Annual Review 2002,
Regulations 2002

Appendix 4 - Government Response to Report on the Subordinate Legislation Act 1994

The Government notes and acknowledges that the Scrutiny of Acts and Regulations Committee (the Committee) recognises, in the Executive Summary to its Report on the ‘Inquiry into the Subordinate Legislation Act 1994’, that Victoria has a reputation for leading the way with regulation reform and its regulatory system.

The Committee has made a large number of recommendations, 55 in all, which if accepted would result in considerable change in the process by which subordinate legislation is made subject to public scrutiny. Given the fact, and Victoria’s excellent record in this area, these recommendations need to be considered carefully.

In the course of its deliberation, the Committee received a large number of submissions and undertook study of various other jurisdictions. Upon the Report’s release, but following the 2002 election, consultation was undertaken with Departments and Agencies, including Office of the Chief Parliamentary Counsel and the Office of Regulation Reform, as the recommendations have important resource implications.

Following the consultation, the Government has responded to each recommendation as described in the table set out below. Overall the Government:

Supports fully recommendations 2, 5, 6, 7, 9, 10, 11, 12, 13, 14, 19, 21, 22, 23, 28, 30, 32, 35, 37, 43, 46, 47, 49, 50, 51, 55;
Supports in part recommendations 4, 8, 24, 29, 38, 39, 40, 41, 42, 44, 45, 52, 53, 54; and
Does not support recommendations 1, 3, 15, 16, 17, 18, 20, 25, 26, 27, 31, 33, 34, 36, 48.

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Several of the key recommendations, which would have the largest impact on the system, are discussed more broadly below.

Instruments of Legislative Character

Recommendation 1 proposes that the Subordinate Legislation Act 1994 (the Act) be extended to apply to instruments of a legislative character as defined in the Legislative Instruments Bill 1996 (Cth).

This is a key recommendation as a number of other recommendations are based on acceptance of this initial recommendation.

The definition of ‘legislative instrument’ as described in the Commonwealth Bill is considerably wider in scope than the range of instruments covered under the Act. Such a definition would encompass instruments such as ministerial directions, orders in council, determinations etc. and would lead to a corresponding increase in the number of Regulatory Impact Statements (RIS) required.

The Office of Regulation Reform (ORR) notes that Recommendation 1 has clear implications on the extent to which subordinate instruments are subject to the RIS approach (ie. require a Regulatory Impact Statement to be prepared). The findings of the Committee’s Inquiry and ORR’s practical experience suggests that there are many instruments (eg Ministerial Orders) that impose a burden on the community that are not the subject of a RIS or similar process. ORR acknowledges that there are some instruments, not subject to the RIS process, that do undergo RIS type scrutiny such as those under the Planing and Environment Act 1987 and the Local Government Act 1989.

The Office of Chief Parliamentary Counsel (OCPC) noted that it supports extending the scope of the Act as proposed by Recommendation 1 if there were certainty in determining the range and types of instruments that are of legislative character. OCPC also noted the enormous resource implications of implementing Recommendation 1 and the existence of other mechanisms presently existing. For example, section 4(1)(a) of the Act allows any instrument to be prescribed as a statutory rule and hence be subject to the Act.

On balance therefore, the Government does not support Recommendation 1 for the following reasons:

It is a matter for Parliament to determine the mechanism for scrutiny of different forms of legislative instruments;
There would be an enormous impact on resources and workload given the wide definition of “legislative instrument” in the Commonwealth Bill;
Uncertainty about the range and types of legislative instruments to which the Act would consequently apply; and
There are existing avenues to bring a particular legislative instrument within the scope of the Act by deeming or prescribing it a statutory rule for the purposes of the Act (s4(1)(a)).

This recommendation is also discussed on page 67.

Inclusion of an “environmental” burden assessment

Recommendation 8(b) proposes that consideration be given to expanding the threshold test to include “environmental” burden assessment in determining whether a Regulatory Impact Statement should be prepared.

The Government does not support the expansion of the test, currently requiring an assessment as to ‘social’ or ‘economic’ burden, to also include an assessment as to ‘environmental’ burden. This is because any burden on the environment is likely to be identified in the economic impact discussion or social impact discussion. Furthermore, in cases involving public works, which include works undertaken by or on behalf of the Crown or for public statutory the Environmental Effects Act 1978 requires an Environmental Effects Statement to be prepared before commencing any public works, which include works undertaken by or on behalf of the Crown or for public statutory bodies.

This recommendation and Recommendation 38, raising similar issues, are also discussed on pages 68 and 74 to 75.

Assessment of Regulatory Performance

Recommendations 18 and 40 propose that there be an enhanced assessment of how departments and agencies comply with regulatory performance indicators. There currently exists a number of mechanisms to assess performance of Departments/Agencies including corporate plans, annuals reports, financial indicators and audit requirements. The Government views these mechanisms as useful in assessing compliance. The Government does not support these recommendations at this time and is of the view that this is a matter for broader government policy consideration, in the future.

Court Fees and Costs

Recommendation 24 proposes that regulations increasing court and tribunal fees comply with the rate fixed by the Treasurer or be required to prepare Regulatory Impact Statements (RISs).

The Government notes that the Committee expresses "serious concern" about the frequency of increases in court fees and their effect on access to justice. The Government does not believe that this concern is soundly based. For example, the County Court exercises an unlimited jurisdiction with respect to personal injuries and a $200,000 jurisdiction in other civil matters. Despite the potential size of claims, the filing fee for originating process has increased by a maximum total of $59 between 1996 and the present day, an average of less than $10 per year. In 2001, fees in the County Court were restructured to enable parity with fees in the Supreme Court and to ensure that fees more closely reflected the particular activities within a case. This enabled a reduction in the fee for originating process from $429 to $420.

More significantly, the Committee maintains that fee increases are made under section 8(1)(b) of the Subordinate Legislation Act, which exempts the fees from the RIS process. According to the Committee, this means that the Regulation Review Sub-Committee "remains powerless" to comment on the amount of the fee increases. The Department of Justice, in consultation with the relevant court/s, however, regularly prepares RISs with respect to increases in court fees, and complies with the processes contained in Act. Copies of the RIS, submissions, and Government response to the submissions regarding the 2001 fees regulations were forwarded to the Committee under cover of a letter, from the Department of Justice, dated 14 February 2002. Accordingly, the Government believes that the process for increasing court fees already contains elements of transparency and is subject to scrutiny.

The Committee’s recommendation seems to have misconstrued the provisions in section 8 of the Act. Section 8(1)(a) deals with court fees (eg. Bailiff’s fees), whilst section 8(1)(b) deals with court procedures, practice and costs (eg. scale of costs such as the maximum chargeable for a conference with counsel). In the Report, the Committee seems to have blurred this distinction. Under the Act, court and tribunal fees must comply with the rate fixed by the Treasurer. Where court fees do not comply with the amount approved by the Treasurer, a RIS must be prepared. On the other hand, if a statutory rule deals with practice, procedure and the scale of costs, of a court or tribunal, these regulations are not required to be subject of a RIS. The Department of Premier and Cabinet and the Department of Justice are of the view that this distinction has been made in the Act to ensure that the Court is responsible for developing its own procedures, practice and scale of costs as appropriate in the interests of maintaining independence from the Executive.

Accordingly, the Government supports Recommendation 24(a), noting that regulations increasing court and tribunal fees are already required to comply, and do comply, with the rate fixed by the Treasurer for regulations made under section 8(1)(a). The Government does not support Recommendation 24(b); preferring to ensure the independence of the courts in developing their own scale of costs, procedures and practices. This recommendation is also discussed at page 71 of the table following.

The following table outlines the Government’s Response to each of the Committee’s recommendations: