4)(b) of the Legislation Act 2003 states that, among other things, an instrument has legislative character if it determines the law, alters the content of the law, has the direct or indirect effect of affecting a privilege or interest, or of imposing an obligation, creating a right, or varying or removing an obligation or right.
1.191 In this regard, the committee notes that the matters to which the guidelines may relate are broadly construed, that Commonwealth and basin state agencies must have regard to the guidelines when performing their water management obligations,[133] that the Inspector-General must have regard to the guidelines while conducting inquiries under proposed section 239AA,[134] and that an auditor must have regard to any applicable guidelines while conducting an audit under proposed section 73L.[135] In any event, given that the management of Basin water resources is of such significance, from a scrutiny perspective the committee considers that it is important to allow for additional parliamentary scrutiny and oversight.
1.192 In light of the above, the committee requests the minister's detailed advice regarding:
• why it is considered necessary and appropriate to specify that guidelines made under proposed section 215V are not legislative instruments; and
• whether the bill could be amended to provide that the guidelines are legislative instruments to ensure they are subject to appropriate parliamentary scrutiny.
1.193 Proposed subsection 215W(1) provides that the Inspector-General may delegate any or all of their functions or powers to an APS employee within the department. This delegation power is limited by proposed subsections 215W(2), (3) and (4) which variously provide that the Inspector-General must not delegate certain functions or powers or must only delegate certain functions or powers to employees who are at a Senior Executive Service, acting Senior Executive Service, Executive Level 2, or acting Executive Level 2 level.
1.194 The committee has consistently drawn attention to legislation that allows the delegation of administrative powers to a relatively large class of persons, with little or no specificity as to their qualifications or attributes. Generally, the committee prefers to see a limit set either on the scope of powers that might be delegated, or on the categories of people to whom those powers might be delegated. The committee's preference is that delegates be confined to the holders of nominated offices or to members of the Senior Executive Service. Where broad delegations are provided for, the committee considers that an explanation of why these are considered necessary should be included in the explanatory memorandum.
1.195 While the committee notes that proposed subsections 215W(2), (3) and (4) provide some safeguards in relation to the broad delegation under subsection 215W(1), the committee remains concerned that the explanatory memorandum contains no justification for the delegation of functions or powers to employees below the Senior Executive Service level.
1.196 The committee has concerns in relation to the Inspector-General's power to delegate their powers to a person at the Executive Level 2 level under proposed subsection 215W(4). While the scope of the powers that may be delegated under proposed subsection 215W(4) are limited to powers to give certain kinds of notices or disclose certain kinds of information, the committee's preference is that delegates be confined to the holders of nominated offices or to members of the Senior Executive Service. In this instance, the explanatory memorandum states:
Delegation to this level would be necessary to ensure the efficiency and effectiveness of government operations. The powers and functions contained within paragraphs 215W(4)(a) to (c) require undertaking without any undue delay or deferral and delegation would provide the necessary flexibility to adapt to these requirements.[137]
1.197 While noting this explanation, the committee has generally not accepted a desire for administrative flexibility as a sufficient justification for allowing a broad delegation of administrative powers to officials below the Senior Executive Service level.
1.198 In light of the above, the committee requests the minister's detailed advice as to:
• which powers and functions it is proposed to allow the Inspector-General to delegate under proposed subsection 215W(1) that will not be subject to the limitations in subsections 215W(2), (3) and (4); and
• why it is considered necessary and appropriate to allow the Inspector-General to delegate their functions and powers to any APS employees under proposed subsection 215W(1) and to Executive Level 2 employees under proposed subsection 215W(4), rather than restricting the delegation of these powers to members of the Senior Executive Service or to holders of nominated offices.
1.199 Item 67 of Schedule 1 seeks to insert proposed section 222G into the Water Act to provide that the Inspector-General may appoint one or more individuals to be authorised compliance officers. The Inspector-General must not make such an appointment unless satisfied that the person is fit and proper to be an authorised compliance officer.[139] In considering whether a person is fit and proper, proposed paragraph 222G(5)(a) provides that the Inspector-General must have regard to the matters prescribed by the regulations.
1.200 The committee's view is that significant matters, such as whether a person can be considered to be fit and proper to be an authorised officer, should be included in primary legislation unless a sound justification for the use of delegated legislation is provided. In this instance, the explanatory memorandum contains no justification for including these matters in delegated legislation.
1.201 The committee's scrutiny concerns are heightened in this instance because there is little guidance on the face of the bill as to what will be relevant to considering whether a person is fit and proper to be an authorised compliance officer.
1.202 In light of the above, the committee requests the minister's detailed advice as to:
• why it is considered necessary and appropriate to leave matters relevant to whether a person is fit and proper to be an authorised compliance officer to delegated legislation; and
• whether the bill can be amended to include at least high-level guidance regarding this matter on the face of the primary legislation.
1.203 Item 148 of Schedule 1 seeks to insert proposed section 239AG into the Water Act to provide that, if the Inspector-General proposes to include material that is critical of a person or body in a report prepared under either proposed sections 239AE or 215Y, the Inspector-General must give the person or body an opportunity to comment on the report before it is finalised. Proposed subsection 239AG(3) provides that a person or body acting in good faith is not liable for contravening a law of the Commonwealth or for civil proceedings for loss, damage or injury as a result of giving the comments.
1.204 The immunities provided for under proposed subsection 239AG(3) would remove any common law right to bring an action to enforce legal rights (for example, a claim of defamation), unless it can be demonstrated that lack of good faith is shown. The committee notes that, in the context of judicial review, bad faith is said to imply a lack of an honest or genuine attempt to undertake the task and that it will involve a personal attack on the honesty of the decision maker. As such, courts have taken the position that bad faith can only be shown in very limited circumstances.
1.205 The committee expects that, if a bill seeks to confer immunity from liability, particularly where such immunity could affect individual rights, this should be soundly justified in the explanatory materials. In this instance, the explanatory memorandum does not contain any justification for conferring immunity under proposed subsection 239AG(3). The committee's concerns in this instance are heightened as immunity is provided for contravention of any law of the Commonwealth in addition to civil proceedings.
1.206 In light of the above, the committee requests the minister's detailed advice as to why it is considered necessary and appropriate to confer immunity from liability on persons and bodies giving comments under proposed section 239AG.
1.207 Item 2 of Schedule 3 seeks to insert proposed subsection 18C(2A) into the Water Act to provide that subsection 14(2) of the Legislation Act 2003 does not apply to regulations made for the purposes of existing subsection 18C(1) of the Water Act. This means that regulations made under subsection 18C(1) may make provision in relation to a matter by applying, adopting or incorporating any matter contained in an instrument or other writing as in force or existing from time to time. Subsection 18C(1) of the Water Act currently provides that the regulations may make amendments to Schedule 1 of that Act by incorporating amendments made to, and in accordance with, the Murray‑Darling Basin Agreement.
1.208 At a general level, the committee will have scrutiny concerns where provisions in a bill allow the incorporation of legislative provisions by reference to other documents because such an approach:
• raises the prospect of changes being made to the law in the absence of parliamentary scrutiny;
• can create uncertainty in the law; and
• means that those obliged to obey the law may have inadequate access to its terms (in particular, the committee will be concerned where relevant information, including standards, accounting principles or industry databases, is not publicly available or is available only if a fee is paid).
1.209 The committee will have heightened concerns where provisions in a bill propose to incorporate external documents as in force 'from time to time' because this would mean that any future changes to that document would operate to change the law without any involvement from Parliament. Consequently, the committee expects that the explanatory materials for a bill which proposes to allow the incorporation of external materials as in force from time to time should contain a sound justification as to why this incorporation power is necessary and appropriate. In this instance, the explanatory memorandum states:
This item would provide the necessary contrary intention such that the prohibition in subsection 14(2) of the Legislation Act against legislative or notifiable instruments making provision in relation to a matter by reference to any matter contained in an instrument or other writing as in force or existing from time to time does not apply. This means that regulations made for the purposes of subsection 18C(1) may make reference to a matter contained in an instrument or other writing as in force or existing from time to time, if necessary, to do so.[142]
1.210 The committee notes that this explanation is merely declarative of the law and does not contain any justification as to why it is necessary and appropriate to include a contrary intention to subsection 14(2) of the Legislation Act 2003 within the bill.
1.211 In light of the above, the committee requests the minister's advice as to why it is considered necessary and appropriate to allow for the incorporation of documents as in force or existing from time to time, noting that such an approach may mean that future changes to an incorporated document could operate to change aspects of the Murray-Darling Basin Agreement without any involvement from the Parliament.
[116] Schedule 1, item 2, proposed subsections 73A(8), 73B(9), 73F(2), and 73G(2); item 78, proposed subsection 222D(6); item 147, proposed subsection 238(6); item 148, proposed subsections 239AC(6) and 239AD(7). The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(i).
[117] Explanatory memorandum, p. 24.
[118] Attorney-General's Department, A Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, September 2011, pp. 50-52.
[119] Attorney-General's Department, A Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, September 2011, p. 50.
[120] Attorney-General's Department, A Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers, September 2011, p. 52.
[121] See also Australian Law Reform Commission, Traditional Rights and Freedoms – Encroachments by Commonwealth Laws (ALRC Report 129), December 2015, p. 284.
[122] Statement of compatibility with human rights, pp. 10-11.
[123] Schedule 1, item 9, proposed subsection 22(8A). The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(iv).
[124] Explanatory memorandum, p. 40; namely, that functions and powers conferred under proposed subsection 22(8A) could relate to the purpose of ensuring compliance with matters set out in the environmental watering plan.
[125] Schedule 1, item 14, proposed section 73L and 73M; item 67, proposed sections 215V, 215Y and 215Z; item 148, proposed sections 239AA, 239AE and 239AF. The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(v).
[126] See proposed subsection 215Z(5).
[127] Proposed sections 73L and 73M.
[128] Proposed section 215Y.
[129] Proposed sections 239AE and 239AF.
[130] Proposed section 215V.
[131] Schedule 1, item 67, proposed subsection 215V(3). The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(v).
[132] Explanatory memorandum, p. 70.
[133] Schedule 1, item 14, proposed paragraph 73L(2)(b).
[134] Schedule 1, item 148, proposed subsection 239AA(7).
[135] Schedule 1, item 67, proposed subsection 215V(5).
[136] Schedule 1, item 67, proposed section 215W. The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(ii).
[137] Explanatory memorandum, pp. 71-72.
[138] Schedule 1, item 67, proposed paragraph 222G(5)(a). The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(iv).
[139] Proposed subsection 222G(4).
[140] Schedule 1, item 148, proposed subsection 239AG(3). The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(i).
[141] Schedule 3, item 2, proposed subsection 18C(2A). The committee draws senators’ attention to this provision pursuant to Senate Standing Order 24(1)(a)(v).
[142] Explanatory memorandum, p. 118.
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