Primary Industries Levies and Charges Collection Bill 2023 - Initial Scrutiny [2023] AUSStaCSBSD 206 (8 November 2023)

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Purpose	The bill seeks to establish a collection and compliance framework for levies and charges collected under the agriculture levy system.
Portfolio	Agriculture, Fisheries and Forestry
Introduced	House of Representatives on 18 October 2023
Bill status	Before the House of Representatives

Coercive powers
Infringement notices
Broad delegation of administrative powers^[38]

1.72 Clause 20 seeks to empower a compliance officer to exercise a range of monitoring powers under Part 2 of the Regulatory Powers (Standard Provisions) Act 2014 (the Regulatory Powers Act) in relation to: the provisions of this bill or the rules; or an offence against the Crimes Act 1914 (Crimes Act) or the Criminal Code 1995 (Criminal Code) that relates to this bill or its rules.

1.73 Subclause 20(10) seeks to provide that a compliance officer can be assisted by other persons in carrying out their duties or functions under the Regulatory Powers Act in relation to the bill. Subclause 20(11) seeks to provide that both an authorised person and a person assisting can use such force against things as is necessary and reasonable in the circumstances.

1.74 Clause 21 of the bill seeks to provide a mirroring provision enabling the investigatory powers in Part 3 of the Regulatory Powers Act to apply in relation to the bill's offence and civil offence provisions, and offences against the Crimes Act or the Criminal Code that relate to this bill or its rules.

1.75 Clause 23 of the bill seeks to provide that the following provisions of the bill are subject to an infringement notice under Part 5 of the Regulatory Powers Act:

1.76 Further, subclause 23(2) seeks to provide that for the purposes of Part 5 of the Regulatory Powers Act, a compliance officer is an infringement officer.

1.77 Clause 4 of the bill seeks to define a compliance officer as either the Secretary or an Australian Public Service (APS) employee in the department appointed by the Secretary under clause 52 of the bill.

1.78 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 as to why these are considered necessary should be included in the explanatory memorandum.

1.79 The explanatory memorandum to the bill does not explain or justify why it is necessary and appropriate for a compliance officer to be any APS employee in the department, regardless of their position, skills, experience or qualifications. In relation to the person assisting a compliance office, the explanatory memorandum notes that other persons may be needed to assist compliance officers if:

1.80 While this appears to justify why the authorisation may be needed from a practical perspective, it does not provide any information about safeguards or limits as to who an assisting person may be.

1.81 The committee's concerns in relation to this broad delegation are heightened due to the coercive nature of the powers which permit compliance officers and persons assisting to use such force against things as is necessary and reasonable in the circumstances.

1.82 In relation to authorised officers issuing infringement notices, the Attorney-General's Department's A Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers (Guide to Framing Commonwealth Offences) states:

The legitimacy of an infringement notice scheme depends on the existence of a properly managed process for the issuing of notices. This includes ensuring that notices are only issued by those authorised to issue notices and that there is proper accountability for the exercise for those powers.

A common approach is to require that the person issuing the notice possess special attributes, qualifications or qualities. A provision that allows 'a person' or 'an APS employee' to issue a notice is likely to be inappropriate. Further, if the power to issue a notice can be delegated, the delegation should be restricted to persons of suitable seniority and expertise.^[40]

1.83 As noted above, in this instance a compliance officer and therefore, an infringement officer can be any APS employee of the department appointed under clause 52 of the bill.

1.84 The committee's view is that an infringement officer for the purposes of the bill should be limited to APS employees who possess the appropriate skills, knowledge and qualifications to perform these functions and duties. However, in this regard, there is no further guidance in the explanatory memorandum to clarify who it is envisaged a compliance officer may be, and it is therefore difficult for the committee to assess the appropriateness of this authorisation.

Privacy^[41]

1.86 Division 3 of Part 5 of the bill seeks to set out authorised uses and disclosures of relevant levy/charge information. Levy/charge information is defined in clause 4 as information obtained by a person under the bill or rules, or obtained or generated by a person in the course of administering the bill or rules, or assisting another person to do so.

1.87 A note to Division 3 confirms that each provision in Division 3 that authorises the use or disclosure of information would also provide an authorisation for the purposes of the Privacy Act 1988 (Privacy Act) and other laws.

1.88 There are a range of proposed authorised disclosures of levy/charge information by entrusted persons set out in Division 3. These would include: disclosures in the process of administering the bill^[42]; disclosures to Commonwealth entities^[43]; disclosures under other laws^[44]; disclosures for law enforcement^[45]; and other purposes.

1.89 Of these provisions, only two types of disclosures (permitted by clause 28) would be prevented from disclosing personal information, as per subclause 28(4). This is in relation to information disclosed for agricultural research and policy, and information disclosed by staff for the performance of functions of the Australian Bureau of Agricultural and Resource Economics and Sciences under subclauses 28(2) and (3).

1.90 Secondary use of information received by a declared recipient body or a statutory recipient body under clause 32 would also be permitted for a range of specified purposes under clause 42, such as for maintaining a register of levy or charge payers.

By requiring persons to provide information or documents, the Bill may incidentally require the provision of personal information.^[46]

1.92 The committee welcomes the safeguards provided in relation to the application of the Privacy Act and the Australian Privacy Principles. From the information provided in the explanatory memorandum, it appears to the committee that personal information may therefore be required to be collected and disclosed under proposed Division 3 of Part 5. However, the scope of the personal information that may be captured under this division is unclear. It is also unclear whether personal information could be captured within the definition of levy/charge information.

1.93 In light of the above the committee requests the minister's advice as to:

Reversal of the evidential burden of proof^[47]

1.94 Subclause 45(1) proposes to prescribe a criminal offence when an entrusted person has obtained or generated information for the purposes of administering or assisting a person to administer the bill or the rules, the information is commercially sensitive the disclosure of which could reasonably be expected to found an action by a person for a breach of a duty of confidence, and the entrusted person uses or discloses the information. The offence carries a maximum penalty of 12 months imprisonment.^[48]

1.95 Subclauses 45(4) and (5) set out proposed offence-specific defences for the offences in subclauses 45(1) and (2). Subclause 45(4) seeks to provide that the offences do not apply if the use or disclosure of the information is required or authorised by the bill or another Commonwealth law, or a law of a State or Territory prescribed by the rules made for the purposes of this paragraph. Subclause 45(5) seeks to provide that the offences do not apply if the person uses or discloses the information in good faith for the purposes of administering or assisting a person to administer the bill or the rules, or monitoring compliance or assisting a person to monitor compliance with the bill or the rules. A note to each subclause confirms that the evidential burden of proof is reversed in relation to each of these proposed defences.

1.96 At common law, it is ordinarily the duty of the prosecution to prove all elements of an offence.^[49] 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, interfere with this common law right.

1.97 The committee notes that the Guide to Framing Commonwealth Offences^[50] 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:

1.98 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. The explanatory memorandum states:

A person who seeks to rely on the exceptions in subsection 45(4) or (5) bears the evidential burden of proving the exception. These defences reverse the usual burden of proof because the relevant matters would be peculiarly within the knowledge of the defendant. It would be significantly more difficult and costly for the Commonwealth (as the prosecution or applicant) to prove the relevant matters. Information about which law the defendant was purporting to rely on or whether the defendant acted in good faith in using or disclosing the information would be peculiarly within the knowledge of the defendant, who would be expected to understand their reasons for disclosure.

The reversal of the evidential burden of proof in relation to these defences is consistent with general principles of criminal responsibility. Under subsection 13.3(3) of the Criminal Code, a defendant who wants to rely on any exception, provided by the law creating an offence, bears an evidential burden in relation to that matter. The exception need not accompany the description of the offence.^[52]

1.99 In this case, it is not apparent that the matters in proposed subclause 45(4) are matters peculiarly within the defendant's knowledge, or that it would be significantly more difficult or costly for the prosecution to establish the matters than for the defendant to establish them. For example, whether or not conduct is authorised by the bill, its rules, or a Commonwealth or State or Territory law is not, in the committee's view, a matter that is peculiarly within the defendant's knowledge. Further, the explanatory memorandum does not justify why the prosecution would not be able to obtain this information. While it may be more difficult and costly for the prosecution to do so, this does not in and of itself equate to these matters being peculiarly within the knowledge of the defendant.

1.100 In relation to the defence in proposed subclause 45(5) for good faith, the committee notes that this is a subjective term and whether or not a defendant acted in good faith is open to interpretation. The explanatory memorandum does not provide any further guidance or discussion as to matters or factors that may go towards indicating that a defendant has acted in good faith in this context.

1.101 These matters therefore appear to be matters more appropriately included as an element of the offence.

1.102 The committee requests the minister's advice as to why it is proposed to use an offence-specific defence for the criminal offence in subclause 45(1).

1.103 The committee suggests that it may be appropriate for the bill to be amended to provide that these matters are specified as elements of the offence. The committee's consideration of the appropriateness of a provision which reverses the burden of proof is assisted by if it explicitly addresses relevant principles as set out in the Guide to Framing Commonwealth Offences.

Automated decision-making^[53]

1.104 Subclause 53(1) seeks to provide that the Secretary may arrange for the use, under the Secretary's control, of computer programs for any purpose for which the Secretary may, under the bill or the rules, make a decision of a kind specified in the rules for the purposes of this subsection. Subclause 53(2) would require the Secretary to take all reasonable steps to ensure that each decision made by a computer program is a decision the Secretary could validly make under the bill or rules. Subclause 53(4) also seeks to provide that the Secretary may substitute a computer-made decision if they are satisfied that the decision is not the correct or preferable decision.

1.105 The committee notes that administrative law typically requires decision-makers to engage in an active intellectual process in respect of the decisions they are required or empowered to make. A failure to engage in such a process—for example, where decisions are made by computer rather than by a person—may lead to legal error. In addition, there are risks that the use of an automated decision-making process may operate as a fetter on discretionary power, by inflexibly applying predetermined criteria to decisions that should be made on the merits of the individual case. These matters are particularly relevant to more complex or discretionary decisions, and circumstances where the exercise of a statutory power is conditioned on the decision-maker taking specified matters into account or forming a particular state of mind.

1.106 The committee notes that clause 48 of the bill provides for internal merits review of listed decisions made under the bill, and clause 49 also provides for external merits review by the Administrative Appeals Tribunal of listed decisions. For example:

1.107 That provision has been made for these listed decisions made under the bill to be both internally and externally reviewable indicates that these decisions are complex and discretionary, and are therefore, more vulnerable to legal error due to the imposition of automated decision-making.

1.108 In relation to the use of automated decision-making, the explanatory memorandum states:

The inclusion of this provision provides flexibility to automate the making of suitable decisions as technology advances in the future. Decisions made by computers, where appropriate, can provide greater speed and consistency, provide cost-effectiveness and reduce administrative burden. Given the cost-recovered nature of administration of the agricultural levy system, using computer programs for appropriate decisions could result in greater availability of levy funds for disbursement.

It is intended that any arrangement made by the Secretary for the use of computer programs would be documented to provide clarity and accountability.

Subsection 53(2) would be a safeguarding provision to provide that the Secretary must take all reasonable steps to ensure that each decision made by the operation of a computer program under an arrangement made under subsection 53(1) is a decision that the Secretary could validly make under the Act or the rules.^[54]

1.109 The committee notes that proposed subclause 53(1) provides that the rules will specify which decisions made under the bill will be subject to automated decision-making. In light of the potential effects on administrative decision-making outlined above, the committee is of the view that none of the decisions listed in clauses 48 and 49 may be appropriate for automated decision-making.

1.110 The committee notes that it would be useful for the explanatory materials to explain how automated decision-making will comply with relevant administrative law requirements (for example, the requirement to consider relevant matters and the rule against fettering of discretionary power).

1.111 As the explanatory materials do not appear to adequately address this matter, the committee requests the minister's detailed advice as to:

Vicarious liability^[55]

1.112 Subclause 56(1) seeks to provide that the bill and the rules apply to a partnership as if it were a person. Subclause 56(4) seeks to provide that an offence against the bill or rules is taken to have been committed by each partner in the partnership who, at the time of the offence, did the conduct or act, aided, abetted, counselled or procured the relevant act or omission, or was in any way knowingly concerned in, or party to, the relevant act or omission whether directly or indirectly. Subclause 56(5) seeks to provide a mirror provision for the contravention of civil penalties in the bill and rules.

1.113 Clause 57 is a mirror provision seeking to impose vicarious liability in relation to trusts, and clause 58 is a mirror provision seeking to impose vicarious liability in relation to unincorporated bodies or associations.

1.114 Vicarious liability is the liability imposed on one person for the wrongful act of another on the basis of the legal relationship between them. Clauses 56, 57 and 58 appear to impose vicarious liability on other members of the partnerships, trusts or unincorporated bodies or associations. The Guide to Framing Commonwealth Offences states that 'vicarious, collective or deemed liability should only be used in situations where it can be strictly justified...this is because it cuts across the fundamental principle that an individual should be responsible only for his or her own acts and omissions'.^[56]

1.115 The committee has consistently taken the view that vicarious liability should only be used where the consequences for the offence are so serious that the normal requirement for proof of fault can be put aside.

1.116 In this instance, there is nothing in the explanatory memorandum which explains why it is necessary and appropriate for vicarious liability to be imposed in this context.

1.117 As neither the statement of compatibility nor the explanatory memorandum address this issue, the committee seeks the minister's advice as to the rationale for imposing vicarious liability in clauses 56, 57 and 58, and whether the principles identified in the Guide to Framing Commonwealth Offences^[57] have been considered.

Parliamentary oversight

1.118 Clause 59 of the bill would empower the secretary to make rules under the bill by way of legislative instrument. In addition, subclause 59(4) would provide that the rules may also confer on the minister or the secretary a power to make a legislative instrument, a notifiable instrument or other written instrument.

Subsection 59(4) would provide that the rules may confer instrument making powers on the Minister or the Secretary. This power could be exercised for procedural matters, for example, enabling approved forms under the rules. This provision would also allow for future collection rules to be made as Australia’s agricultural, fisheries and forestry sectors grow and change.^[58]

1.120 The committee notes that notifiable instruments are not subject to the tabling, disallowance or sunsetting requirements that typically apply to legislative instruments. As such, there would be no parliamentary scrutiny of any notifiable instruments made by the minister or secretary under the rules as provided by subclause 59(4).

1.121 The committee is of the view that the power to create further non-legislative instruments is more appropriate for inclusion on the face of the bill to allow for appropriate parliamentary consideration and oversight.

1.122 In light of the above, the committee requests the minister’s advice as to whether the bill can be amended to provide the power for the minister or secretary to make notifiable and other written non-legislative instruments on the face of the bill.

^[38] Clauses 20, 21 and 23. The committee draws senators' attention to these provisions pursuant to Senate standing order 24(1)(a)(i) and (ii).

^[41] Part 5, Division 3. The committee draws senators' attention to these provisions pursuant to Senate standing order 24(1)(a)(i).

^[47] Clause 45. The committee draws senators' attention to these provisions pursuant to Senate standing order 24(1)(a)(i).

^[48] Subclause 45(2) provides a mirror civil offence with a maximum penalty of 60 penalty units.

^[49] Subsection 13.3(3) of the Criminal Code provides that a defendant who wishes to rely on any exception, exemption, excuse, qualification or justification bears an evidential burden in relation to that matter.

^[53] Clause 53. The committee draws senators' attention to this provision pursuant to Senate standing order 24(1)(a)(iii).

^[55] Clauses 56, 57 and 58. The committee draws senators' attention to these provisions pursuant to Senate standing order 24(1)(a)(i).

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