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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 modernise and streamline social security law to support
the New Employment Services Model, which will operate from
July 2022
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Portfolio
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Education, Skills and Employment
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Introduced
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House of Representatives on 27 May 2021
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Bill status
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Before the House of Representatives
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2.80 In Scrutiny Digest 8 of 2021 the committee requested the minister's advice regarding:
• why it is considered necessary and appropriate that all determinations made under proposed section 40T are not legislative instruments; and
• whether the bill could be amended to provide that these determinations are legislative instruments to ensure that they are subject to appropriate parliamentary oversight.[37]
Minister's response[38]
2.81 The minister advised:
Section 40T relates to exceptional circumstances in which classes of people will not be required to satisfy the employment pathway plan requirements if a determination to that effect is made. As stated in the explanatory memorandum, where there are circumstances such as bushfires or pandemics “there is a need for job seekers to receive timely information in advance as to whether they will need to meet mutual obligation requirements”. This is not merely a matter of administrative flexibility – job seekers need timely information in advance, so they do not expose themselves to danger, for example due to bushfires, due to uncertainty about whether they need to meet requirements.
The usual tabling and disallowance processes are inconsistent with this, due to the potential for emergency situations to evolve rapidly and unpredictably in many areas simultaneously, as noted in the explanatory memorandum. While not all exceptional circumstances which might fall within the scope of section 40T will constitute health or safety emergencies, they may nonetheless evolve rapidly. Classes of job seekers who are affected by the exceptional circumstances need timely information in advance about their obligations, so they are not exposed to unnecessary stress or anxiety in connection with whether they need to meet requirements.
Accordingly, it is appropriate that the Bill provides that determinations under section 40T are not legislative instruments.
Committee comment
2.82 The committee thanks the minister for this response. The committee notes the minister's advice that it is appropriate that determinations made under proposed section 40T are not legislative instruments because the determinations relate to exceptional circumstances which will require job seekers to receive advance, timely information as to their employment pathway plan obligations. The minister advised that without this advance notice, jobseekers may be exposed to dangerous emergency situations, including bushfires, and to unnecessary stress or anxiety in connection with whether they need to meet requirements.
2.83 The minister advised that due to the potential for emergency situations to evolve rapidly and unpredictably in many areas simultaneously, it would be inappropriate to subject determinations made under proposed 40T to the usual tabling and disallowance processes.
2.84 The committee thanks the minister for his considered engagement with this issue noting the importance of subjecting instruments to the usual parliamentary scrutiny processes. This issue has been highlighted recently in the committee's review into the Biosecurity Act 2015,[39] the inquiry of the Standing Committee for the Scrutiny of Delegated Legislation into the exemption of delegated legislation from parliamentary oversight,[40] and a resolution of the Senate on 16 June 2021 emphasising that delegated legislation should be subject to disallowance and sunsetting to permit appropriate parliamentary scrutiny and oversight unless there are exceptional circumstances.[41]
2.85 While acknowledging the minister's advice, the committee notes that it does not generally consider that a need for urgency is a sufficient justification for the removal of the usual parliamentary oversight processes. In this regard, the committee notes that legislative instruments that are subject to disallowance can commence immediately after they are registered,[42] that disallowance may only occur after the instrument is tabled in Parliament, that disallowance operates prospectively and therefore does not invalidate actions taken under the instrument prior to the time of disallowance, and that disallowances themselves are rare. Similarly, the committee notes that neither the tabling nor sunsetting requirements that legislative instruments are subject to impact upon the ability of an instrument to commence immediately.
2.86 The committee reiterates the scrutiny position adopted by the Standing Committee for the Scrutiny of Delegated Legislation that:
delegated legislation made during emergencies must be subject to parliamentary oversight with minimal exceptions. This approach ensures respect for Parliament's constitutional role as the primary institution responsible for making law and scrutinising possible encroachments on personal rights and liberties.[43]
2.87 The committee notes that a lack of disallowance undermines the ability of Parliament to properly undertake its scrutiny functions and may subvert the appropriate relationship between the Parliament and the executive, impacting upon Parliament's constitutional role as lawmaker-in-chief.
2.88 As such, the committee does not consider that the minister has adequately addressed the committee's scrutiny concerns.
2.89 In light of the committee’s continuing scrutiny concerns outlined above, the committee requests the minister's further advice regarding:
• why it is considered necessary and appropriate that all determinations made under proposed section 40T are not legislative instruments; and
• whether the bill could be amended to provide that these determinations are legislative instruments to ensure that they are subject to appropriate parliamentary oversight.
2.90 In Scrutiny Digest 8 of 2021 the committee requested the minister's advice as to:
• why it is considered necessary and appropriate to confer on the Employment Secretary a broad power to make arrangements and grants in circumstances where there is limited guidance on the face of the bill as to how that power is to be exercised;
• whether the bill can be amended to include at least high-level guidance as to the terms and conditions on which arrangements or grants can be made; and
• whether the bill can be amended to include a requirement that written agreements with the states and territories about arrangements or grants made under proposed section 1062A are:
• tabled in the Parliament within 15 sitting days after being made; and
• published on the internet within 30 sitting days after being made.[45]
Minister's response
2.91 The minister advised:
Why it is considered necessary and appropriate to confer on the Employment Secretary a broad power to make arrangements and grants in circumstances where there is limited guidance on the face of the bill as to how that power is to be exercised
Schedule 2 relates to legislative authority for spending on the same sort of employment programs for which various Financial Framework (Supplementary Powers) Regulations 1997 items currently authorise spending.
Section 32B of the Financial Framework (Supplementary Powers) Act 1997 means that the Commonwealth has the power to make, vary or administer an arrangement or grant for the purpose of programs specified in the FFSP Regulations. Subsection 32B(2) means that this power can be exercised on behalf of the Commonwealth by an accountable authority of a non-corporate Commonwealth entity, for example the Employment Secretary. The power to make arrangements and grants in Schedule 2 reproduces the power which already exists in section 32B.
As noted in the explanatory memorandum, all the usual processes for the establishment and oversight of such programs, such as the need to comply with the Commonwealth procurement and grants frameworks, will remain unchanged.
It is therefore necessary and appropriate for Schedule 2 to include this power.
Whether the bill can be amended to include at least high-level guidance as to the terms and conditions on which arrangements or grants can be made
The Department of Education, Skills and Employment (the department) ensures that relevant arrangements or grants are made consistently with the Public Governance, Performance and Accountability Act 2013 and with value for money and other requirements in the Commonwealth procurement and grants frameworks.
The department also ensures that arrangements or grants are subject to robust conditions proportionate to the amounts and issues involved. The longstanding practice of the department in relation to jobactive and other sizable employment programs has been that employment service providers must enter deeds with the department which contain extensive terms and conditions. For example, the jobactive deed is 258 pages and also requires providers to comply with around a dozen guideline documents under the deed.
Such an amendment is therefore not necessary, and would not add to the effective administration of the arrangements or grants.
Whether the bill can be amended to include a requirement that written agreements with the states and territories about arrangements or grants made under proposed section 1062A are:
• tabled in the Parliament within 15 sitting days after being made; and
• published on the internet within 30 sitting days after being made.
The department’s practice is to widely publicise employment programs for which it administers funds and this will continue, in addition to the requirement in new section 1062D to include information about the number and total amounts paid under arrangements and grants made, whether to state or territories or otherwise, in its annual report. In addition, it may be that some agreements will contain confidential or sensitive information which it would not be appropriate to publish. The current provisions of the Bill are therefore appropriate.
Committee comment
2.92 The committee thanks the minister for this response. The committee notes the minister's advice that the legislative authority for spending provided by Schedule 2 to the bill is for the same type of employment programs as are already authorised by various provisions within the Financial Framework (Supplementary Powers) Regulations 1997. The minister also advised that the usual processes for the establishment and oversight of these programs, such as the need to comply with the Commonwealth procurement and grants frameworks, will remain unchanged.
2.93 While acknowledging this advice, the committee has generally not accepted consistency with existing legislation or the existence of non-legislative policy guidelines to be sufficient as a justification for the conferral of broad powers in circumstances where there is limited guidance on the face of the bill as to how those powers are to be exercised.
2.94 It remains unclear to the committee why at least high-level guidance cannot be included on the face of the bill as to the exercise of powers under proposed sections 1062A and 1062B.
2.95 The committee notes the minister's advice in relation to amending the bill to include tabling requirements for agreements made under proposed section 1062A that the department's current practice is to widely publicise employment programs for which it administers funds and that this will continue in relation to proposed section 1062A. The minister also noted that agreements made under proposed section 1062A may contain confidential or sensitive information which it would not be appropriate to publish.
2.96 The committee notes that the process of tabling documents in Parliament alerts parliamentarians to their existence and provides opportunities for debate that are otherwise not available. The committee does not consider that public consultation is sufficient to address the committee's scrutiny concerns relating to not providing for agreements with the states and territories to be tabled in the Parliament.
2.97 The committee draws its scrutiny concerns to the attention of senators and leaves to the Senate as a whole the appropriateness of:
• conferring on the Employment Secretary a broad power to make arrangements and grants relating to assisting persons to obtain and maintain paid work in circumstances where there is limited guidance on the face of the bill as to how that power is to be exercised; and
• not including a requirement that written agreements with the states and territories about arrangements or grants made under proposed section 1062A be tabled in the Parliament.
2.98 In Scrutiny Digest 8 of 2021 the committee requested the minister's advice as to:
• why it is considered appropriate that instruments made under proposed subsection 8(8AC) and proposed subsection 40(3) are not legislative instruments; and
• whether the bill could be amended to provide that these instruments are legislative instruments to ensure that they are subject to appropriate parliamentary oversight.[47]
Minister's response
2.99 The minister advised:
Subsection 8(8AC) authorises the Employment Secretary to determine, by notifiable instrument, payments and benefits from Commonwealth and State and Territory employment programs to not be considered income for social security law purposes. Subsection 40(3) authorises the Employment Secretary to determine, by notifiable instrument, employment programs which do not give rise to employment for the purposes of certain industrial relations legislation.
The proposed instruments reflect the need to be able to rapidly vary administrative arrangements in response to changing programs - including in response to emergencies or rapid creation of new programs. This could include new programs needed rapidly in response to sudden industry downturns, or mass lay-offs. I therefore consider that the provisions of the Bill in relation to these instruments are appropriate.
The instrument under 8(8AC) will allow job seekers to keep any assistance from these programs, without needing to declare it as income to Services Australia. The instrument under subsection 40(3) will allow job seekers to participate in these programs without needing to have the participation directly entered into their Job Plan.
Committee comment
2.100 The committee thanks the minister for this response. The committee notes the minister's advice that the proposed instruments reflect the need to be able to rapidly vary administrative arrangements in response to changing programs, including in response to emergencies or the rapid creation of new programs.
2.101 As noted above, the committee does not generally consider that a need for urgency is a sufficient justification for the removal of the usual parliamentary oversight processes. In this regard, the committee notes that legislative instruments that are subject to disallowance can commence immediately after they are registered,[48] that disallowance may only occur after the instrument is tabled in Parliament, that disallowance operates prospectively and therefore does not invalidate actions taken under the instrument prior to the time of disallowance, and that disallowances themselves are rare. Similarly, the committee notes that neither the tabling nor sunsetting requirements that legislative instruments are subject to impact upon the ability of an instrument to commence immediately.
2.102 The committee also reiterates that Schedule 5 to the bill seeks to amend subsection 28(1) of the Social Security Act 1991 to provide that declarations by the Secretary that particular programs of work are approved programs of work for income support payment will be legislative instruments. Noting the similarity in the types of determinations being made, it remains unclear to the committee why determinations under proposed subsection 8(8AC) and proposed subsection 40(3) cannot be legislative instruments.
2.103 The committee therefore does not consider that the minister has provided information that adequately justifies why instruments under proposed subsection 8(8AC) and proposed subsection 40(3) are not legislative instruments.
2.104 In light of the committee’s continuing scrutiny concerns outlined above, the committee requests the minister's further advice as to:
• why it is considered appropriate that instruments made under proposed subsection 8(8AC) and proposed subsection 40(3) are not legislative instruments; and
• whether the bill could be amended to provide that these instruments are legislative instruments to ensure that they are subject to appropriate parliamentary oversight.
[36] Schedule 1, item 123, proposed sections 40T and 40U. The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(v).
[37] Senate Scrutiny of Bills Committee, Scrutiny Digest 8 of 2021, pp. 40–41.
[38] The minister responded to the committee's comments in a letter dated 24 June 2021. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 10 of 2021 available at: www.aph.gov.au/senate_scrutiny_digest.
[39] Scrutiny Digest 7 of 2021, chapter 4, pp. 33-44.
[40] Senate Standing Committee for the Scrutiny of Delegated Legislation, Inquiry into the exemption of delegated legislation from parliamentary oversight: Interim report, December 2020; and Inquiry into the exemption of delegated legislation from parliamentary oversight: Final report, March 2021.
[41] Journals of the Senate, 16 June 2021, pp. 3581–3582.
[42] See, for example, Financial Framework (Supplementary Powers) Amendment (Prime Minister and Cabinet Measures No. 3) Regulations 2021 [F2021L00967].
[43] See Senate Standing Committee for the Scrutiny of Delegated Legislation, Inquiry into the exemption of delegated legislation from parliamentary oversight: Interim report, 2 December 2020, p. xiii.
[44] Schedule 2, item 2, proposed sections 1062A and 1062B. The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(ii) and (v).
[45] Senate Scrutiny of Bills Committee, Scrutiny Digest 8 of 2021, pp. 41–43.
[46] Schedule 4, item 2, proposed subsection 8(8AC) and Schedule 6, item 1, proposed subsection 40(3). The committee draws senators’ attention to these provisions pursuant to Senate Standing Order 24(1)(a)(v).
[47] Senate Scrutiny of Bills Committee, Scrutiny Digest 8 of 2021, pp. 43–44.
[48] See, for example, Financial Framework (Supplementary Powers) Amendment (Prime Minister and Cabinet Measures No. 3) Regulations 2021 [F2021L00967].
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