John Watson (Tasmania, Liberal Party) Share this | Link to this | Hansard source

I present the 113th report of the Standing Committee on Regulations and Ordinances on consultation under the Legislative Instruments Act 2003.

Ordered that the report be printed.

I move:

That the Senate take note of the report.

Under that act, departments and agencies which make legislative instruments are required to undertake ‘appropriate consultation’ before making an instrument, particularly where that instrument is likely to have a direct or a substantial indirect effect on business, or to restrict competition.

In determining whether any consultation is ‘appropriate’, departments and agencies can have regard ‘to any relevant matter’, including the knowledge of experts, and the views of persons likely to be affected.

Consultation is not required for all instruments, and the act gives some examples of instruments for which consultation may be unnecessary or inappropriate. For example, those of a machinery nature, urgent instruments, those that affect budget decisions, those that affect national security, those where adequate consultation has been undertaken by someone else or those relating to the Australian Defence Force.

Under section 19 of the act, if there is a failure to consult, it does not affect the validity or enforceability of an instrument—and that is important.

Finally, under section 4 of the act, information about consultation is to be included in the explanatory memorandum tabled with an instrument. In summary, under the consultation regime in the act, departments and agencies do not have to consult with anyone, but they do have to tell the parliament what they have or what they have not done.

Unfortunately, over the past two years, the committee has raised a number of concerns in relation to this consultation regime—and that is the reason for this report today.

First, we are concerned about the number of times we have had to write to departments and agencies reminding them of their obligation to give this information to the parliament—specifically, 110 times in 2005, 53 times in 2006 and a proportionate number of times so far this year. Two and a half years is surely enough time for departments and agencies to have become aware of this obligation.

At the moment, the duty to include consultation information is hidden away in the definition of ‘explanatory statement’ in section 4 of the act. It may be that making it more prominent might make more departments and agencies aware of it.

Our second concern is with the quality of the information provided. Too often, the explanatory statement simply says, ‘All relevant stakeholders were consulted,’ or ‘All persons likely to be affected were consulted,’ and ‘All views were taken into account in the drafting of the regulation.’ This sort of comment is cursory, generic and unhelpful—both for the committee and for anyone else reading the explanatory statement. It is often the case that a significant amount of consultation has, in fact been undertaken; it is just that no-one is told about it.

Our third concern is to correct a misconception regarding the operation of the act. The committee often sees a statement to the effect, ‘No consultation was undertaken because this instrument has no effect on business.’ The act requires consultation where an instrument has an effect on business or restricts competition, but if an instrument does not have that effect the act does not excuse it from consultation. You may still have to consult about an instrument even though it does not affect business.

Our final concern is that some of the exceptions under the act seem to have been resorted to in a somewhat questionable manner. Explanatory statements say that consultation was not undertaken because an instrument was of ‘a minor machinery nature’. However, the instrument itself seems to be a little more significant than that, and makes significant changes to current arrangements, or consultation was not undertaken because an instrument was ‘urgent’. However, there is no explanation as to why the instrument was urgent.

The committee proposes to examine these issues in greater detail and, if necessary, report further to the Senate in late 2007. I thank the Senate.

Andrew Bartlett (Queensland, Australian Democrats) Share this | Link to this | Hansard source

I appreciate that people are trying to get through a lot of business so I will be brief, but this is important. One of the reasons I think this report needs to be made is precisely because people rush through things because there is a lot of work to be done. This committee, which I have been on for quite a few years now, does not do reports very often and the fact that it has felt moved to do a report—an interim report—about this issue signals that there is a matter of concern. Some of the newer senators around may not know the whole history behind the Legislative Instruments Act. It goes back to the Keating era, when it was first put forward to reform, change and modernise the way we deal with legislative instruments. It took, I think, seven or eight years before agreement was eventually reached about how to do that and the Legislative Instruments Act came into force. One of the key sticking points was around how much consultation there should be in putting together legislative instruments, and what penalty there would be if appropriate consultation did not occur.

As it panned out, there was no penalty if consultation did not occur. The concern voiced by those who were anxious about that at the time has been proven to have some substance. They thought that if you did not have a penalty in place then there would be no real requirement for people to do it, or do it properly. As Senator Watson has just very eloquently outlined, there are a widespread number of legislative instruments where consultation has not taken place or where there has been no indication given of what consultation has taken place.

There is certainly no real feeling in many, many cases that there is an understanding or awareness that this is an integral part of what is required in developing legislative instruments. That is what is in the law, so it is an important thing to flag, and I urge every minister in the place to take notice. Senator Scullion and some of the newer ministers in the place should take note that it can make ministers look bad through no fault of their own. They are obviously just provided with the instruments. They are not the ones who go out and develop them but they sign off on them. It can reflect poorly on ministers and departments when such a fundamental part of a legislative instrument is not properly complied with.

I hasten to add that it might feel as if we have a lot of bills to deal with in this place—and we do—but the number of legislative instruments each year is in the thousands. The fact that they are mostly boring, tedious administrative matters might make it appear as if it does not really matter, but boring, tedious administrative matters impact on people’s lives once they become the law, and if there is no proper consultation before they become the law then people can get caught in very unintended consequences. The font of all wisdom does not lie with the government—whoever is the government of the day—or with the bureaucrats of the day. People who are affected should be consulted, not least because they are likely to have a good idea of what the consequences might be. As this report shows, that is not happening as much as it should, or as comprehensively as it should. That is a matter of serious concern. It is not a policy matter; it is a matter of good public administration—and that is what we should aspire to, whatever our particular policy and philosophical views are. I seek leave to continue my remarks.

Leave granted; debate adjourned.