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Thursday, 21 October 1999
Page: 12214

Mr GEORGIOU (10:45 AM) —The Customs (Tariff Concession System Validations) Bill 1999 is designed to remedy any invalidity in the decisions made by officers of the Australian Customs Service in relation to the operation of the tariff concession system between July 1996 and May 1999. Basically, decisions relating to the tariff concession system—a system which imposes a concessional rate of duty where there is no local manufacture of substitutable goods—are made by customs officers.

In November 1995, the Chief Executive Officer of Customs generally delegated his powers and functions relating to the system to nominated customs officers, and that was a delegation which took place under the previous government. Following changes to the tariff concession system in July 1996, amendments were made to the Customs Act and new powers and functions were introduced. At that time, Customs believed—and I am uncertain that this is the base of the assertion that it was against advice—that the chief executive officer's general delegation of November 1995 covered the exercise of these new powers and, accordingly, it was believed that no new delegations were necessary and, in fact, no new delegations were made.

In May 1999, however, doubts were raised over the efficacy of the general delegations issued in 1995 in the course of a matter which, as the previous speaker, the member for Denison, has noted, was before the AAT, but not on this precise matter. Subsequently, the Chief Executive Officer of Customs revoked existing delegations and issued new ones covering all powers and functions relating to the tariff concession system with effect from 1 June 1999. The fact, however, is that it is possible that tariff concession decisions made between July 1996 and June 1999 may not have rested on the basis of adequate delegations.

The bill does address this possibility and is designed to remove any doubt about the validity of decisions that relied on a delegation that may have been inadequate. There has been some suggestion made in the course of this debate, and outside this House, that the bill may be in breach of section 51(xxxi) of the Constitution as a law for the acquisition of property on unjust terms. As the bill takes steps to validate the collection of customs duty, it is a law with respect to taxation. The chief general counsel for the Commonwealth has provided the Commonwealth with advice that the bill is not a law with respect to the acquisition of property with respect to section 51. There are some parties who sought a review of aspects of the tariff concession prior to 1 June 1999. The bill will preserve the rights of these parties to have their cases considered and resolved.

There is an element of retrospectivity involved in this legislation, and retrospectivity is quite undesirable. The mitigating factor in this case, insofar as there are any shades of grey involved in the issue of retrospectivity, is that this was a matter that went to the technicality of a delegation, rather than being the retrospective imposition of an obligation that people did not believe existed. In this instance, the retrospective aspects of the legislation perform a technical remedy designed to protect the revenue. It should be recognised that the Labor Party is supporting this bill, despite a mammoth conflict between principle and political expediency, and I think that needs to be noted.

Mr Slipper —It was too precious, don't you think?

Mr GEORGIOU —I think there was a point there and I think most political parties would be tempted. But, in this particular case, I think the demands of good public policy and the impact on the revenue are such as to override those. In fact, I believe that the Labor Party, both in the Senate and in this debate, while drawing attention to their concern, came to the correct bottom line, and that is in the interests of good public policy.

There has been a departmental oversight, error—call it whatever you will—which this bill is now required to overcome in order to protect the revenue. The magnitude of the revenue involved is substantial. It is unfortunate that we have had to introduce a retrospective element in order to do that. Having made that observation, I commend the bill.