Scrutiny of Acts and Regulations Committee

Sixth Annual Report,
May 1999

Ordered to be printed
By Authority.  Government Printer for the State of Victoria.
No. 47 Session 1999

2.1 The Scrutiny of Bills – Terms of Reference

The Terms of Reference of the Scrutiny of Acts and Regulations Committee are set out in section 4D of the Parliamentary Committees Act 1968:–

(a) to consider any Bill introduced into a House of the Parliament and to report to the Parliament as to whether the Bill, by express words or otherwise –

(i) trespasses unduly upon rights or freedoms; or
(ii) makes rights, freedoms or obligations dependent upon insufficiently defined administrative powers; or
(iii) makes rights, freedoms or obligations dependent upon non-reviewable administrative decisions; or
(iv) inappropriately delegates legislative power; or
(v) insufficiently subjects the exercise of legislative power to parliamentary scrutiny; and

(b) to consider any Bill introduced into a House of the Parliament and to report to the Parliament –

(i) as to whether the Bill by express words or otherwise repeals, alters or varies section 85 of the Constitution Act 1975, or raises an issue as to the jurisdiction of the Supreme Court;
(ii) where a Bill repeals, alters or varies section 85 of the Constitution Act 1975, whether this is in all the circumstances appropriate and desirable; or
(iii) where a Bill does not repeal, alter or vary section 85 of the Constitution Act 1975, but where an issue is raised as to the jurisdiction of the Supreme Court, as to the full implications of that issue; and

(c) such functions as are conferred on the Committee by the Subordinate Legislation Act 1962; and
(ca) such functions as are conferred on the Committee by the Environment Protection Act 1970; and
(d) to review any Act where required so to do by or under this Act, in accordance with terms of reference under which the Act is referred to the Committee.

2.2 The Scrutiny of Bills – Overview

During 1998 the Committee held 8 (eight) meetings to consider the 105 bills introduced into the Parliament. Whilst the Committee did not hold public hearings in relation to any of the bills considered during the year, it did receive written submissions in respect to a number of bills and an oral submission from representatives of `Defenders on Native Title' in respect to the Land Titles Validation (Amendment) Bill (reported at page 176 of the Cumulative Alert Digests for 1998).

2.3 Section 85 of the Constitution Act 1975

In 1998, 17 of the 105 bills (16%) considered by the Committee contained provisions pursuant to section 85 of the Constitution Act 1975. This compares with 17 of 103 bills (15.5%) in 1997 and 17 of 110 bills (16.5%) in 1996. In 1998 the Committee had only
2 (two) occasions to comment adversely, in relation to the Gas Pipelines Access (Victoria) Bill reported in Digest No. 3 and the Melbourne and Olympic Parks (Amendment) Bill reported in Digest No. 4. Both bills are referred to in greater detail in Chapter 3.

There were two occasions on which the Committee reported in relation to section 85 provisions where Ministers had inadvertently referred to the wrong clause numbers when making the mandatory section 85 statements in their Second Reading Speeches. These were in respect to the Appeals Costs Bill (Digest No. 7) and the Rail Corporation (Further Amendment) Bill (Digest No. 8). In both cases the Ministers concerned made further amending statements to rectify the error.

2.4 The Interpretation of Principles – Section 4D of the Parliamentary Committees Act 1968

2.4.1 Trespasses unduly upon rights or freedoms – Section 4D(a)(i)

The Committee considered this principle in respect of the following bills.

• Transport Accident (Amendment) Bill Digest No. 3
• Public Sector Management and Employment Bill Digest No. 4
• Land Titles Validation (Amendment) Bill Digest No. 8

Transport Accident (Amendment) Bill

The Minister's Second Reading Speech made it clear that the main purpose of the Bill was to introduce a revised approach to the measurement of impairment of persons injured as a result of transport accidents and to be consistent with the approach adopted by the Victorian WorkCover Authority under the Accident Compensation Act 1986. Clause 8 of the Bill amended section 46A to provide that assessment of the degree of impairment of a person injured in a transport accident will be made using the 4^th Edition of the American Medical Association Guides to the Evaluation of Permanent Impairment (the 4^th Edition Guide). The Committee did not report adversely on the provision made by the amendment to section 46A, however it did make the observation that in some instances entitlements may be diminished and in other instances they may be enhanced by the adoption of the 4^th Edition Guide.

Public Sector Management and Employment Bill

The purpose of the Bill was to provide for the management of the Victorian public sector. The Committee noted the comments in the Minister's Second Reading Speech:–

The purpose of this Bill is to continue the reform of the management of the Victorian Public Sector and to recognise the effect of the historic referral of Victoria's industrial relations powers to the Commonwealth. The new employment and management framework for the public sector will move the public service closer to the private sector, where terms and conditions of employment are governed by awards and agreements.

The Bill focuses on the principles that govern public sector employment and removes unnecessary detail on employment procedures.

After considerable discussion on the impact the Bill may have on public sector employment in Victoria the Committee was unable to reach an agreed position. In the only division of the year the Committee divided upon the motion moved by Mr Bob Cameron MLA:–

That this Bill trespasses on the rights of existing public servants by limiting the career opportunities across the (former) public service and a diminution of certainty of treatment over working conditions.

The motion was defeated by a majority of four Coalition members to three Labor members.

Land Titles Validation (Amendment) Bill

In Digest No. 8 the Committee dealt with the difficult issues arising from the amendments to the Land Titles Validation Act 1994 concerning the validation of certain `intermediate period acts' and confirming the effect on native title of certain acts and amending certain provisions of the Pipelines Act 1967. `Intermediate period acts' refer to acts occurring between the commencement of the operation of the Native Title Act 1993 (Cth) on 1 January 1994 and the High Court's decision in Wik Peoples v Queensland (1996) 141 ALR 129 handed down on 23 December 1996.

The Committee received written submissions from a number of individuals and organisations and additional oral evidence from the `Defenders of Native Title' prior to considering its position on the overall impact of the Bill on Native Title. The Committee recorded the following comments on the Bill:–

The Committee notes the evidence given before it on 9 November 1998 by Mr Sid Spindler and Mr Peter Lewis on behalf of `Defenders of Native Title' and the written submissions made to it by a number of interested individuals and organisations.

The Committee notes the High Court's decisions in Mabo(1), Mabo(2) and in Wik, relating to native title.

It further notes that Native Title Rights are property interests within the meaning of section 18 of the Property Law Act 1958 and that property interests are `rights' within the meaning of section 4D(a)(i) of the Parliamentary Committees Act 1968.

The Committee notes that the Bill confirms the total or partial extinguishment effect on native title of previous exclusive and non-exclusive acts respectively and validates `intermediate period acts' attributable to the State. The Committee recognises that this may effectively result in the extinguishment of certain native title rights and that the validation restores the legal force to State Acts which may have been legally ineffective in extinguishing native title during the intermediate period.

The Committee acknowledges that whilst the Bill provides for the `compulsory acquisition of property' it also provides for the payment of compensation to any affected native title holders. It may be that forms of compensation can ultimately incorporate reference to access to land but such provisions are not incorporated in the present Bill.

The Committee notes the comments in the Second Reading Speech by the Minister, concerning the need to provide legal certainty following the High Court's judgment in Wik, in respect to certain property interests.

It further notes that the provisions of the Bill are of a validating and/or declaratory nature dealing with State acts carried out in the past and that the Bill therefore has retrospective application and may lead to adverse outcomes for some affected native title holders.

The Committee refers the matter to Parliament for its consideration.

2.4.2 Retrospectivity – Section 4D(a)(i)

In respect to the scrutiny of legislation function where an act is altered or a new provision comes into force retrospectively, there may be a trespass on rights and freedoms or a potential breach of section 4D(a)(i). Typically the tasks of the Committee in carefully examining and evaluating retrospective legislation is to have regard to the following factors:–

• whether the retrospective provision is beneficial to persons other than the State;
• whether the retrospective provision imposes undue obligations or appear to adversely affect the rights and liberties of individuals;
• whether individuals or organisations have relied on the legislation to conduct their affairs or business and have a legitimate expectation under the legislation prior to the enactment of the retrospective provision(s);
• whether adequate public warning or announcement is made prior to the commencement of the retrospective provision(s); and
• whether the retrospective provision(s) correct inadvertent errors of a machinery of government or nomenclature character.

In accordance with its Terms of Reference, the Committee continues to routinely note and comment upon the retrospective effect of such provisions in it's periodic Alert Digests. During 1998 there were 14 bills which contained retrospective provisions. By comparison in 1997 there were only 6 bills containing retrospective provisions. It is the Committee's experience that in a vast majority of instances the retrospective application of provisions is justified and not objectionable in terms of any adverse impact on persons. In such cases the Committee merely notes the retrospective provision and makes no further comment. In 1998 the Bills were:–

• Heritage Rivers (Amendment) Bill Digest No. 3
• Catchment and Land Protection (Amendment) Bill Digest No. 4
• State Taxation (Amendment) Bill Digest No. 4
• Arts Acts (Amendment) Bill Digest No. 6
• Health Services (Further Amendment) Bill Digest No. 6
• Mutual Recognition (Victoria) Bill Digest No. 6
• Accident Compensation (Amendment) Bill Digest No. 7
• Education (Amendment) Bill Digest No. 7
• Superannuation Acts (Amendment) Bill Digest No. 7
• Trade Measurement (Administration)(Amendment) Bill Digest No. 7
• Crimes, Confiscation and Evidence Acts (Amendment) Bill Digest No. 8
• Gas Industry Acts (Amendment) Bill Digest No. 8
• Licensing and Tribunal Bill Digest No. 8
• State Taxation (Further Amendment) Bill Digest No. 8

The Committee had occasion to refer retrospective application clauses for further comment by the responsible Minister in the following cases:–

State Taxation (Amendment) Bill

The Bill amended the definition of `coastal waters` in the Pay-roll Tax Act 1971 to provide that wages which are earned within the coastal waters of Victoria be assessable for pay-roll tax. The intention was to prevent future avoidance of pay-roll tax earnings within the coastal waters and achieve consistency with pay-roll tax legislation in other States. The legislation was deemed to have commenced on 1 January 1998 and thereby imposed an additional retrospective tax burden on individuals. The Committee wrote to the Minister concerning the retrospective imposition of this tax. The Minister responded as follows:–

The decision was made in December last year that the measure would take effect from
1 January 1998 only on the basis that the taxpayers and industry association affected by the measure would be notified of the legislative change before the commencement date.

The State Revenue Office notified by letter on 22 and 23 December the following individuals and organisations:

(the letter listed 12 companies/organisations)

In all cases, the advice was faxed to the recipient, to ensure that it was received promptly.

A copy of the attachment sent out with each letter is included, along with an acknowledgment from the Australian Petroleum Production and Exploration Association (APPEA) detailing the further distribution of the advice from the State Revenue Office.

The Committee therefore felt that the provision was not objectionable and met the criteria of advance and sufficient notice given to effected individuals or organisations prior to the retrospective date.

Gas Industry Acts (Amendment) Bill

The Bill made amendments to the Gas Industry Act 1994. The Committee expressed concern that the amendments made by clauses 9, 10 and 17(3) applied retrospectively to
10 June 1998 and that no explanation was available to the Committee in either the Explanatory Memorandum or the Second Reading Speech as to the significance of the retrospective date; the purpose to be achieved by providing for the retrospective application of these three clauses; and the possible impact that retrospectivity may impose on individuals or organisations. The Committee wrote to the Minister to clarify the matter and reported the Minister's response in Alert Digest No. 1 of 1999.

2.4.3 Makes rights, freedoms or obligations dependent upon insufficiently defined administrative powers – Section 4D(a)(ii)

There was one Bill during 1998 that gave rise to a consideration of this principle by the Committee, the Electricity Safety Bill – Alert Digest No. 2 of 1998, concerning the width of the Minister's delegation provision.

Electricity Safety Bill

The relevant extract of the Committee's letter to the Minister is set out:–

Clause 11 is the delegation provision. The Committee notes that any function or power may be delegated "with the consent of the Minister" to "another person". Whilst the Committee appreciates that there has been an attempt to limit those to whom powers are to be delegated, its preference is for at least the class of persons to be specified.

Clause 164 inserts a new Part 3 and new clause 47E which is also a delegation provision. The Committee notes that whilst the powers which may be delegated are limited to those under the Part, they may in fact be delegated to any person or body. Again the Committee's preference is that the power of delegation be limited so that at least the class of persons who are to be the recipient of the powers is specified.

Minister's response

Thank you for your letter dated 8 April 1998. I note the Committee's concern over the delegation provisions contained in clauses 11 and 164 of the Bill.

With respect to clause 11, the Office of the Chief Electrical Inspector ("OCEI") was established as the regulator with primary responsibility for the maintenance of safety standards within the restructured electricity industry. The Electricity Safety Bill seeks to consolidate its powers and functions which are currently contained in separate pieces of legislation.

It should be noted that a number of other organisations will continue to play a significant role in the electricity industry, both in terms of the provision of assistance to the OCEI and through the exercise of their own functions. For example, the Victorian Police, Victorian WorkCover Authority or the various fire authorities may assist the OCEI with the investigation of electricity-related incidents.

In such instances, it may be possible to identify a benefit from a function or power that resides principally with the OCEI being performed by another agency. The legislative framework and the "allocation" of functions between agencies will be revised if it becomes apparent over time that a delegated function should be the principal responsibility of another agency.

Although it is currently possible to identify agencies as above, there may be as yet unforseen benefits from utilising the expertise of other agencies. Therefore, I suggest that the legislation should allow for this possibility and not restrict the delegation power to specific agencies.

Clause 164 makes consequential amendments to the Electricity Industry Act 1993 and allows for emergency responses should an event occur that may materially affect the safe, economical or effective supply of electricity. It is not appropriate to restrict the scope of the delegation provision as it is sometimes difficult, if not impossible to identify which organisation or agency is in the best position to mitigate a particular emergency situation. Any restriction on the scope of the power in this situation may prevent the best-equipped agency from dealing with it, or may delay an emergency response to an unpredictable situation.

Once again, it is possible to identify agencies such as the OCEI, the National Electricity Market Management Company or Victoria Police who would participate in an emergency strategy, but inappropriate to limit the scope of the delegation to these agencies only.

2.4.4 Makes rights, freedoms or obligations dependent upon non-reviewable decisions – Section 4D(a)(iii)

There were no Bills during 1998 that gave rise to a consideration of this principle by the Committee.

2.4.5 Inappropriately delegates legislative power – Section 4D(a)(iv)

The Committee considered three Bills during 1998 in relation to this principle, they were the:–

• International Transfer of Prisoners (Victoria) Bill Digest No. 4
• Gas Industry Acts (Amendment) Bill Digest No. 8
• Mutual Recognition (Victoria) Bill Digest No. 6 (this Bill also made amendments to the Mutual Recognition Act 1992 and the Trans-Tasman Mutual Recognition (Victoria) Act 1998).

The first two Bills contained commencement by proclamation clauses and the third, an expiry by proclamation clause. As a guiding principle the Committee believes that the commencement and expiry of legislation is the exercise of legislative power and that therefore open-ended commencement or expiry clauses are undesirable, and have insufficient regard for the institution of Parliament. Where such provisions are deemed desirable their use should be clearly explained in the Second Reading Speech and the Explanatory Memorandum.

The Committee recognises that there are legitimate reasons for employing such commencement or expiry clauses for example, where uniform or National Schemes of Legislation require simultaneous commencement in a number of participating jurisdictions. However the Committee will continue to routinely draw these matters to Ministers' attention. A Minister's response ensures that the Parliament is kept informed in circumstances where at least technically a clause inappropriately delegates legislative power to the executive.

International Transfer of Prisoners (Victoria) – Minister's response

I refer to your letter of 13 May 1998 querying the departure in the International Transfer of Prisoners (Victoria) Bill 1998 from the standard practice of setting a fixed period after Royal Assent after which any unproclaimed provisions of the Act come into force.

You are correct in noting that the legislation is part of a Commonwealth and State government scheme and that this is the reason why the provisions of the Act other than Part 1 will come into effect only upon proclamation.

It may be some time yet before all State governments have passed the necessary legislation and before administrative arrangements are in place that will allow for the implementation of the international transfer scheme.

It is intended that Commonwealth and State legislation will be proclaimed simultaneously when all these matters are settled. It is for this reason that there is no set period after which unproclaimed provisions in the Act will come into force.

Gas Industry Acts (Amendment) Bill – Minister's response

I am aware of the Committee's Report entitled `Report on commencement by proclamation' dated 19 April 1993 and support the recommendations contained therein. In this instance, the absence of an explanation in the Explanatory Memorandum of the reasons why section 13(2) of the Amendment Act is unable to commence by a named date was an oversight within my Department.

As a result of a regulatory approval process undertaken in accordance with the Victorian Access Code made under section 48U of the Gas Industry Act 1994, changes have been required to the first Order made under section 48A(1) on 11 December 1997. At the time the Amendment Act was being prepared for introduction to Parliament it was unclear when the regulatory approval process would be completed. Consequently, the timing of making the amending Order (incorporating the then anticipated (and now realised) changes to the first Order was not ascertainable. As the commencement of section 13(2) of the Amending Act inserts a new sub-section (8) into section 48A, which sub-section prohibits the amendment of an Order made under 48A(1), it was not possible to prescribe a commencement date for section 13(2) of the Amending Act. In so far as section 13(2) of the Amending Act introduces a new section 48A(9), it is dependent upon the commencement of the insertion of the new section 48A(8).

The Order amending the first Order was made on 15 December 1998. Accordingly, I have asked for papers to be prepared recommending to the Governor-in-Council that section 13(2) of the Amending Act commence in early 1999. The potential mischief which the Committee's Report of April 1993 identified, that of an unacceptable delay in the starting of a provision of an Act which Parliament has thought fit to pass or even allowing the Executive to decline to bring into operation a provision of an Act which the Parliament has passed, will not occur in this case.

Mutual Recognition (Victoria) Bill – Minister's response

Thank you for your letter concerning the Mutual Recognition (Victoria) Bill and raising the issue of the proposal to terminate Victoria's adoption of the Commonwealth Mutual Recognition Act 1992 on a day fixed by the Governor-in-Council by proclamation in the Government Gazette.

I note your comments about the Scrutiny of Acts and Regulations Committee's view that the removal of a statute or a provision of a statute ought to be regarded as the exercise of legislative power and should be referred back to the Parliament for repeal.

My Government is committed to the principles of mutual recognition and has no intention of terminating Victoria's participation in the mutual recognition scheme. However, it is important to ensure that the Government has the utmost flexibility, should it be necessary to do so. A termination by proclamation clause was used at the time the Parliament referred legislative power in relation to industrial relations to the Commonwealth Parliament.

I also note your proposed alternative of a power to suspend the operation of a provision or provisions of the Act pending repeal at the next sitting. I have been advised that this proposal will not necessarily address your concern, in the event that a Government suspends the operation of a provision or provisions of the Act but does not introduce repealing legislation in the Parliament.

You will note that the termination by proclamation clause has bi-partisan support, as evidenced by the Leader of the Opposition's words during the debate on the Bill in the Legislative Assembly.

2.4.6 Insufficiently subjects the exercise of legislative power to Parliamentary Scrutiny – Section 4D(a)(v)

The Committee considered possible breaches of this principle in three Bills during 1998. In the first Bill the issue concerned the implementation of access to a natural gas pipeline system by the adoption of South Australian Legislation and the second and third bills regulation making powers allowing persons to be exempt from the operation of the Act or certain provisions of the Act (a `Henry VIII clause'). In the fourth bill the potential problem related to the incorporation by reference of the Commonwealth/State Medicare agreement into the Victorian legislation. In each case the Committee is concerned to ensure that there is adequate and proper Parliamentary scrutiny of legislation. The bills were:–

• Gas Pipelines Access (Victoria) Bill Digest No. 3
• Petroleum Bill Digest No. 6
• Consumer Credit (Finance Brokers) Bill Digest No. 6
• Health Services (Further Amendment) Bill Digest No. 6

Gas Pipelines Access (Victoria) Bill

The Bill applied the South Australian `Gas Pipelines Access Law' as a law of Victoria and also applied the regulations in force in South Australia as being in force in Victoria for the purposes of the Gas Pipelines Access (Victoria) Act 1998. The Committee had a number of concerns that are enumerated in the letter to the Minister as follows:–

Scrutiny of the legislation

The purpose of the Bill is to adopt the South Australian legislation. Whilst the Committee understands that the Bill forms part of a national scheme of legislation, it is difficult for it to fulfil its obligations under section 4D(a) of the Parliamentary Committees Act 1968 without sighting the South Australian Act. Whilst this is easily rectified from the Committee's point of view, it highlights the more general problem of scrutiny by the Parliament. The Committee is of the view that all Victorian legislation should be accessible. To this end, the Committee is of the view that the South Australian Act should form part of an appendix to the Victorian Bill so that at least there is some chance for members and the public to avail themselves of the state of the law.

Regulations

The Committee is also troubled at the prospect of the Victorian Parliament adopting binding regulations which are made interstate. Again, there is no chance of appropriate scrutiny or input. It seems to the Committee that this is not sound Parliamentary practice.

Delegation provisions

By way of example of insufficient scrutiny, the Committee notes that there are delegation provisions contained in the South Australian Act which may, if introduced directly in a Victorian Bill be of concern. The concerns relate to the width of the delegation provisions. As the South Australian legislation is already in force, there is little a Victorian Scrutiny Committee can do to articulate its concerns.

Section 85 of the Constitution Act 1975

Clause 23 of the Bill declares the intention of section 22 to alter or vary section 85 of the Constitution Act 1975. Clause 22 refers to Parts 5 and 6 of the South Australian Act which set out the administrative proceedings which may be commenced for any breaches of the law. The Committee notes that Parts 5 and 6 are not reproduced anywhere in the Bill.

Where a particular course is contemplated in Victorian legislation in terms of altering or varying the jurisdiction of the Supreme Court, a section 85 clause highlights that matter to the Parliament. The Committee is concerned about the concept of precluding the institution of proceedings in a Victorian Court in circumstances where the legislative provisions to which such proceedings might apply do not appear within the Bill and are therefore beyond scrutiny.

Continuing problem

By way of conclusion the Committee notes that as national schemes of legislation continue to increase in popularity and number, so too will the need to address these scrutiny issues. It would seem likely that such issues will continue to emerge in further areas of significance.

The Committee would grateful for your response in respect of these matters and indeed advice as to whether appropriate amendments may be made. The Committee would appreciate your response by no later than 9.00 am on Monday 28 April 1998 so that it can be incorporated into the next Alert Digest.

Please do not hesitate to contact me should you wish to discuss any of these matters.

The Minister's response

Thank you for your letter dated 21 April 1998. I note the Committee's concerns and address them in order below.

Before doing so, however, I wish to record the context in which your concerns are raised. The Bill represents the culmination of a process that began in 1994 when the Council of Australian Governments agreed to general principles of competition policy reform and, as part of that commitment, agreed to more specific proposals for the development of free and fair trade in natural gas. It was envisaged that, and still is now, that the implication of that agreement would result in significant benefits to the Victorian and National economies.

To achieve those benefits the governments of COAG have since agreed to the enactment of a uniform national legislative framework to apply for third party access to natural gas pipelines by way of an `application of laws' regime. Whilst such an approach gives rise to certain implementation issues, including the important matters raised by you, legislating an effective national law is an integral part of delivering the benefits of this aspect of the national competition policy agenda.

Scrutiny of Legislation

I am advised that it is the practice of Chief Parliamentary Counsel to print application of laws acts with the applied law as an appendix to such acts so that a person wishing to know the law will find the relevant Victorian law in one place. Chief Parliamentary Counsel has confirmed that that practice will be followed upon passage of this Bill so that the Gas Pipelines Access (Victoria) Law (the "Access Law") will be an appendix to the Gas Access Pipelines (Victoria) Act 1998 (the "Act"). In the meantime, copies of the Access Law have been and will continue to be available for the scrutiny of members from me or from my Department.

Regulations

It is inherent in a successful application of laws regime that, in addition to primary legislation, any regulations also be identical across the participating jurisdictions.

Accordingly, section 8 of the Act provides for the application of "lead regulations" in a similar manner to application of the Access Law. Control is through section 10 of the Gas Access Pipelines (South Australia) Act 1997 which provides that a regulation made under that Act may only be made on the unanimous recommendation of the relevant Ministers of the scheme participants.

In order to balance the objective of effecting Victoria's commitments to national competition policy reform under COAG Agreements with the objective of appropriate scrutiny, I invite the Committee to be involved in the processes leading up to the approval of the "lead regulations".

Delegation Provisions

Whilst the interpretative provisions in Schedule 1 of the Access Law regulate the delegation of functions or powers, a delegation may only take effect where it is authorised by the Access Law. In fact, there is no such authorisation.

Section 85 of the Constitution Act 1975

The issue raised here appears to be one of particular application of the matter raised under the first heading. Again, I note that a copy of the Law will be printed as an appendix to the Act and that copies of the Law have been and will continue to be available for the scrutiny of members from me or my Department. In these circumstances, I do not consider that the relevant provisions are beyond scrutiny.

Continuing Problem

Whilst I believe that the Access Law is not beyond scrutiny, I acknowledge that there are no doubt alternative methods for ensuring that applied law is available for perusal and consideration as part of the parliamentary process. The Committee may wish to consider seeking a referral to inquire into those alternatives as part of its work.

Petroleum Bill

The Committee expressed it's concern at the very broad regulation making power sought to be introduced by section 252(2)(f) of the Bill which provided:–

The regulations may provide in a specified case or class of case for the exemption of people or things from any of the provisions of this Act, whether unconditionally or on specified conditions, and either wholly or to such extent as is specified.

The Committee wrote to the Minister expressing concern in the following terms:–

The Committee is concerned at the very broad regulation making power sought to be introduced by clause 252(2)(f) and notes that a similar provision is not contained in the Act to be repealed. The Committee is concerned that notwithstanding the detailed provisions of the Act, specified cases or classes of cases may be exempted from the operation of the Act either in part or in whole either with conditions or unconditionally. The Committee further notes that no explanation is provided in either the Explanatory Memorandum or the Second Reading Speech for the necessity of such a wide regulation making power.

The Committee is of the view that clauses which allow for the amendment of the relevant Act by subordinate legislation, such as a regulation declaring that an Act or a provision of an Act does not apply to, or applies with prescribed changes, are generally objectionable.

The Committee will write to the Minister seeking comment as to why such a broad regulation making power is necessary and why it should not be regarded as a generally objectionable `Henry VIII clause'.*

*(A `Henry VIII clause' is a clause in an Act of Parliament which enables the Act to be expressly or impliedly amended by subordinate legislation or Executive action.)

The Minister's response

The exemption provision is included to account for situations where adherence to the Act or regulations is not practical or the benefit of exemption far exceeds the need to regulate a specific activity. The exemption would be provided for by specific regulation and subject to the Regulatory Impact Statement Process. Provisions of this type are common in Acts requiring full regulatory powers.

In most cases the provision refers to exemption to "regulations" rather than "Act". The reference to Act in the provision rather than regulations arises from the way in which "Act" is defined in clause 5(2) of the Bill where Act is meant to include the associated regulations.

The intention was to provide exemptions where necessary from the regulations by regulation. Technically the provision, as it now stands, could also permit exemptions from the Act. On balance after review of other legislation and discussions with Parliamentary Counsel officers it would be appropriate to replace "Act" with "regulations" at the next opportunity. Regardless I will at this time give you an undertaking not to exempt anyone or anything from provisions of the Act.

Consumer Credit (Finance Brokers) Bill

Similar to the problem perceived with the regulation making powers contained in the Petroleum Bill (above), the Consumer Credit (Finance Brokers) Bill provided in section 37B that:–

The Governor-in-Council may, by Order published in the Government Gazette, declare that this Part, wholly or to the extent specified in the Order, does not apply to – a specified person or to a specified class of person; or a specified transaction or to a specified class of transaction.

The Committee wrote to the Minister in the following terms:–

The Committee is concerned at the very broad declaratory power sought to be introduced by clause 4 and notes that a similar regulation enabling provision is contained in the Act to be repealed (section 3(2) of the Finance Brokers Act 1969). The Committee is concerned that specified cases or classes of cases may be exempted from the operation of the Act either in part or in whole either with conditions or unconditionally. The Committee further notes that no explanation is provided in either the Explanatory Memorandum or the Second Reading Speech for the necessity of such a broad power.

The Committee is of the view that clauses which allow for the amendment of the relevant Act by subordinate legislation, such as a regulation or Government Gazettal of a Governor-in-Council Order declaring that an Act or a provision of an Act does not apply to, or applies with prescribed changes, are generally objectionable.

The Committee believes that such a provision would properly be characterised as a `Henry VIII clause' enabling the Act to be expressly or impliedly amended by subordinate legislation or Executive action.

The Committee therefore seeks your response as to why such a power is desirable or warranted in the circumstances. The Committee would appreciate your response by facsimile at your earliest opportunity.

The Minister's response

I refer in particular to your concerns about proposed section 37B of the Consumer Credit (Victoria) Act 1995. Section 37B would provide for exemptions by Order in Council from proposed Part 4A or specified provisions of that Part. You have stated that the Committee is of the view that clauses which allow for the amendment of the relevant Act by subordinate regulations declaring that an Act or a provision of an Act does not apply to, or applies with prescribed changes, are generally objectionable, and that such a provision would be properly characterised as a "Henry VIII clause" enabling the Act to be expressly or impliedly amended by subordinate legislation or Executive action.

I note that the provision under discussion does not allow for the modification of an Act, as distinct from exemption therefrom. The use of such exemption powers has been common in Victorian and Commonwealth statutes for many years. Indeed the proposed exemption section is relevantly identical with section 10 of the Consumer Credit (Victoria) Act 1995, which provides for exemptions from Part 4 thereof. In turn section 10 is a simplified version of section 19 of the Credit Act 1984, and as you note, proposed section 37B is equivalent to section 3(2) of the Finance Brokers Act 1969.

The policy reasons for permitting exemptions to be done by subordinate regulation include the need for flexibility and rapid response to particular situations. Perhaps more importantly, a power of exemption results in no increased burden on the citizen, but rather the release from an obligation or the lessening of an existing burden. As such the role of Parliament in protecting the citizen from undue obligation has already been discharged.

2.5 General inquiries

The Committee made general inquiries and comment in relation to a number of bills. Some of the issues raised did not fall strictly within the Terms of Reference of the Committee but reflect the Committee's desire to inform Parliament by highlighting an important provision for it's consideration. The Committee is aware that whilst its principal responsibility is to report to Parliament, Alert Digests produced by the Committee have a wider audience and the Committee's comment and dialogue with Ministers on specific issues make for a more informed public and help to encourage best legislative practice. The following bills were the subject of Ministerial clarification or comment by the Committee.

• Transport Accident (Amendment) Bill – Digest No. 3. The Committee wrote to the Minister in relation clause 4 of the bill amending section 23(2)(c) of the Transport Accident Act 1986 by repealing the requirement that the Transport Accident Commission's authorisation of services be in accordance with the regulations. The Minister's response was published in Digest No. 4.
• Conservation, Forests and Lands (Miscellaneous Amendments) Bill – Digest No. 6. The Committee noted that clause 39 inserted a new section 11A in the Coastal Management Act 1995 that made express provision that a member of a Board was not to be taken to hold an office of profit under the Crown preventing a member of the Victorian Parliament to sit as such a member notwithstanding the provisions of the Constitution Act 1975. The Committee also noted that whilst members of Parliament may serve on such Boards they were not to receive any pecuniary benefit from doing so.
• Trade Measurement (Administration)(Amendment) Bill – Digest No. 7. In this instance the Bill's passage through all stages in both Houses of Parliament was so rapid that the Committee was unable to fulfil it's scrutiny role in accordance with the intent of the Parliamentary Committees Act 1968. Whilst the Committee acknowledged the special circumstances in this case why this was so it nonetheless pointed out that the Committee's functions were and are an integral part of Parliamentary scrutiny and recommended that in similar circumstances where urgent Executive action is required that the advice for that course of action be made known to the Parliament in the Second Reading Speech and the Explanatory Memorandum. The Committee also observed that no commencement date was set by the Bill and that therefore the provisions of section 11(1)(b) of the Interpretation of Legislation Act 1984 would take effect and the amendment would commence 28 days after receiving the Royal Assent.
• Local Government (Nillumbik Shire Council) Bill – Digest No. 8. The Committee noted the dismissal of the Nillumbik Shire Council and that the Bill made provision for a general election to be held in the normal course, coinciding with other council elections on 20 March 1999.
• Rail Corporation (Amendment) Bill – Digest No. 4 and the Rail Corporation (Further Amendment) Bill – Digest No. 8. The Committee noted policy reasons for the Corporation not being required to fence or maintain fencing in relation to rail track and the policy not to attach legal liability for failure to fence or maintain fencing in relation to such track.

2.6 Changes to the format and content of the Alert Digest during 1998

During the year the Committee adopted a number of minor changes to the format and content of Alert Digests, they are:–

• provision of a cumulative index of Bills considered by the Committee during the year;
• inclusion of the date the Minister delivered the Second Reading Speech;
• routine comment in respect to a Bill's commencement clause, irrespective of whether the clause presented a problem to the Committee or not;
• a new section in relation to Ministerial Correspondence; and
• clearer highlighting of all comments made by the Committee.

The Committee would be pleased to hear from Members of Parliament and other readers on the subject of Digest content.

2.7 Ministerial responses

As the Committee observed in 1997, and regrettably once again observes in this report, occasionally there seems to be a critical time lag between the date the Committee's letter is sent to a Minister and the date the Minister's response is received. This year the Committee encountered delays in relation to the following Bills:–

• Health Services (Further Amendment) Bill
• Petroleum Bill
• Consumer Credit (Finance Brokers) Bill
• Mutual Recognition (Victoria) Bill

The Committee is aware of the pressures involved in the legislative process particularly during a parliamentary session, however Ministers and their departments need to be mindful that the Committee's jurisdiction in parliamentary scrutiny only commences after a Bill has been second read and it's effectiveness assured if the relevant Minister has considered the Committee's comments and responded to it before the Bill has completed it's passage through both Houses. When the Committee sends a letter to the Minister it generally stipulates that a response is desired via facsimile in time for incorporation in the next relevant Alert Digest, generally before the Bill has concluded passage through Parliament. The effectiveness of the Committee's functions are diminished if a response arrives after the session is over and possible remedial action thereby thwarted The practice adopted in 1997 of presenting the timing and flow of Committee/Ministerial correspondence in tabular form is repeated this year.

2.8 Table of correspondence between the Committee and Ministers during 1998

* Ministerial responses reported in Alert Digest No. 1 of 1999.

Last Updated 18/8/99 ©Parliament of Victoria