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Wednesday, 29 June 1994
Page: 2220

Senator COLSTON —by leave—On behalf of the Senate Standing Committee on Regulations and Ordinances, I make a special statement on the Territory of Christmas Island Casino Control Ordinance 1988. The Territory of Christmas Island Casino Control Ordinance 1988 was made under the Christmas Island Act 1958 by the Governor-General on 22 September 1988 and

was scrutinised by the committee in the usual way. This scrutiny revealed a number of apparent defects which the minister undertook to remove by amending the ordinance.

  One of these defects was lack of provision for parliamentary scrutiny and control of procedures under which the casino licence was to be granted. In the case of this particular ordinance, the committee accepted that it was necessary for the eventual grant of the licence to be tabled in both houses only, rather than to be subject to both tabling and possible disallowance.

  The reason for this is that, as the establishment of a casino would have considerable commercial implications for a private sector organisation, it was considered sufficient for parliament to be informed about the grant of the licence but not have the licence subject to disallowance. On the other hand, the committee considered that parliament should be in ultimate control of the procedures leading to the grant. In a matter as important and sensitive as the grant of a casino licence in an area for which the Commonwealth government has responsibility, parliamentary supervision of the processes leading to the grant would be more likely to ensure that appropriate safeguards are initiated before a commercial agreement actually came into force.

  Accordingly, the committee accepted the undertaking of the minister of 23 November 1988 to amend the ordinance to provide, among other changes to satisfy the committee, that no fewer than 12 procedural requirements should be subject to tabling and possible disallowance. These procedures included those leading to the grant or assignment of a casino licence, the lease of the casino or its associated resort hotel, agreements between the developer and the operator, certain contracts for the supply of goods and services to the casino, licences for employees, and exclusion of people from the casino. The minister's undertaking was implemented by the Casino Control (Amendment) Ordinance 1989, ordinance No. 8 of 1989.

  It is worth noting that the relevant disallowance provisions in all these cases were provided for directly by reference to the parent Christmas Island Act 1958, not by applying appropriate provisions of the Acts Interpretation Act 1901 or by making use of the regulation making power in the principal ordinance. The relevant provisions of the Christmas Island Act provide not only for disallowance of legislative instruments, but also for partial disallowance. This is an important safeguard which the committee has argued should be available for all delegated legislation. Unfortunately, the number of series of instruments in respect of which this option may be exercised is at present quite limited.

  On 5 November 1993 the parliamentary secretary, acting for the minister, granted a casino licence under section 53(1) of the ordinance. The instrument was tabled in the Senate on 18 November 1993. The instrument was neither numbered nor accompanied by an explanatory statement. As noted earlier, the grant of a licence under section 53(1) was subject to tabling but not disallowance. Under section 53(2), however, the licence must be in a form approved by the minister, with the actual form being subject to both tabling and disallowance.

  The committee was concerned at a number of aspects of the instrument. The committee accepted that the lack of numbering, although virtually all delegated legislation is numbered, was perhaps understandable as the legislation contemplated only one casino licence for Christmas Island, which was granted for 15 years. The lack of an explanatory statement, however, was an unfortunate defect, as it may have explained the chief concern of the committee. This was that the approved form of the licence had not been tabled as required by section 53(2). This was a disturbing aspect of the administration of the ordinance, as parliamentary scrutiny of the processes leading to the grant of a licence is an important safeguard, expressly included to meet the earlier concerns of the committee.

  Several explanations suggested themselves to the committee. The first was that the failure to table the form of the licence was simply a managerial oversight, which could possibly be cured by future tabling. The second was that, for some reason, tabling of the approved form had been deliberately delayed. The most likely explanation, however, appeared to be that the section 53(2) approval was implied in the section 53(1) grant. In this context, the committee's legal adviser, Emeritus Professor Douglas Whalan AM, advised that the latter position would be both unusual and unsatisfactory.

  The committee therefore wrote to the minister, noting that it had not seen a section 53(2) approval and asking whether one would be tabled, or whether the tabling of the section 53(1) instrument was intended to satisfy the requirements of section 53(2). If tabling the one non-disallowable instrument was also considered to be tabling the other disallowable instrument, the committee asked for urgent confirmation that the one-page tabled instrument was subject to disallowance. If this was not the case, the committee asked for advice on the precise text which was subject to disallowance. Also, if it was not intended to table a separate approved form, the committee asked the minister to arrange for suitably senior officers of the department to attend its next meeting to brief members on the procedural responsibilities imposed by the ordinance. Finally, the committee pointed out that express approvals of other forms had been tabled separately. For instance, approval of the form of an agreement under section 62(2) between Christmas Island Resort Pty Ltd and Casinos Austria International Pty Ltd was tabled. That form correctly indicated that it was a section 62(2) disallowable instrument and not an approval of the agreement under section 62(1), which is subject to tabling but not disallowance.

  The reply to the committee's letter relied on written advice from the Department of the Environment, Sport and Territories and from the Attorney-General's Department. The advice was that the scheme envisaged by the ordinance was that an appropriate form for a casino licence would probably be approved by the minister under section 53(2) before a licence would be granted under section 53(1). In this case, however, a separate form was not approved. Instead, the parliamentary secretary impliedly approved the form of the licence and expressly granted the licence in the same document. The advice was that although the form of the licence was not blank but already filled in, this did not matter because under the ordinance there will normally only be a single licensee. The advice emphasised that the position may well be different if an approved form would be completed by or in respect of many individuals. In this case, however, it was likely that the form of the licence would be different for each consecutive licensee, reflecting the fact that the minister may have particular requirements for each licence.

  The Attorney-General's Department then advised that those parts of the one-page instrument tabled on 18 November 1993 which were part of the approved form were disallowable, while the rest, not part of the form, were not disallowable. Further, if the disallowable parts were actually disallowed, the licence would not thereby cease to be valid.

  The result was that a single, short, one-page document was tabled in the Senate, some of the text of which was disallowable while other text was not. The practicalities of the situation were complicated by the tabled grant of the casino licence consisting of six paragraphs, which were not numbered, each of which contained only one sentence. It appears that some individual words and phrases could be disallowed but not other words and phrases in the same sentence.

  The committee accepted the advice without insisting on the information it had requested in its letter to the minister about the precise text which was disallowable. Instead, it noted that the advice expressly confirmed that the procedures followed were probably not those envisaged when the Governor-General made the ordinance. It also noted the advice of its legal adviser that the present procedures were both unusual and unsatisfactory. The committee believes that future action under the ordinance should take the form that was originally intended and which was in fact used in respect of other aspects of the administration of the ordinance. To do otherwise, as occurred in this case, is to make a mockery of either primary or delegated legislation or both.