Ross Cadell (NSW, National Party) Share this | Hansard source

On behalf of Senator Dean Smith, the Chair of the Standing Committee for the Scrutiny of Bills, I present Scrutiny digest No. 3 of 2024 of the committee, together with ministerial correspondence received by the committee. I seek leave to incorporate the document in Hansard.

Leave granted.

The document read as follows—

As Chair of the Senate Standing Committee for the Scrutiny of Bills, I rise to speak to the tabling of the committee's Scrutiny Digest 4 of 2024.

Scrutiny Digest 4 of 2024 reports on the committee's consideration of twelve bills which were introduced into the Parliament during recent sitting weeks, as well as amendments made to 1 bill.

In the Digest, the committee has identified potential scrutiny concerns in relation to 3 newly introduced bills. The Digest also contains the committee's comments on recent ministerial responses in relation to 10 bills.

The committee welcomes undertakings made in relation to bills which partially address scrutiny concerns raised by the committee. These include undertakings to amend the Digital ID Bill 2023 to provide for the tabling of reports in Parliament, and a commitment by the Minister for Finance in relation to the Appropriation Bills (Nos 3 and 4) 2023-2024 to consider improving guidance on budget measures marked as not for publication. The committee thanks the Minister for Finance for her constructive engagement with the committee.

In this Digest, the committee has commented on the retrospective validation or application of legislation in relation to an unusually high number of bills.

The committee has long-standing scrutiny concerns about provisions that have the effect of applying retrospectively, as it challenges a basic value of the rule of law that, in general, laws should only operate prospectively. The committee has a particular concern if the legislation may have a detrimental effect on individuals. In such cases the committee expects the explanatory materials to set out the reasons why retrospectivity is sought, whether any persons are likely to be adversely affected and the extent to which their interests are likely to be affected. As the purpose of such an explanation is to assist the committee, and ultimately the Parliament, to reach a conclusion as to the impact that a measure might have on personal rights and liberties, the proponents of legislation should take the broadest possible view of the interests that could be adversely affected.

Further, the committee expects that such analysis should take into account the possibility that the previous actions were not undertaken in accordance with the law regardless of the Government's views on the remoteness of this possibility. The detrimental impact could then be balanced against the policy justification for the validation provisions, of which the intention of the Parliament in enacting the provisions, and the remoteness of the possibility of legal invalidity would be relevant factors.

This issue was highlighted by the committee in its comments on retrospective validation provisions in the Autonomous Sanctions Amendment Bill 2024. The Minister's response to the committee's scrutiny concerns indicated that no Australians or Australian business would likely be adversely affected as the bill confirmed the validity of existing sanctions listings. However, if the validity of the listings is in question, as evidenced by the inclusion of the validation provisions in the bill, an assessment of the adverse affect on people should not commence from the assumption of validity. Instead, in order to assist the committee, and ultimately the Parliament, to reach a conclusion as to the appropriateness of retrospective validation, information should be provided concerning its impact in the event that past actions were invalidly taken.

Any litigation on foot and any past court decisions that the bill seeks to respond to should also be detailed.

Similarly, I would also like to draw the Senate's attention to the committee's comments on the Financial Framework (Supplementary Powers) Amendment Bill 2024.

The bill seeks to amend section 32B of the Financial Framework (Supplementary Powers) Act 1997, which was inserted into the Act in response to the decision of the High Court in the Williams case. In that case, the Court held that, in most cases, the Executive requires statutory authority before it can enter into contracts and spend public money.

The section purports to provide this statutory authority by providing for the Executive to make legislative instruments setting out how its own powers to contract and to spend are to be expanded. The amendments in the current bill seek to clarify that instruments may do so even where the power to enter into such contracts and spend money exists in other legislation. The bill also seeks to provide for retrospective validation of past spending in the event that the spending was not previously authorised.

While the explanatory memorandum to the bill states that the changes are wholly beneficial in operation by negating any risk of invalidity of payments, it is unclear to the committee that this is necessarily the case if a broad view of the types of interests that may be affected is taken.

In this instance, it appears to the committee that retrospective validation could impact the rights of people with an interest in challenging the validity of spending for a particular purpose. As such, it would be appropriate for the explanatory materials to weigh any detrimental affect the provision could have on the interests of people against the benefits of providing clarity and certainty. This would enable the Parliament to make a fully informed decision as to whether the retrospective validation proposed unduly trespasses on personal rights and liberties.

The committee has sought further advice in relation to when and how the need for the amendments proposed by the bill and the retrospective validation of past uses of the power under section 32B became apparent during the Department of Finance's review of the operation of the Act.

Apart from the appropriateness of the retrospective validation of past spending, the committee also has fundamental scrutiny concerns regarding the mechanism provided under section 32B of the Act. This is due to the insufficient parliamentary scrutiny and oversight of public expenditure involved, and the inappropriate delegation of legislative powers to the Executive.

The committee is not persuaded by the Minister for Finance's advice to the committee that the fact that government spending has already been agreed to by the Government provides sufficient justification for the legislative provision. The committee considers that it is appropriately a matter for the Parliament to determine whether spending for a particular policy purpose should be so authorised. As such, the committee draws the attention of senators to the appropriateness of authorising, via regulation, the expenditure of public money.

I encourage all parliamentarians to carefully consider the committee's analysis contained in the Digest. With these comments, I commend the committee's Scrutiny Digest 4 of 2024 to the Senate.