Senator CALVERT(3.59 p.m.) —At the request of Senator O'Chee, on behalf of the Regulations and Ordinances Committee I present a paper entitled `The impact of the Regulations and Ordinances Committee on administrative law and ethics', which was presented to the Administrative Law and Ethics Conference in Canberra on 24 November 1997. I seek leave to have the paper incorporated in Hansard .

Leave granted.

The paper read as follows—

The Impact of the Regulations and Ordinances Committee on Administrative Law and Ethics

Ladies and Gentlemen

The title of this conference is Administrative Law and Ethics. Dicey defined administrative law as the law relating to the organisation, powers and duties of administrative authorities. It has been defined further as the body of rules which govern the exercise of executive functions by the officers or public authorities to whom they are entrusted. The courts have always had a role in these rules governing the exercise of executive functions by their issue of prerogative writs, which restrained public officials from exceeding the proper limits of their authority or which compelled them to act properly.

In Australia, however, at the Commonwealth level, administrative law has come to mean the group of reforms, all made by Act of Parliament, which in the mid nineteen seventies and early nineteen eighties effected what has been described as a revolution in Commonwealth law establishing the relationship between officials and those citizens affected by their actions. These well known reforms include the Administrative Appeals Tribunal, the Ombudsman, the Administrative Review Council, the Freedom of Information Act and the Administrative Decisions Judicial Review Act. There have been further developments of these reforms, such as specialist merits review tribunals for such groups as, for instance, refugees, and, in an area with which I am familiar, the Legislative Instruments Bill.

It is conventional wisdom that these reforms were the first important changes in administrative law at the Commonwealth level and that what might be called the modern era of Commonwealth administrative law dates from their introduction. I would, however, like to challenge this conventional wisdom. If administrative law is the systematic and effective scrutiny and supervision of the actions of the executive with appropriate remedies for improper executive actions, then modern Commonwealth administrative law dates from the establishment of the Senate Standing Committee on Regulations and Ordinances in 1932. The Committee scrutinises all disallowable instruments for breaches of parliamentary propriety or personal rights and obtains undertakings from Ministers to amend the offending instrument or a satisfactory explanation of the apparent deficiency. The Senate has never failed to accept a recommendation from the Committee that it disallow an instrument, although we don't do this too often. In fact, the last time the Committee resolved formally to recommend disallowance if the Minister did not undertake to amend was almost two years ago. This role of the Committee as both a premier and continuing central body in administrative law should be more widely known and acknowledged.

Of course the Committee does not have a comprehensive jurisdiction over all executive activities, but none of the other bodies more often associated with Commonwealth administrative law has this comprehensive authority either. Moreover, none of them has a direct legislative control over the actions of the executive government. For instance, the AAT has strong powers but a limited jurisdiction, the Ombudsman has wide coverage but limited powers, the Federal Court under the ADJR Act has wider coverage than the AAT but no power of merits review, while there are many exemptions under the Freedom of Information Act.

In contrast, the Regulations and Ordinances Committee scrutinises disallowable instruments, which form the basis of the detailed administration of almost all Commonwealth programs, with the power to recommend disallowance of any instrument or provision of an instrument. In its coverage and powers the Committee is in the mainstream of Commonwealth administrative law, and was in this position for up to half a century before other reforms which are more usually associated with such law.

The Senate has come to expect this rigorous application by the Committee of its principles, with a wide range of Senators both in and out of government supporting the rights and liberties of citizens against arbitrary decision making by the executive. It is no coincidence that successive Attorneys-General at the zenith of the development of administrative law were both Senators and had both been active and long-standing members of the Committee.

The Committee has, however, integrated the newer administrative law bodies into its operations. For instance, it insists that appropriate discretions should be reviewable by the AAT and that decision makers consult the Privacy Commissioner in suitable cases. This combination of the Committee and those other bodies provides additional safeguards in individual cases.

The development of administrative law by the Committee has also enhanced ethical behaviour by public officials. The Oxford dictionary defines ethics as the science of morals in human conduct. It defines moral as that which in concerned with goodness or badness of human behaviour, or with the distinction between right and wrong. In the context of this discussion, therefore, ethics really relates to public officials having a conscientious commitment to ensuring that laws and their administration are guided by morality and not merely by an apparent adherence to form or process. In short, the spirit of the law should be based on what is fair and right.

The best way to illustrate the impact of the Committee on administrative law and ethics is to outline a number of actual cases where the Committee raised issues which may have ethical implications. The Committee has reported to the Senate on each of these cases and if conference delegates would like further details of any of them they should contact the Committee staff in Parliament House.

Although I have spoken so far about scrutiny of the activities of the executive the operations of the Committee include scrutiny of the Rules of Court made by the judges of each of the federal courts. These Rules are legislative in nature and disallowable by either House and the Committee subjects the rules to the same scrutiny as other delegated legislation. The Committee, through its scrutiny, has improved the quality of the Rules of the different courts. For instance, in one case, the Committee found that the judges of the High Court had made Rules which operated with prejudicial retrospectivity. The Chief Justice, Sir Harry Gibbs, then advised the Committee that the Rules would be amended. In another case the High Court advised the Committee that provisions for reversal of the usual onus of proof, about which the Committee had concerns, would be removed. In respect of another instrument the Chief Justice, Sir Anthony Mason, advised the Committee that its concerns about clarity of legislation would be met. The Committee has also written a number of times to the present Chief Justice of the High Court about deficiencies in the Rules.

Industrial Relations Court Rules

It is, however, the Industrial Relations Court Rules which I will use to illustrate some issues of ethics and the impact of the Committee. Those Rules, all 278 pages, were made by nine judges of that Court, including the Chief Justice. The Rules included numerous drafting errors, chiefly wrong cross-references, although there was one provision which subsequently everyone seemed to agree was void because it was not authorised by the enabling Act. The principal concern of the Committee, however, was that the Rules were made and expressed to come into operation on 30 March 1994, but were not gazetted until more than five weeks later. Under the relevant provision of the Acts Interpretation Act, the Rules were therefore void if they affected anyone adversely, apart from the Commonwealth or its authorities. After some correspondence and some hesitation the Acting Chief Justice then advised the Committee that the entire Rules would be repealed and remade, so that the Rules would operate with unambiguous validity. The Acting Chief Justice also advised that officers of the Attorney-General's Department had offered to assist the Court to do this. In due course this was done.

What are the implications for administrative law and ethics of this episode? The first point is that, in the view of the Committee, the administration of justice by the courts should be conducted in accordance with the highest ethical standards. In cases such as this the ethics of all concerned should be beyond reproach and the action of the Chief Justice and the other judges in repealing and remaking the Rules was of a high ethical standard, even if this was done after considerable arm twisting by the Committee. The problem remains, however, that the new valid Rules were not made until six months after the old defective Rules purported to come into effect and four months after the Committee drew attention to the problem. The Committee understands that during this time actions in the Court proceeded at full steam, during the first two months because the Court was unaware that there was problem and during the next four despite knowledge that there was a difficulty. In this time it appears that numerous individuals had action taken against them under the invalid Rules, presumably with threats of violence to their person and property for any recalcitrant behaviour. For instance, the Rules provided for arrest and committal. I think that the actions of the judges in respect of this period could be seen as not of the highest ethical standard.

What, then, should the judges have done in this case? The ethical response would have been to inform all persons adversely affected that the Rules may be void and that in the interests of justice the Court would order that all action taken under the Rules was consequently ineffective. This would certainly be the ethical position in respect of action taken under the Rules in the first five weeks during which they were not even gazetted. It is not acceptable for people to be subjected to prejudicial action under delegated legislation before there has been official notification that it has been made. The ethical position would also have been that those affected should have been paid compensation by the Commonwealth for any losses which they suffered. The impact of the Committee here was that it at least ensured that the Court accepted an ethical outcome, even if there was a gap of six months.

Crimes Regulations

There were similar ethical questions in relation to the next case which I will describe. The instrument in question was an amendment of the Crimes Regulations which was quite short and had only one purpose, to exempt the Australian Securities Commission from provisions of the Spent Convictions Scheme. That Scheme provides for important personal rights whereby, if a person was convicted of an offence more that 10 years ago and meets certain other criteria, then the conviction is spent and the person is legally able to claim, on oath or otherwise, that they were never convicted of the offence. Also, other people who are aware of the offence must generally not disclose the conviction without the consent of the person affected and must not take the conviction into account in any decision making process. The Act provides, however, for the Regulations to prescribe exemptions from the Scheme and the Regulations in question exempted the ASC in regard to all offences for the purposes of considering whether to prosecute, making submissions as to sentence, and assessing the suitability of a person to be employed by the ASC.

The Committee noted that the enabling Act for the Regulations provided for the Privacy Commissioner to receive applications for exemptions from the Scheme and to advise the Minister on whether an exemption should be granted. The Committee further noted that neither the making words of the Regulations nor the Explanatory Statement even referred to this requirement, much less that it had been observed, or to the substance of the Privacy Commissioner's advice, the obtaining of which was mandatory. The Committee assumed that this was because the matter was routine in nature, with no unusual or unexpected features. Nevertheless the Committee wrote to the Minister, in this case the Attorney-General, asking for confirmation that the Privacy Commissioner was consulted and, if so, of the result of those consultations.

The reply from the Attorney-General, dated three and a half months later, was quite a surprise. It advised that the Privacy Commissioner was indeed consulted, as required by the Act, but that the Attorney had declined to follow the Commis sioner's advice that the exemption should not be granted. This reply was of considerable concern to the Committee. It meant that the sole provision of the Regulations was contrary to an express recommendation of the Privacy Commissioner in respect of a statutory duty to provide such advice. This concern was compounded by the fact that, as a result of the delay in replying and of the making words and the Explanatory Statement omitting any reference to the Privacy Commissioner, the Committee assumed that there was nothing untoward about the Regulations and did not give a protective notice of disallowance. Also, importantly, the incomplete Explanatory Statement also meant that individual Senators with an interest in legislation affecting personal rights were not alerted to a matter of interest.

At this point I emphasise that the Committee did not draw any conclusions about the desirability or otherwise of the substance of excluding the ASC from the Scheme, which is a matter upon which well-informed and well-intentioned people may differ. The Committee was concerned, however, that the important issues which the Regulations raised were concealed, whether inadvertently or not, from the attention and scrutiny of the Senate. In this context I add that the Committee strictly avoids policy issues, but does attempt to ensure openness and accountability so that Senators may take informed action in respect of individual instruments.

After receiving this surprising advice the Committee wrote again to the Attorney-General, suggesting that the Regulations should be repealed and remade, with a complete Explanatory Statement. This would preserve the options of the Committee and the Senate but would not disrupt the existing arrangements pending informed parliamentary scrutiny. The Committee also wrote to the Privacy Commissioner, who advised that he appreciated the continued support of the Committee in seeking to promote a more open approach by agencies in relation to differences of view with his office, particularly where legislation was concerned.

The Attorney replied that he was not able to agree to repeal and remake the Regulations, or that the making words or Explanatory Statement for other instruments should include references to any statutory mandatory consultation before making and the result of that consultation. He was, however, prepared to adopt a practice under which the views of the Privacy Commissioner would be communicated to the Committee at the same time as any future Regulations were tabled. Unfortunately this suggestion was not satisfactory because the Explanatory Statement is produced for the benefit of all Senators, not just the Committee. Many notices of disallowance by individual Senators are given on policy grounds unrelated to the concerns of the Committee.

The Committee wrote again to the Attorney, advising that present Commonwealth drafting practice for legislative instruments appears to be to include sometimes lengthy recitals in the making words that statutory consultation requirements have been met. The Committee gave instances of such recitals. One particular instrument, drafted by officers of the Attorney-General's Department, actually recited that it was made after consultation with the Privacy Commissioner. The Committee advised the Attorney that it supported this practice and assumed that if the relevant consultations or advice led to results which were unusual or unexpected, such as a decision to reject the advice of the Privacy Commissioner, that this would be explained in the Explanatory Statement. The Committee suggested that the failure to do so in the present case was a breach of parliamentary propriety. The Committee also advised the Attorney that it would write to the Minister responsible for the Federal Executive Council Handbook, asking for the Handbook to be amended to reflect the views of the Committee.

I am pleased to report that the final result in this case was most satisfactory. In a further reply the Attorney advised the Committee that he now agreed that the relevant information should be included in the Explanatory Statement and that he would instruct the Department to adopt that practice in future. The Secretary of the Federal Executive Council also advised that a circular which would have the effect of a revision of the Handbook would be sent to all agencies, advising of the Committee's requirements.

In this case also I think that there were questions about the ethical standards of the officers of the Attorney-General's Department who had carriage of this matter. Public administration should be both transparent and accountable and, in my opinion, the officers involved failed to meet these standards. As with many of the matters which the Committee raises, there were two levels of ethical deficiency here. The first was the initial problem perpetrated by the Department and the second was the continuing refusal to address the difficulty even after the Committee had drawn their attention to it. The ethical response to the Committee in this case would, as noted earlier, have been to repeal and remake the Regulations in question. It is a matter for regret that this was not done. The Department, of course, finally accepted the views of the Committee and this is to their credit. The Federal Executive Council secretariat, in contrast to the tardiness of the Attorney-General's Department, are to be commended for promptly recognising the problem and initiating action to remedy it. Their actions reflect a high ethical standard.

Native Title (Notices) Determination No.1 of 1993

The next case study raises different ethical questions. The Native Title Act 1993 was assented to on Christmas Eve 1993 and on that same day the Minister for State made an important legislative Determination under the provisions of that Act. Unfortunately the Determination was never tabled in Parliament and consequently ceased to have effect 15 sitting days after it was made. The Committee picked this up more than two years later when the Minister for State made an amending Determination. The Committee noticed that there was no record of the original Determination and at once alerted the Department of the Prime Minister and Cabinet, who up until then were unaware of the failure to table. Shortly afterwards, in the House of Representatives, the Prime Minister in answer to a question advised that the effect of the failure could well cast a legal doubt over a large number of actions affecting the Aboriginal community, the pastoral industry and the mining industry. The Prime Minister further advised that a fresh Determination would be tabled later in the week. The States and other affected bodies would be consulted on remedial matters needed, as the Prime Minister expressed it, to patch up the legislation.

As an aside, the amending Determination which caused the Committee to raise the issue was validly tabled. Its practical effect, however, was little or none, because its only substantive provisions purported to amend the earlier invalid Determination. It is ironic, and this is an ethical context, that the Explanatory Statement for the ineffective second Determination advised that its purpose was to address what it termed "problems", "uncertainty", "difficulties" and an "unintentional result" in the invalid original Determination.

As foreshadowed by the Prime Minister a fresh Determination was then made, gazetted and tabled all on the same day, which showed an alacrity not usually noticeable in the actions of the executive relating to delegated legislation. That fresh Determination, however, could operate legally only from that date and could not validate any action taken in putative reliance on the two earlier Determinations. Any such action taken during that two year period was, of course, totally void. The Committee therefore wrote to the Minister for Aboriginal Affairs about the practical effects of the invalidity and of the steps proposed to remedy the situation. The Committee noted in its letter to the Minister that the invalid Determination provided for mandatory action in specified circumstances by the Commonwealth Minister, the Commonwealth itself, the States and Territories and the Native Title Registrar. One of these circumstances, for instance, was notification by governments of their intention to do a future act, such as grant a mining lease. In response to the Committee's inquiry the Minister advised that there may have been thousands of these actions, each of which was invalid. Another circumstance concerned applications for determinations of native title, in respect of which the Minister advised the Committee that there were hundreds of invalid actions. Another aspect of invalidity related to actions by State and Territory agencies, the Minister advising that there was little likelihood that the range and extent of these could easily, if ever, be ascertained.

The Minister further advised the Committee that, following consultations with the State and Territory governments, proposed amendments of the Native Title Act would include a provision to validate retrospectivity all of these thousands of actions. The Committee in this case did not oppose such an amendment, if only because to do otherwise would result in the considerable financial expenditure of the last two years being wasted and because of the waste of time if the whole process had to start again. The Committee nevertheless normally has substantial reservations about Commonwealth legislation providing for prejudicial retrospectivity. The final outcome here is scarcely a flattering picture of Commonwealth public administration, with thousands of legally void actions being validated years later by prejudicially retrospectivity provisions of a Commonwealth Act. This is an unfortunate result but one which, as I say, could not be avoided without much time and money being wasted.

The ethical question here is to balance what might be termed the ethical high ground against the pragmatic approach. I think that the Committee got the balance right by drawing attention to the legal and administrative inadequacies and deploring them, but not opposing what seems to be the only practical solution to the problem. I note, however, that the Committee drew attention to the difficulty 17 months ago and that the amendments of the enabling Act to correct the original instrument which ceased to have effect more than three and a half years ago have, at the time of the preparation of this paper in early November, still not passed the Parliament.

Declaration of Aboriginal Land under the Aboriginal Land Grant (Jervis Bay Territory) Act 1986

The next two cases concern parliamentary propriety. A Declaration of Aboriginal Land under the Aboriginal Land Grant (Jervis Bay Territory) Act was made on 11 October 1995 under a provision of the enabling Act which commenced on 29 September 1995. That provision required the Minister, if he or she proposed to make a Declaration, to publish a notice of intention in the Gazette before the Declaration was made. Neither the Declaration nor the Explanatory Statement advised that this had been done. In this case the Committee noted that any notice could at the most be only 13 days before the Declaration itself and wrote to the Minister. In reply the Minister advised that the notice of intention and the Declaration were made on the same day with the Declaration coming into effect on gazettal on the next day. In the Minister's words, the Committee could therefore rest assured that the requirements of the Act had been followed.

In this case the Minister may have followed the letter of the Act, but there are some fundamental ethical questions. The Act clearly did not intend for mandatory notice of intention to make a grant of land to be gazetted minutes before, or even simultaneously with, the making of the grant itself. The Act must have contemplated that there would be a reasonable period between notice of intention and the grant. It is a sophism to argue otherwise, or to argue that there are no ethical issues here. It is ironic that the Committee was concerned that the period of notice may only have been 13 days.

Sales Tax Assessment Regulations

Sales Tax Procedure (Old Laws) Regulations

The next case involves retrospective amendments of the Sales Tax Assessment Regulations and the Sales Tax Procedure (Old Laws) Regulations. The Explanatory Statements for these advised that the 12 months retrospectivity was to correct an earlier provision which prescribed the information to be included in an evidentiary certificate used against a person to recover unpaid sales tax, because that earlier provision was inconsistent with the enabling Act. The Committee was concerned at a number of aspects of the Regulations but in particular asked about the use of the evidentiary certificates during the period of retrospectivity. The Minister advised that six such certificates had been issued, none of which complied with the Regulations in force at the time, and that the Australian Government Solicitor, who acts for the Australian Taxation Office in these matters, had advised that the legislation was disregarded because of uncertainty about what it meant and the perceived inconsistency.

This case raises a number of ethical issues. The first is that the taxation office disregarded express provisions of Regulations in relation to proceedings to recover money allegedly due. The reasons given by the Minister for these actions are that the tax officials could not understand the legislation and, in any event, thought that it was invalid. On one level this may have some ethical validity but it leads to the question of why action to correct the matter was not taken earlier.

Approved Occupational Clothing Guidelines

The last case which I will describe relates to the Approved Occupational Clothing Guidelines, made under everybody's favourite Act, the Income Tax Assessment Act. The Guidelines, which affect large numbers of Australian wage and salary earners and which also have an effect on the national revenue, were made under a provision of that Act which provided that expenditure incurred by an employee in relation to non-compulsory uniform or wardrobe was not tax deductible unless the clothing was entered on a Register. The provisions also required the Minister to formulate Guidelines setting out criteria for the entry of clothes on the Register. The Guidelines in question consisted of 57 consecutively numbered clauses, some of which were in italics and some not in italics and some in both italics and non-italics. Some of the clauses were also partly in bold and some partly underlined. A helpful note, however, advised that the material in italics was explanatory only and did not form part of the Guidelines.

The Committee was concerned, however, about possible invalid prejudicial retrospectivity. The Guidelines were made on 7 June 1995 and one of the clauses, admittedly in italics, advised that they superseded the previous Guidelines with effect from that date. If this was the case and the new Guidelines were prejudicial then they would be void under the Acts Interpretation Act because the new ones were not gazetted until two weeks later, on 21 June 1995. The position was complicated further by advice in the Explanatory Statement which appeared to be that the old Guidelines were in force up until 30 June 1995.

The Committee wrote to the Minister who advised that most of the new Guidelines were more generous to taxpayers than the old ones, although there were some areas where they were more strict. The Minister further advised, however, that the officials who administered the Guidelines did not reject any applications dated between 7 and 21 June 1995 which would have satisfied the original Guidelines but not the new ones. Also, any application between those two dates which would have satisfied the new Guidelines but not the old would also be approved. The Committee noted that the result appeared to be that no person was actually disadvantaged because for two weeks in the last month of the financial year the authorities administered both the old and new Guidelines simultaneously, applying the relevant beneficial provisions of both Guidelines while ignoring the detrimental provisions.

This case presents interesting ethical questions, but the tax office probably got it right. There were clearly problems with the validity of the new Guidelines but to reactivate the old ones would have perpetuated old detrimental provisions without providing for the new exemptions. Also, the end of the financial year had gone and people were submitting their returns. There is still the ethical problem that the authorities did not administer the law as it existed but rather applied it in a creative way which seemed to be the fairest to them. In any event, the view of the Committee, with its tongue firmly in its cheek, is that any action by the tax office which expands available concessions, whether lawfully or not, is highly ethical.

I have outlined these few cases to illustrate aspects of the impact of the Committee on ethics and administrative law. In two of the cases the Committee had to struggle to impose ethical standards on the judges of the Industrial Relations Court and on officials of the Attorney-General's Department. On the other hand, in the case of the invalid native title Determination the Department of the Prime Minister and Cabinet accepted from the outset that there was a problem which had to be addressed, while the other cases did not of their nature require remedial action although they raised ethical issues. I would, however, emphasise that these are only instances of the hundreds of pieces of correspondence which the Committee sends and receives each year. All of these address some aspect of personal rights and parliamentary propriety and as such all include an ethical component, because delegated legislation which breaches either of these standards has ethical problems. The impact of the Committee on ethics and administrative law is not a series of isolated cases but is a continuing unified process by a body central to Commonwealth administrative law and which has engaged in scrutiny of official action for decades longer than other bodies more often identified with such law. The overriding concern is to meet the intrinsic moral obligations of our terms of reference, and we look forward to continuing to do this for many years to come.

Senator CALVERT —I move:

That the Senate take note of the document.

I seek leave to continue my remarks later.

Leave granted; debate adjourned.