Annual Review 2002,
Regulations 2002

Competition Policy Certificates and Assessments

The Regulation Review Subcommittee expects competition policy certificates and competition policy assessments to be in the form contained in the Premier’s Guidelines. The Subcommittee also requires all competition policy assessments and certificates to be forwarded to it.

Part 14 of the Premier’s Guidelines sets out the requirements for competition policy assessments and certificates. A competition policy assessment needs to be done where a regulation imposes a restriction on competition. The assessment needs to show that the benefits of the restriction to the community outweigh the costs and that the objectives of the legislation can only be achieved by restricting competition.

Sometimes the Regulation Review Subcommittee is presented with inadequate competition policy assessments such as those which simply repeat the contents of Regulation Impact Statements. This is not acceptable to the Regulation Review Subcommittee. An assessment of competition policy principles requires a different analysis to that performed for a Regulation Impact Statement and the form of this assessment must be as set out in Attachment B to Part 14 of the Premier’s Guidelines.

The Regulation Review Subcommittee has also been presented with inadequate competition policy certificates which, for example, fail to contain relevant information. The Regulation Review Subcommittee requires certificates to be in the form set out in Attachment C to Part 14 of the Premier’s Guidelines. In order to assist department and agency officers the Subcommittee repeats the required form for competition policy certificates –

Certificate of Compliance – Subordinate Legislation that does not restrict competition

I [Minister’s name], Minister for [portfolio], and Minister responsible for administering the [title of authorising Act for the subordinate legislation] certify that the proposed [title of regulation] –

Has been assessed in accordance with the guidelines and the results documented in the attachment to this certificate, and

The assessment shows that the proposed subordinate legislation does not restrict competition.

DATED:
[Minister]
[Title]

Certificate of Compliance – Subordinate Legislation that restricts competition

I [Minister’s Name], Minister for [portfolio], and Minister responsible for administering the [title of authorising Act for the subordinate legislation] certify that the proposed [title of regulation] –

Has been assessed in accordance with the guidelines and the results of the assessment are documented in the attachment to this certificate, and

Restricts competition; and

Each restriction on competition has been assessed in accordance with the guidelines with the result that –

The objectives of the legislation can only be achieved by restricting competition, and

The benefits of the restriction to the community as a whole outweigh the costs.

DATED:
[Minister]
[Title]

Exemptions and Exceptions

• Dating Certificates. The Regulation Review Subcommittee has been presented with a number of undated exemption and exception certificates. The Premier’s Guidelines make clear that all certificates including certificates of exemption and exception must be dated by the Minister at the time of signing. See sample certificates attached to the Premier’s Guidelines. The Regulation Review Subcommittee continues to expect all certificates to be dated.

• Reasons for Exemption. The Regulation Review Subcommittee has received regulations exempted under section 9 with certificates of exemption which fail to adequately explain the reasons for granting the exemption or with reasons for granting the exemption contained in the Explanatory Memorandum. It should be noted that it is a requirement of section 9(2) of the Subordinate Legislation Act 1994 (Vic) that certificates of exemption ‘specify the reasons for the exemption’. The Regulation Review Subcommittee expects all exemption certificates to contain adequate explanations of the reasons for granting the exemptions.

• Extension of Regulations for Periods up to 12 months. Regulations expire 10 years after they have been made. The Regulation Review Subcommittee has been presented with a number of regulations made under sections 8(1)(iii) and 5(3) extending regulations due to expire for periods up to 12 months. Before an extension of time can be granted, the Minister must certify that due to ‘special circumstances’ there is insufficient time available to comply with the formal regulation-making requirements of the Subordinate Legislation Act 1994. The Premier’s Guidelines indicate that ‘special circumstances’ include cases where a review of the whole area is underway but incomplete or where national scheme legislation is being negotiated. ‘Special circumstances’ do not include administrative oversight and the Regulation Review Subcommittee will not approve regulations made for these reasons. The Regulation Review Subcommittee expects details of the ‘special circumstances’ to be contained in the section 5(3) certificate itself as required by the Subordinate Legislation Act 1994. The Subcommittee remains concerned about whether the review processes referred to are actually carried out and will continue to monitor regulations made under this exception very carefully.

• Appreciable Economic and Social Burden and Consultation. Section 9(1)(a) exempts regulations from the Regulation Impact Statement process where no appreciable economic or social burden is imposed. There has been confusion as to the level of consultation required and over the need to provide certificates of consultation to the Regulation Review Subcommittee. Some departments and agencies do not provide certificates of consultation for regulations made under this exemption. It is the opinion of the Regulation Review Subcommittee that paragraphs 5.30 and 5.31 of the Premier’s Guidelines indicate that consultation should take place to determine whether or not a regulation imposes an appreciable economic or social burden and that the Subcommittee should be provided with a certificate of consultation. Legal opinion from the Department of Premier and Cabinet indicates that the Regulation Review Subcommittee’s interpretation of the Premier’s Guidelines is valid. The Regulation Review Subcommittee continues to prefer consultation to be undertaken to determine whether a regulation imposes an appreciable economic or social burden and to receive certificates of consultation evidencing that consultation.

• Using Appropriate Exemption and Exception Categories. Department and agency officers need to be careful when determining which category to use when exempting and excepting regulations from the Regulation Impact Statement process. The Regulation Review Subcommittee has received regulations exempted and excepted incorrectly.

• Typographical Errors. Department and agency officers need to be careful when preparing certificates to ensure that they do not contain typographical errors.

Explanatory Memoranda

The Regulation Review Subcommittee expects an Explanatory Memorandum to comply with the requirements contained in the Premier's Guidelines. An Explanatory Memorandum must contain –

• A brief outline of each provision.

• An explanation of the changes brought about by each provision.

• A statement of the reasons for making the regulation.

• A statement as to whether consultation has taken place and if no consultation has taken place a statement as to why a decision was made not to consult.

• A statement as to the reasons for not making a Regulation Impact Statement where none was prepared.

It is a requirement that all Explanatory Memoranda be forwarded to the Scrutiny of Acts and Regulations Committee.

Fee Increases: 8(1)(a) and 8(2)

Regulations increasing fees made under section 8(1)(a) of the Subordinate Legislation Act 1994 (Vic) must not increase fees by more than the percentage set by the Treasurer. For each financial year a percentage increase is set by the Treasurer in a document entitled Guidelines for Setting Fees and Charges Imposed by Departments and Budget Sector Agencies. The rate for the budget year 2003-2004 is 3.0%.

A regulation may increase a number of fees, with some individual fee increases falling outside the rate set by the Treasurer. However when the total average of fee increases for that regulation is calculated, it falls within the rate fixed by the Treasurer. This practice is referred to as the ‘basket approach’. The Regulation Review Subcommittee does not support this practice. In the Report on the Subordinate Legislation Act 1994 the Committee recommended that the basket approach be prohibited. This recommendation has been accepted by the Government.

Section 8(2) of the Subordinate Legislation Act 1994 (Vic) validates the rounding up of fee increases to the nearest whole dollar. Sometimes the total average increase may be greater than that set by the Treasurer but may be validated on the basis that there has been rounding up to the nearest whole dollar. The Regulation Review Subcommittee may only approve such increases where the extra amount can be considered trifling when compared to the whole fee. Where the amount is significant in proportion to the whole fee, the Regulation Review Subcommittee may request the Minister to reconsider the increase.

In the Report on the Subordinate Legislation Act 1994 the Committee recommended that departments and agencies be required to prepare a table showing new and old fees and including an indication of the percentage increase or decrease and that a copy of this be provided to the Regulation Review Subcommittee. This recommendation has been accepted by the Government. The Regulation Review Subcommittee provides the following as an example:

This assists the Regulation Review Subcommittee in understanding the fee increases which have taken place.

Independent Advice Certificates: 10(3)

Under section 10(3) of the Subordinate Legislation Act 1994 (Vic) a Minister must ensure that independent advice as to the adequacy of a Regulation Impact Statement and of the assessment included in the Regulation Impact Statement is obtained. In the Report on the Subordinate Legislation Act 1994 the Committee recommended that the Regulation Review Subcommittee be provided with independent advice certificates. This recommendation has been accepted by the Government. The Regulation Review is very pleased about this because it will assist it in its assessment of whether there has been compliance with the requirements of the Subordinate Legislation Act 1994.

Legislative Instruments outside the Subordinate Legislation Act 1994

The Regulation Review Subcommittee plays a vital role in ensuring that rights are adequately protected. It cannot do this if provisions are incorporated in legislative instruments outside its scrutiny. The Regulation Review Subcommittee prefers department and agency officers not to use Guidelines and Codes of Practice. Where Guidelines and Codes of Practice are used the Regulation Review Subcommittee would like those Guidelines and Codes of Practice to be published and available to the public at the same time as the regulation commences operation.

Provision of Documentation to Regulation Review Subcommittee

The Regulation Review Subcommittee needs to receive Explanatory Memoranda, all certificates, competition policy assessments and certificates, Regulation Impact Statements and comments and submissions made in relation to Regulation Impact Statements within 7 days after a regulation has been made. The Regulation Review Subcommittee has a limited time within which to review regulations. If the Committee wants to move for disallowance of a regulation it must do so within 18 sitting days of that regulation being tabled in Parliament. Prior to the Committee moving a motion for disallowance the Regulation Review Subcommittee corresponds and negotiates with the particular Minister. The Regulation Review Subcommittee needs sufficient time for this process to take place.

In the Report on the Subordinate Legislation Act 1994 the Committee recommended that all paperwork be provided to the Regulation Review Subcommittee within 7 days after a regulation has been made. This recommendation has been accepted by the Government. The Regulation Review Subcommittee therefore expects to receive all paperwork promptly. Part 14 of the Notes for the Guidance of Legislation Officers issued by the Office of the Chief Parliamentary Counsel Victoria, on 1 March 1999 provides details of the paperwork which should be received by the Subcommittee –

Within 7 days after a statutory rule is made, the Department or Board, Committee or body responsible for the rule must send to the Secretary of the Scrutiny of Acts and Regulations Committee –

7 copies of the explanatory memoranda as required to be sent to the Clerk of the Executive Council; and

a copy of the section 13 certificate of the Chief Parliamentary Counsel under section 13 of the Act; and

if the guidelines require consultation, a certificate under section 6(c) of the Act certifying that there has been consultation in accordance with the guidelines; and

if a regulatory impact statement was prepared, a copy of the compliance certificate, copies of all comments and submissions received in connection with it, and the response of the Department, Board, Committee or body to those comments and submissions; and

if a regulatory impact statement was not required, a copy of the exception certificate under section 8 or the exemption certificate under section 9.

Recommendations

The Regulation Review Subcommittee notes that some regulations are made on the recommendation of a Minister or some other authorised body. If the Regulation Review Subcommittee is provided with a copy of the recommendation, it can certify that the regulations have been validly made in accordance with that recommendation. Where the Regulation Review Subcommittee is not provided with a copy of that recommendation, it cannot certify that the regulations have been validly made. The Regulation Review Subcommittee would appreciate receiving copies of all recommendations.