Thursday, 14 November 2019

 The PRESIDENT (18:08): I have a further message from the Assembly:

The Legislative Assembly presents for the agreement of the Legislative Council ‘A Bill for an Act to amend the Electricity Safety Act 1998 and the Energy Safe Victoria Act 2005 in relation to Energy Safe Victoria and certain classes of electrical work and to make consequential and related amendments to certain other Acts and for other purposes’.

 Mr SOMYUREK (South Eastern Metropolitan—Minister for Local Government, Minister for Small Business) (18:08): I move:

That the bill be now read a first time.

Motion agreed to.

Read first time.

Mr SOMYUREK: I move, by leave:

That the second reading be taken forthwith.

Motion agreed to.

 Mr SOMYUREK (South Eastern Metropolitan—Minister for Local Government, Minister for Small Business) (18:08): I lay on the table a statement of compatibility with the Charter of Human Rights and Responsibilities Act 2006:

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 Energy Safety Legislation Amendment (Victorian Energy Safety Commission and Other Matters) Bill 2019 (the Bill).

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

Overview

The Bill:

• amends the Energy Safe Victoria Act 2005 to establish a new governance structure for Energy Safe Victoria as a three-member Commission supported by a Chief Executive Officer, with a Ministerial power of direction and a Technical Advisory Committee appointed by the Minister, and thereby to strengthen Energy Safe Victoria’s regulatory decision-making and transform it into an effective, modern safety regulator;

• amends the Electricity Safety Act 1998 to establish an electrical lineworker licensing scheme; and

• makes consequential and related amendments to certain other Acts and for other purposes.

Human rights issues

Section 13—Privacy and reputation

Section 13 of the Charter provides that a person has the right not to have his or her privacy, family, home or correspondence unlawfully or arbitrarily interfered with, and the right not to have his or her reputation unlawfully attacked.

The right to privacy is relevant to various provisions in the Bill which either require or permit the disclosure of personal information which may otherwise be considered private.

Obtaining the personal information of applicants

Clauses 3 to 9 of the Bill amend the Electricity Safety Act 1998 to establish an electrical lineworker licensing scheme, in the same way the Act now requires other kinds of electrical workers to be licensed. Under the Electricity Safety (Registration and Licensing) Regulations 2009, applicants for licences must provide information about their skills, qualifications and experience and this may include personal information.

Although the right to privacy is relevant, persons who are seeking to participate in a regulated industry necessarily have a diminished expectation of privacy. The information that will be sought is necessary for determining an applicant’s eligibility to be licensed and for ensuring only appropriately qualified persons are engaged in linework on Victoria’s transmission, distribution and traction (rail and tram) networks.

In my opinion, there will be no limitation on the right to privacy where information is obtained and handled within the confines of the Act and Regulations.

Victorian Energy Safety Commission

Under the Bill, the Victorian Energy Safety Commission (the Commission) will consist of three persons with skills, qualifications, knowledge and experience in relevant specified areas who are recommended by the Minister. The Bill also sets out the procedures by which the Commission will make its decisions and what disclosures must be made by its members.

In particular, the new section 10M in clause 25 requires a Commissioner who has a pecuniary interest in a matter that is to be considered by the Commission to declare the nature of that pecuniary interest at a meeting of the Commission or, in the case of a disclosure by the Chairperson, to the Minister. Failure to do so may lead to removal from office under new section 10G(2) in clause 25.

The new section 17 in clause 26 likewise requires the Chief Executive Officer to declare any pecuniary interest to the Commission.

The requirement for Commissioners and Chief Executive Officer to declare pecuniary interests may operate to require the disclosure of personal information, including financial information. As such, it may engage the right in section 13(a) of the Charter. However, the requirements in new sections 10M and 17 are an important and appropriate means of avoiding potential conflicts of interest that could undermine the integrity and internal transparency of decision-making. The obligation is clear and confined, serves a legitimate purpose and does not arbitrarily limit the right to privacy. I therefore consider new sections 10M and 17 to be compatible with the right to privacy.

The right to privacy and reputation in section 13 of the Charter may also be relevant to the appointment process for Commissioners and Acting Commissioners (new sections 10D and 10H in clause 25), the Chief Executive Officer and an Acting Chief Executive Officer (new sections 14 and 15 in clause 26) and members of the Technical Advisory Committee (new section 22F in clause 30). Appointees may be required to share information about their private lives such as their other interests, positions or associations.

The Bill provides as well for removal from office of Commissioners (new section 10G in clause 25) which engages the right to privacy and reputation as a person’s private life may contribute to the ground for removal and removal may affect reputation.

However, these provisions serve the legitimate purpose of ensuring appointment of appropriately skilled persons and are consistent with best practice principles of corporate governance. Accordingly, I consider that any interference with the right to privacy and reputation in the Bill is neither arbitrary nor unlawful. The provisions in question are clearly set out, underpin good governance and ensure that the Commission’s functions are performed free from any perception of bias or conflict of interest.

For these reasons, I am satisfied that the Bill does not limit the right to privacy and reputation.

Section 15—Freedom of expression

Section 15 of the Charter provides that every person has the right to freedom of expression, which includes the freedom to impart information and ideas of all kinds. The right has also been held to include the right not to impart information.

The right in section 15 of the Charter is relevant to clause 28 of the Bill which substitutes section 25 of the Energy Safe Victoria Act 2005 to prohibit a person who is, or has been, a Commissioner, the Chief Executive Officer, an employee and other specified persons from making improper use of any information acquired in the course of the person’s duties to obtain, directly or indirectly, any pecuniary or other advantage. The substituted section 25 makes it an offence to do so with a maximum penalty of 100 penalty units.

The substituted section 25 is directed at ensuring the maintenance of confidentiality of information, which may include both private and commercial information, obtained during the course of a person’s duties and ensuring those with authority do not use information so gained to advance their own or another person’s interests.

As such, to the extent that the substituted section 25 may impose a restriction on a person’s right to freedom of expression, I am satisfied that such a restriction is both lawful and reasonably necessary to respect the rights and reputations of other persons and for the purpose of public order within the exceptions in section 15(3) of the Charter.

Section 18—Taking part in public life

Section 18(2)(b) of the charter provides that every eligible person has the right, and is to have the opportunity, without discrimination, to have access to the Victorian public service and public office. This right requires access to positions in the public service and in public office to be based on general terms of equality.

This right is engaged through several clauses of the Bill. As noted above, the Bill: sets criteria for appointment as a Commissioner or member of the Technical Advisory Committee; provides for terms and conditions of appointment as a Commissioner, the Chief Executive Officer and a member of the Technical Advisory Committee; provides for decisions by a quorum of two rather than three Commissioners; and excludes Commissioners from deliberating on matters in which they have declared a pecuniary interest. (See new sections 10B, 10D, 10K, 10M, 14, 22D and 22F in clauses 25, 26 and 30.)

These provisions may be perceived as effecting a person’s access to the public service. In fact, they facilitate equal opportunity to the public service, based on general principles of merit, and facilitate effective governance practices. The criteria and processes for appointment and involvement in decision-making are objective, reasonable and non-discriminatory.

The Bill also provides grounds for removing Commissioners (new section 10G in clause 25) and abolishes the existing Energy Safe Victoria and the office of Director of Energy Safe Victoria (new sections 45 and 46 in clause 32). These provisions engage and limit the right to take part in public life because they affect access to the public service for existing position holders. However, the provision for removal of Commissioners is justified to facilitate good corporate governance and to hold Commissioners to account for their responsibilities. Similarly, the abolition of the existing body and office of Director is necessary to establish the new governance framework.

Therefore, I consider that to the extent that these provisions may be seen to impose a restriction on a person’s right take part in public life, they are reasonable limitations that are justified in a democratic society.

Section 20—Right to property

Section 20 of the Charter provides that a person must not be deprived of his or her property other than in accordance with law. This property right is relevant to several provisions in the Bill.

As noted above, the Bill abolishes the existing Energy Safe Victoria and the office of Director of Energy Safe Victoria. The newly constituted Energy Safe Victoria will be the successor in law and any contracts, legal proceedings and other continuing matters will therefore not be affected. Staff will be transferred with all entitlements. (New sections 45, 46 and 48 in clause 32.)

The holding of public office is not ordinarily regarded as property, so the loss of office as Director does not involve a loss of property rights. The rights of employees, contractors and others are protected by the Bill.

Therefore, in my opinion the provisions of the bill are compatible with the right to property in section 20 of the Charter.

Section 26—Right not to be tried or punished more than once

Section 26 of the Charter provides that a person must not be tried or punished more than once for an offence in respect of which they have already been finally convicted or acquitted in accordance with law.

This right is engaged by new section 10G in clause 25 of the Bill which provides for office of a Commissioner to become vacant if the Commissioner is convicted or found guilty of an indictable offence and for the Minister to recommend a Commissioner to be removed from office in the case of other offences under energy safety legislation.

To the extent that new section 10G might limit rights under section 26 of the Charter, the limitation will protect the integrity of Energy Safe Victoria and public confidence in its operations. The purpose is not to impose further punishment, but rather is to ensure that only fit and proper persons hold office as Commissioners.

Therefore, I am of the opinion that any limitation imposed by clause 25 of the Bill on the right of a person not to be punished more than once for an offence for which the person has been finally convicted is reasonable and justified under section 7(2) of the Charter.

Conclusion

For the above reasons, I consider that the Bill is compatible with the Charter of Human Rights and Responsibilities because to the extent that some provisions may limit human rights, those limitations are reasonable and demonstrably justified in a free and democratic society.

Hon. Gavin Jennings, MP

Special Minister of State

 Mr SOMYUREK (South Eastern Metropolitan—Minister for Local Government, Minister for Small Business) (18:09): I move:

That the second-reading speech be incorporated into Hansard.

Motion agreed to.

Mr SOMYUREK: I move:

That the bill be now read a second time.

Incorporated speech as follows:

Safety and community are at the heart of the Energy Safety Legislation Amendment (Victorian Energy Safety Commission and Other Matters) Bill 2019, before you today.

In 2017, I started the transformation of Victoria’s gas and electricity network safety by commissioning a review of the State’s safety framework. The Review found a number of areas for improvement that the Government supported, including strengthening the governance of Energy Safe Victoria, and broadening its capabilities and preparedness to take strong regulatory action. We need the utmost vigilance when it comes to energy safety and keeping our communities out of harm’s way.

This is why this Bill is so important, and the changes it introduces will have long term benefits to the safety of Victorians.

This Bill has two key elements, along with some housekeeping amendments.

The first element is amending the Energy Safe Victoria Act 2005 to reform the governance of Energy Safe Victoria, or ESV, the state’s technical and safety regulator responsible for the safe generation, supply and use of electricity, gas and pipelines.

This Bill proposes strengthening ESV’s regulatory decision-making and transforming it into an effective, modern safety regulator for electricity and gas by establishing it as a three-member commission supported by a Chief Executive Officer and a Technical Advisory Committee, with a Ministerial power of direction.

The very important work ESV does includes licensing electricians, ensuring electrical and gas products are approved and safe for use, regulating the prevention and mitigation of bushfires caused by electric lines and investigating electrical and gas incidents.

ESV employs around 150 staff and is funded through industry levies and other licensing fees.

Since 2005, ESV has been established as a single member statutory office, with the Director of Energy Safety the sole regulatory decision maker, employer, and with the functions of the CEO.

The proposed governance arrangements stem from a detailed review into gas and electricity safety, that I commissioned in January 2017. As it had been over a decade since the current energy network safety framework was put in place, the Independent Review of Victoria’s Electricity and Gas Network Safety Framework, conducted by Dr Paul Grimes, examined Victoria’s energy safety arrangements and made recommendations to ensure that the future needs of the Victorian community are reflected.

The Grimes Review’s final report followed detailed analysis and public consultation with a wide range of industry stakeholders, consumer groups and other interested parties and its recommendations were designed to position Victoria at the forefront of safety regulation of electricity and gas networks.

The review found that while Victoria has many of the key elements of a leading network safety framework, there were also areas for improvement, including strengthening the governance of ESV and broadening its capabilities and preparedness to take strong regulatory action.

Importantly, changes to ESV’s structure, and its establishment as a Commission, which I will outline in detail shortly, will assist in the implementation of many of the other reforms supported in the Government Response to the Grimes Review, including:

• strengthening ESV’s internal management systems and processes;

• enhancing its auditing and inspection regime;

• implementing an improved data analytics and management process;

• providing a broader suite of compliance and enforcement tools; and

• increasing penalties for non-compliance.

The establishment of a three-person Commission, supported by a separate Chief Executive Officer and a Technical Advisory Committee, will ensure it accesses a broader range of perspectives and experience in decision-making, a need identified in the Grimes Review.

Collectively, commissioners are to have skills, qualifications, knowledge or experience in law, economics, regulation and community safety. The inclusion of community safety in the commissioners’ skill set reflects the need to focus on and consider communities in the energy safety decision-making process.

The Commission will be responsible for regulatory decisions.

One Commissioner will be appointed as Chairperson, one as Deputy Chairperson and there will be one additional Commissioner. Each Commissioner will hold office for a term of up to five years, and is not eligible to be appointed for more than two terms. Commissioners may be appointed on a full-time or part-time basis.

The role of Chief Executive Officer supporting the Commission will involve responsibility for the day-to-day management and administration of ESV’s affairs. This governance structure reflects current best practice and is consistent with the way in which other, modern regulators are set up, including the Environment Protection Authority Victoria and WorkSafe Victoria.

In its current form, ESV’s Director of Energy Safety has emergency powers of direction to make an emergency situation safe, which are set out in the Electricity Safety Act 1998 and the Gas Safety Act 1997. These include powers to direct the disconnection of the supply of gas or electricity; stop the use of gas or electrical equipment; or stop a work practice.

With the establishment of the Commission these emergency powers will be vested in the Chairperson, who may then delegate the powers to another commissioner, the CEO or employee of ESV, following Ministerial consent.

The Bill also proposes the establishment of a Technical Advisory Committee to ensure ESV accesses a range of views and experience from outside the organisation on a broad range of regulatory safety matters. The Committee is to include those who represent the electricity and gas industries, employees in those industries, as well as members of the community. As Minister, I would appoint the members of the Committee.

If the Bill is passed, the Department of Environment, Land, Water and Planning will consult on the committee’s Terms of Reference with key stakeholders, and this will determine the committee’s membership, scope and operation, including public reporting.

Another important element of the Bill that strengthens the Government’s ability to ensure the safety of the community is through Ministerial powers to direct ESV in the performance of its functions and objectives; and recommend a commissioner for removal.

This differs to the current Act, whereby the responsible Minister has limited powers to set expectations of ESV’s performance and strategic direction, and to commission advice and inquiries into certain matters.

Ministerial powers of direction will enable greater oversight of ESV, to ensure the safety of Victorian community.

The greater ministerial oversight in the Bill includes provisions for the responsible Minister to issue directions regarding ESV’s performance of its functions, meeting of its obligations and exercise of its powers.

However, to ensure ESV’s independence is maintained, increased Ministerial power will be complemented by other measures, including limitations on Ministerial powers of direction and transparency requirements if powers are exercised, which include publication of any direction on ESV’s website and Annual Report; and appointment and removal of commissioners by the Governor in Council.

Importantly, the proposed amendments bring ESV’s arrangements into alignment with a range of similar regulators.

The second key element of this Bill is the establishment of an electrical lineworker licensing scheme, which if the Bill is passed, will commence on 1 January 2021.

This is an election commitment made by the Government that I am proud to be delivering. Electrical lineworkers are employed or contracted by network businesses for the construction and maintenance of electricity network infrastructure.

They work in a hazardous environment on high and low voltage electrical infrastructure and can work in the vicinity of live overhead wires. This includes:

• work undertaken on the transmission system on high voltage electricity infrastructure, including electricity terminal stations, transmission lines and towers, and transporting electricity from generators to distribution networks.

• work undertaken on the distribution system on low voltage electrical infrastructure, including powerlines, electrical substations, transformers, power poles, and transporting electricity through distribution networks to properties.

Currently, Energy Safe Victoria oversees the registration of electrical lineworkers, however following registration, it is the employing distribution businesses who manage them. There is no registration renewal requirement, meaning lineworkers remain registered whether they continue to work in the industry or not.

Progressing from a registration system to a licensing system will improve safety outcomes by enhancing ESV’s oversight of the electricity networks through better accountability and visibility of the workforce and mandating the minimum qualifications, training and experience electrical lineworkers require.

Improved workforce data will enable ESV to better analyse potential trends or emerging safety risks in relation to the workforce, and will improve professional standards through mandating the minimum qualifications, training and experience required to work on the electricity networks.

There are over 4,000 registered lineworkers who require licensing, as well as approximately 210 apprentices currently undertaking relevant qualifications over the next three years.

This Bill makes minor amendments to the Electricity Safety Act 1998 to enable the establishment of the scheme in regulations.

If the Bill is passed, the re-making of the regulations in 2020 will involve comprehensive stakeholder consultation on the licensing scheme’s design, including the minimum requirements for qualifications, training and experience required to obtain a licence, the scope of work, transitional arrangements, mutual recognition and the licence funding model.

The Government committed $2.511 million as part of the 2019–20 State Budget to establish the scheme. This funding allows the first round of licensing to be provided at no cost.

In closing, I would like to come back to the topic of communities. Recent coronial inquests, electricity network-caused fires and examples of non-compliant asset and vegetation management practices of regulated entities have reinforced the need to strengthen energy safety governance and regulatory effectiveness.

The proposed reforms seek to reduce the likelihood of such incidents in future. The establishment of ESV as a commission will further enable it to have the right systems, processes and capabilities in place to do its job efficiently and effectively and hold distribution businesses to account. The establishment of an electrical lineworker licensing scheme will further enhance ESV’s oversight of industry.

I have assured the community that their safety is the highest priority of this Government, and I will continue to focus my efforts and those of my Department on addressing their concerns.

The introduction, and I trust, the passage, of this Bill shows that we are unwavering in our commitment to delivering a safer Victoria.

I commend the Bill to the house.

 Mr RICH-PHILLIPS (South Eastern Metropolitan) (18:09): I move:

That debate on this bill be adjourned for one week.

Motion agreed to and debate adjourned for one week.