Thursday, 16 September 2021

Bills

Water and Catchment Legislation Amendment Bill 2021

Statement of compatibility

Mr WYNNE (Richmond—Minister for Planning, Minister for Housing) (15:21): It has been a hectic day for me. In accordance with the Charter of Human Rights and Responsibilities Act 2006 I table a statement of compatibility in relation to the Water and Catchment Legislation Amendment Bill 2021.

In accordance with section 28 of the Charter of Human Rights and Responsibilities Act 2006 (the Charter), I make this statement of compatibility with respect to the Water and Catchment Legislation Amendment Bill 2021 (the Bill).

In my opinion, the Bill, as introduced to the Legislative Assembly, is compatible with the human rights as set out in the Charter. I base my opinion on the reasons outlined in this statement.

Overview of the Bill

The Bill amends the Water Act 1989 (Act) to provide for recording certain information under the Act, the regulation of the places, rates and times at which water can be taken and to provide a new Ministerial power to deal with instances where a person takes water in excess of the person’s authorised amount of water. The Bill makes various other amendments to the Act and the Catchment and Land Protection Act 1994 (Catchment Act).

Human rights issues

The amendments made by the Bill engage the Charter rights to privacy (s 13(a)), property (s 20) and to the presumption of innocence (s 25(1)).

Right to privacy

Section 13(a) of the Charter provides that a person has the right not to have their privacy, family, home or correspondence unlawfully or arbitrarily interfered with. An interference with privacy will be lawful if it is permitted by a law which is precise and appropriately circumscribed and will not be arbitrary provided it is reasonable in the circumstances and just and appropriate to the end sought.

The Register—names and or addresses

Part 5A of the Act provides for there to be a water Register (Register), where records and information about water-related rights, entitlements, licences and approvals (statutory approvals), and the name and address of who holds statutory approvals, are recorded. The Register also enables the monitoring of, and reporting in relation to, water resource use and the water market. One of the Minister’s functions is to create, or enable the creation of, reports derived from information on the Register, which may be made available to the public subject to certain restrictions.

The name and address of each person holding a statutory approval is required to be recorded in the Register for several reasons. The statutory approvals can be exchanged between people in the water market, subject to the Minister’s approval of each transaction in accordance with certain statutory criteria. The record in the Register is evidence of each person’s right to transfer or assign the statutory approval to another person. Water shares can be mortgaged and the interests of the parties to a mortgage are protected by recording their name and address against their interest in the Register. Enforcement of each person’s compliance with the conditions and other limits on any statutory approval they hold also requires there be record of the name and address of every person who holds each approval.

Part 2 of the Bill amends section 84EA of the Act to allow published reports to include the names of individuals, but not their addresses. The Bill also amends section 84VA of the Act to require that, for water licences temporarily transferred under s 62, the name and address of the person to whom the licence has been transferred must be recorded in the Register. The Bill inserts a new section 84VB to require that, for general place of take approvals and particular place of take approvals (discussed below), the Register records the name and addresses of the approval holder, amongst other information about the approval. The Bill also inserts a new section 84VC to require the recording in the Register of the name and address of persons holding an approved interstate rights and assigned water allocations. Further, the Bill will amend section 84W to broaden the types of records and information in the Register that are publicly available by search, to include all records and information in the Register, except for information that is suppressed by a decision under section 84Y or 84Z or prescribed in regulations made under section 84W. Finally, the Bill will broaden the types of statutory approvals in relation to which the name and address of the holder will be recorded, and allow a report of the Minister to include the names of persons holding statutory approvals.

By requiring the collection of individuals’ names and addresses for the additional types of statutory approvals and permitting the publication of persons’ names recorded in the Register and in reports, the Bill will interfere with the Charter right to privacy. However, any interference will be precise and appropriately circumscribed. The collection of persons’ names is necessary to support a market comprised of exchanges in statutory approvals between people, to protect the interests of each person holding a statutory approval and to enforce compliance with water laws. The Act allows for individuals to apply to a recording body under section 84Y, or subsequently to VCAT under section 84Z, to have personal information about the individual suppressed in certain circumstances. Further, I note that regulations will be made under section 84W which will provide additional safeguards against arbitrary interference with privacy in relation to the collection and publication of information under these provisions.

The Bill allows a report of the Minister to include the names of statutory approval holders in order to increase the public transparency of, and knowledge about, the water market and the most active traders in the market. This will be similar to the published information about water markets in other States and the Australian Stock Exchange and the public availability, by search, of the names and addresses of persons with an interest in land recorded in the Land Register. Under the amendments made by the Bill, the current prohibition on the publication of individuals’ addresses in reports by the Minister will be retained. The limitations under section 84EA on what can be included in a public report will be expanded to ensure any information that is the subject of a suppression decision under section 84Y or 84Z, or prescribed under section 84W to not be publicly available, cannot be included in a report.

Any interference with privacy by these amendments will therefore be lawful and not arbitrary. In my view, the right to privacy will not be limited by the amendments made by the Bill, and I therefore consider that the Bill will be compatible with the Charter right.

Right to property

Section 20 provides that a person must not be deprived of their property other than in accordance with law. Any power which authorises the deprivation of property must be conferred by a law, confined and structured, formulated precisely, and accessible to the public to allow people to regulate their own conduct.

Ministerial power to give and cancel place of take approvals

Part 3 of the Bill will insert a new Part 4AA into the Act, to regulate the place, rates and times at which water can be taken from a declared water system. It will provide that the Minister may give approvals of the places at which persons can take relevant water allocations (‘general place of take approval’) (new section 64FC); and to persons to take their relevant water allocations from their approved place (‘particular place of take approval’) (new section 64FZJ). Such approvals may be subject to terms and conditions, including a notional rationing rate of taking water and maximum rates of taking water. The Bill provides that the Minister may, on the Minister’s own motion, cancel a general place of take approval in circumstances to be set out in the Act (new section 64FS). These circumstances include if the Minister reasonably believes that the approval holder has not taken water from the approved place for 10 years, or a lesser prescribed period, or if the grounds on which a person may apply for a general place of take approval no longer exist. The Bill will also provide that a general place of take approval will automatically cease to exist if the grounds on which a person may apply for a general place of take approval no longer exist and there is no notional rationing rate fixed to the approval or the rate is zero (new section 64FE).

The Minister’s powers to refuse applications for place of take approvals may be seen to interfere with property rights, by limiting a person’s authorisation to take water from certain places. However, in my view, refusal decisions do not result in a deprivation of property, as any property rights are only enlivened upon the giving of an approval. Further, even if the decision does result in a deprivation of property, any such deprivation is lawful as the giving of approvals is governed by a clear and accessible process set out under legislation. The Bill will insert new section 64FZM to provide that a person affected by specified decisions of the Minister under new Part 4AA of the Act may apply to the Victorian Civil and Administrative Tribunal (VCAT) for review of the decision.

In relation to cancellation decisions and any automatic cancellation of a general place of take approvals, insofar as existing approvals could be characterised as ‘property’ under the Charter, cancelling approvals may constitute a deprivation of property. However, the Minister may only cancel general place of take approvals in very narrow circumstances—when the Minister believes the approval has not been used in over 10 years (or lesser prescribed period) or the grounds on which a person may apply for a general place of take approval no longer exist. The automatic cancellation of a general place of take approval may also only occur in very narrow circumstances: when the grounds on which a person may apply fora general place of take approval no longer exist and there is no notional rationing rate greater than zero fixed to the approval. Cancellation decisions by the Minister will also be subject to VCAT review. I therefore consider that any deprivation of property that occurs as a result of decisions to refuse approval applications, or to cancel approvals, is lawful, and the Charter right to property will not be limited by relevant amendments made by the Bill.

Powers of Minister where water taken exceeds statutory approvals for amount of water that can be taken from an approved place

Part 4 of the Bill amends the Act to provide powers to the Minister to deduct from a person’s current and future rights to take water in certain circumstances where the Minister reasonably believes the person took water in excess of the authorised amount of water they are approved to take from the person’s approved place.

With regard to future rights to take water, the right to property will not be engaged because no interest in property will have crystallised at the time of the Minister’s decision. The Bill inserts new sections 64B(3) and 64D(3) into the Act to provide that a right to take water referred to in these sections is subject to the Minister’s power to determine deductions.

The powers of the Minister to deduct an amount of water from a person’s entitlement to take water will engage the right to property to the extent that they apply to existing rights to take water. In my view, the right will not be limited. The Minister’s decisions will be governed by a clear and accessible process set out under the legislation.

Where the Minister deducts water that a person may take from a different approved place or different licensed place (but in the same water system) to which the person took an unauthorised amount (new sections 64B(2)(b) an 64D(2)(b)), the Bill requires the Minister to give a written notice of each deduction determination to the person to whom the determination applies (new section 64EB).

Where the Minister deducts water that a person may take from the same approved place or same licensed place at which the person took an unauthorised amount (new sections 64B(2)(a) and 64D(2)(a)), the Bill does not require the Minister to give notice of each deduction determination to the person to whom it applies. Instead of a notice requirement in these circumstances, the Bill will insert new sections 64C and 64E to oblige a person proposing to take water from their approved place or licensed place to first find out from their Register account records (and other sources of information) the authorised amount of water they are approved to take from that place. The purposes of these two provisions include placing an obligation on persons taking water under these types of water rights to find out: how much of their authorisation remains available to take; and whether the Minister has deducted an amount of water in the stead of water the person has already taken in excess of their previously authorised amount. A person can view information in the Register at any time on how much water has been recorded as taken at their approved place or licensed place of take, and therefore deducted from their account, and they also receive an account statement at the end of each 12 month water season. Although this new requirement is expressed as an obligation, there is no penalty for a person if they do not find out the amount of water they are authorised to take before they start taking water.

Persons affected by a deduction determination of the Minister may request a statement of reasons for the determination, and apply for VCAT review of a deduction determination: within 35 days of receiving notice or reasons being given; or, if a person has not received a notice, within 35 days after the end of the water season in which the determination was made (new section 64EE).

As any deprivation of water rights associated with these provisions will be lawful, under a precise, confined and accessible legislation, I therefore consider that the powers are compatible with the right not to be unlawfully deprived of property.

Restriction and prohibition determinations power

The Bill amends the Act to enable the Minister to issue a restriction determination or a prohibition determination to apply to persons holding a general place of take approval to restrict the rate of taking water, or prohibit the taking of water, in specific circumstances. The Minister may make a determination restricting the holder of a general place of take approval in a rationing area from taking water (‘restriction determination’) during a specified period of time or in specified circumstances (new sections 64FZC and 64FZD). The Minister may also make a ‘prohibition determination’, which prohibits holders of general place of take approvals in areas specified in the determination from taking water during a specified period of time or in specified circumstances (new sections 64FZE and 64FZF). Breach of a determination is an offence (new section 64FZB).

The right to property is engaged by these new powers to make determinations, which may limit persons from exercising rights to take water under their relevant water allocations and therefore constitute a deprivation of property. However, the Minister’s powers to make these types of determinations are only available in certain circumstances and the making of any determination will be governed by a clear and accessible process. Restriction determinations may only be made in respect of rationing areas (being declared areas in a declared water system, which may include irrigation districts; refer to new sections 6C and 64FV) and may only limit the rate at which persons can take water during a specified period of time or in specified circumstances.

A restriction determination must not be made unless the Minister reasonably believes: that the amount of water that can be delivered to a rationing area on a daily basis or throughout the water season is not enough, or soon will not be enough, to meet all or any of the following: the demand to take water from the rationing area, the commitments to deliver water downstream of the rationing area; and any water system management requirements; or that other circumstances prescribed in regulations exist (new section 64FZD). A prohibition determination must not be made unless the Minister reasonably believes that prescribed circumstances exist (new section 64FZF). Determinations must be published on the websites of the Department and relevant Authority, and in the Government Gazette. This ensures that determinations will be sufficiently clear and accessible to enable persons to regulate their own conduct. Therefore, any interference with property rights occasioned by determinations will be lawful, and the right to property will not be limited by the amendments.

I therefore consider that the amendments made by the Bill will be compatible with the Charter right to property.

Right to the presumption of innocence

Section 25(1) of the Charter provides that a person charged with a criminal offence has the right to be presumed innocent until proved guilty according to law. The right is relevant where a statutory provision shifts the burden of proof onto an accused in a criminal proceeding, so that the accused is required to prove matters to establish, or raise evidence to suggest, that they are not guilty of an offence.

Criminal liability of officers for certain offences of a body corporate

Division 4 of Part 4 of the Bill will replace current section 297 of the Act and insert new section 297A into the Act, which will each provide that an officer of a body corporate may be prosecuted for the body corporate’s breach of certain provisions. The Bill will extend the application of the ‘reverse onus’ elements in sections 33EA, 63A, 288A and 289A of the Act, which were discussed in the Statement of Compatibility to the Water and Catchment Legislation Amendment Bill 2019. The effect of new section 297A is that persons who are officers of body corporates that breach one of the offences under sections 33E, 63 or 289 may be prosecuted personally if the officer failed to exercise due diligence to prevent the commission of the offence by the body corporate. Section 297A, which will apply to the offences of misappropriation of water under sections 33E, 63 and 289,does not require proof of a failure to exercise due diligence for the offence to apply, unless the officer presents or points to evidence that suggests a reasonable possibility that the officer exercised due diligence to prevent the commission of the offence by the body corporate.

Under both sections 297 and 297A, defences that would be available to the body corporate if it were charged with the offence will be available to the officer.

Proceedings against officers under section 297A may engage the right to the presumption of innocence under s 25(1). However, the right will not be limited by the amendments. The amendments only restate the existing provision (section 297) that officers of bodies corporate may be prosecuted under relevant offence provisions. The reverse onus offences themselves (discussed in the Statement of Compatibility to the Water and Catchment Legislation Amendment Bill 2019) are not altered by the Bill. Relevantly, the presumptions are limited in scope and only impose an evidentiary burden on the accused—that is, once an accused provides some evidence of due diligence, the onus of proof will shift back to the prosecution to prove otherwise. I therefore consider that the amendments do not limit the right to be presumed innocent, and that new section 297A is compatible with the Charter.

For the reasons set out in this Statement, in my opinion, the Bill is compatible with the human rights as set out in the Charter.

Hon Lisa Neville MP

Minister for Water

Second reading

Mr WYNNE (Richmond—Minister for Planning, Minister for Housing) (15:22): I move:

That this bill be now read a second time.

I ask that my second-reading speech be incorporated into Hansard.

Incorporated speech as follows:

The efficient operation of Victoria’s water and catchments sector is key to ensuring reliable, sustainable and affordable water supply for all Victorians.

The Water and Catchment Legislation Amendment Bill 2021 will give effect to committed Government reforms to the water and catchments sector in nine discrete areas:

• Meeting community calls for greater water market transparency by increasing transparency to the public about the ownership and trade of water;

• Strengthening powers to regulate the place, rate and time of taking water. This allows for better management of the system which delivers water to water users, including managing physical, environmental and operational constraints. This includes empowering water users to manage their own delivery risks by providing clear and tradeable delivery rights and improving powers to manage delivery shortfalls;

• Reflect the integration of Western Water Corporation into City West Water Corporation, to sustainably service the fast-growing western region and rename the new corporation, Greater Western Water Corporation;

• Transferring the functions, powers, duties and employees of Port Phillip and Westernport Catchment Management Authority to Melbourne Water Corporation;

• Ceasing the Victorian Catchment Management Council, transferring some functions to catchment management authorities, and providing a mechanism to establish advisory committees for targeted, time bound, place-based catchment management advice;

• Broaden the primary producer requirements for CMA Boards. This will allow persons whose principal occupation is providing advice and engaging in research about primary production to be included in meeting the requirement that at least half CMA board members are people whose principal occupation is primary production.

• Streamlining reporting requirements for Catchment Management Authorities by removing the requirement that a Conditions Report be prepared and submitted before a prescribed date—which would allow the inclusion of the Conditions Report in CMA annual reports to meet this requirement—rather than duplicating with a separate Conditions Report.

Water Market Transparency

The Government heard community feedback in 2019 and 2020 which called for more publicly available information about ownership and trade of water to improve confidence that markets are working as they should.

This Bill gives effect to the Government’s commitments to increased water market transparency by enabling the publication of individual’s names in water market reporting and greater scope to publicly search the Victorian Water Register. For example, this means the Minister could publish the owners of large amounts of water shares, such as those owning over 2 per cent in a system, for both companies and individuals. This increase in transparency of information will improve confidence in water markets.

Information will be published in accordance with relevant privacy legislation and obligations. Regulations will be made to ensure that particular information is not published or searchable in line with community expectations including keeping water allocation accounts and balances private.

Regulating the Place, Rate and Time of Taking Water

The River Murray System has seen significant changes over the past 10–20 years in both supply and demand for water. Changes within the system and changing demand are making it increasingly difficult to move water to where and when it’s needed for irrigation and the environment, which can lead to a shortfall in delivery.

Shortfalls occur when river operators aren’t able to deliver water to water users—including to irrigators and the environment—where and when they want to use it. This may occur for example when there is increased daily demand during a heatwave and the long distance from the dams means water can’t be delivered in time. With climate change expected to increase the frequency of hot days and the duration of warm spells, such peaks in daily demand are likely to continue to increase.

Although such shortfalls in the Murray have been rare, the risk of shortfall occurring is real and increasing. The changes in this Bill will provide a stronger framework for managing these water delivery challenges.

Existing delivery rights in a shortfall are overly complex under the current legislation. Improvements are needed to give water users more certainty about their rights and enable them to manage their own delivery risks.

The Bill will address this by streamlining the existing overly complex provisions that relate to where water is taken from a declared water system. The new arrangements will provide simplified and consolidated approvals under the Act, referred to as ‘Place of Take’ approvals.

To make sure no one takes more than their fair share during a shortfall, the Bill empowers the Minister to issue a determination to implement rosters and restrictions based on ‘notional rationing rates’ contained in the new ‘Place of Take’ approvals. Rationing rates will reflect the existing extraction share conditions (in current works licences). This new power will enable the Minister to respond quickly when a shortfall event arises and as it unfolds—thereby minimising the impact of a shortfall.

To better enable water users to manage their own delivery risks, the Minister will be able to use rules to cap rationing rates where needed and allow users to trade rationing rates within a declared area.

The Bill links these new arrangements to a tiered system of offences for non-compliance, consistent with the current scheme of significant offences in the Act. This will provide for a strong deterrent and enable compliance and enforcement provisions to be effective and consistent. For the two most serious levels of offence, committing an offence knowingly or recklessly, it is not necessary to prove that the person committing the offence knew or was reckless as to whether their actions would result in serious damage or substantial economic loss, just that they knowingly or recklessly committed the relevant offence.

The Bill will also make clear that each person bears their own responsibility to be aware of how much water they are approved to take from a place, before taking any water. If a person takes more than they are approved to take from a particular place, the Minister can deduct the unauthorised amount from that person’s current and future rights to take water from that place. The Minister will also be able to deduct the unauthorised amount from water that the person is authorised to take at another place in the same system, after providing notice to the person.

The Bill will also implement COAG agreements to provide a nationally consistent and principles-based approach to personal liability of corporate directors for corporate offences.

The Act already provides that officers of body corporates may be prosecuted under relevant offence provisions - these amendments will mean that for the new offences of taking water without a particular place of approval and other more serious water theft offences, directors of companies will now need to prove to the court that they exercised due diligence or receive an individual penalty. This switches the burden of proof to company directors and increases their personal liability.

Targeted Structural Reform of Victoria’s Water Sector to Create Cost Efficiencies

The Bill implements reform of the water sector to ensure sustainability, financial viability, customer affordability and the efficient delivery of services and Government priorities.

The Bill will amend the Water Act 1989, Water Industry Act 1994 Act and Catchment and Land Protection Act 1994 to:

• reflect the integration of Western Water Corporation into City West Water Corporation to form a larger and more efficient water corporation to service Melbourne’s western growth areas, with the entity to be renamed Greater Western Water; and

• integrate Port Phillip and Westernport Catchment Management Authority into Melbourne Water Corporation to enable the sustainable delivery of key catchment management functions for the Port Phillip and Westernport Region.

Serviced Properties Technical Amendments

The Bill will address a technical, transitional issue for the definition of “serviced property”, affecting a small class of properties under the Water and Catchment Legislation Amendment Act 2019. The amended definition of “serviced property” and a transitional provision will include the omitted group of properties on the outskirts of the suburban districts serviced by the three Melbourne retailers.

The amendment is backdated to the date on which the definition of “serviced property” under the Water and Catchments Legislation Amendment Act 2019 came into effect, which was 19 March 2020.

The retrospective nature of this amendment will have no detrimental impact on landowners or water corporation customers as it maintains existing arrangements.

Cessation of the Victorian Catchment Management Council

Whilst the Victorian Catchment Management Council has been at the forefront of integrated catchment management advice over the past two decades, a new model of catchment management leadership and advice is required now that the sector has matured.

The Bill will allow for the creation of new targeted, time bound, place-based committees to provide catchment management advice, building on the foundational work undertaken by the Victorian Catchment Management Council, and transfer functions for encouraging cooperation in and promoting community awareness of catchment management to Victoria’s catchment management authorities.

Broadening of Primary Production Requirement for Catchment Management Authority Boards

The Bill broadens the primary producer requirements for CMA Boards. This will allow persons whose principal occupation is providing advice and engaging in research about primary production to be included in meeting the requirement that at least half CMA board members are people whose principal occupation is primary production.

Annual Reporting Requirements

The Bill removes the requirement for the Conditions Report to be submitted by a prescribed date, and instead requires that the Conditions Report be provided to the Minister as part of the Annual Report due under the Financial Management Act 1994. This would allow the inclusion of the Conditions Report in CMA annual reports to meet this requirement—rather than duplicating with a separate Conditions Report.

The new provisions of the Bill will commence on a day or days to be proclaimed with a default commencement date of 1 July 2023.

I commend the Bill to the house.

Mr WALSH (Murray Plains) (15:23): I move:

That the debate be adjourned.

Motion agreed to and debate adjourned.

Ordered that debate be adjourned for two weeks. Debate adjourned until Thursday, 30 September.