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National Environment Protection Council Bill 1994



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House: Senate

Portfolio: Environment, Sports and Territories.

Commencement: On a day to be fixed by Proclamation.

Purpose

The Bill establishes the National Environmental Protection Council (NEPC) pursuant to the Intergovernmental Agreement on the Environment (IGAE) signed by the Commonwealth Government, all State and Territory Governments and the President of the Local Government Association in 1992, and establishes the Council's functions and powers.

Background

The Commonwealth has no express power under the Constitution in relation to the environment. Commonwealth policy making has however turned increasingly to environmental matters in the past 20 years, and the Commonwealth has sought to use other heads of power under section 51 of the Constitution to achieve particular environmentally related policy outcomes. This approach contrasts with the previous co- operative approach which relied on intergovernmental agreements with the States, complemented by mirror legislation across all jurisdictions.

Over this period, the external affairs power 1 has been used to claim sovereignty over the continental shelf 2 , sand mining on Fraser Island 3 has been prevented by the use of the trade and commerce power 4 , and rainforest in Queensland and wilderness in Tasmania has been preserved using legislation relying on the external affairs power 5 to implemen international Treaty obligations. Financial provisions in the Constitution such as section 96 which allows the Commonwealth to grant financial assistance to the States on any terms it thinks fit 6 are also reliable means to ensure State compliance with Commonwealth environmental policies. D. Fisher has commented that:

It has however been the provision of financial assistance to the States by the Commonwealth in the context of section 96 of the Constitution that has so far been most influential in the promotion of environmental management consistent with the policies of the Commonwealth. 7

Other powers of taxation 8 , the ability to grant bounties 9 and the power of appropriation 10 can also be used as economic levers to further Commonwealth environmental policies. 11

Over the last 20 years, increased Commonwealth involvement has also been reflected in a number of legislative initiatives including the Environment Protection (Impact of Proposals) Act 1974 (C'th), the National Parks and Wildlife Conservation Act 1975 (C'th), the Environment Protection (Nuclear Codes) Act 1978 (C'th), the Nuclear Non- Proliferation (Safeguards) Act 1987 (C'th) and the World Heritage Properties Conservation Act 1983 (C'th). This involvement was in part due to the rising political importance of green lobby groups and the increasing need to provide for ecologically sound economic growth. Fisher comments:

..the Commonwealth has taken positive steps to apply the policy of ecologically sustainable development in the relevant range of resource industries. These examples are indicative of a commitment by the Commonwealth to the use of its powers, where appropriate, to protect the environment and conserve the natural resources of the environment. To some extent, this represents a movement away from the traditional co- operative federalism approach... towards a more positive and direct role for the Commonwealth. 12

Intergovernmental Agreement on the Environment.

At the Special Premiers' Conference in Brisbane on 30 October 1990, the question of implementation of a national environment strategy involving both the Commonwealth and the States was discussed. It was resolved that:

In order to avoid conflicts there is a need for a new approach which recognises the national and/or international aspects of environmental decision making but which also recognises the roles of the States and Territories. Central to this is the better definition of the respective roles of the Commonwealth and the States and Territories with regard to environment policy formulation and implementation. 13

It was acknowledged that all levels of government have different roles in environmental protection and management, and that any agreement should outline respective roles and responsibilities 14 . It was also agreed that:

A formal intergovernmental agreement, setting out in broad terms the agreed roles of the various levels of government, would provide a mechanism for defining respective interests and responsibilities, and for developing and implementing environment policy accordingly. 15

An Intergovernmental Agreement on the Environment (IGAE) was signed by the Commonwealth, the States and Territories and the Local Government Association, on 1 May 1992 and is contained in the Schedule to the Bill. This agreement seeks to ensure a comprehensive coverage of a number of environmental issues, which would probably be beyond the Commonwealth's constitutional powers. The then Minister for the Environment, the Hon. Ros Kelly, was however reported to have suggested that if the agreement proved to be ineffective, then the Commonwealth might have to look at some form of constitutional amendment to achieve its aims 16 .

The IGAE is to provide a mechanism to facilitate:

a co- operative national approach to the environment;

a better definition of the roles of respective governments;

a reduction in the number of disputes between the Commonwealth and the States and Territories on environment issues;

greater certainty of Government and business decision making; and

better environment protection. 17

The IGAE also acknowledges the role of the respective tiers of government, recognises the transboundary nature of environmental concerns, the need for ecologically sustainable development and the importance of sustainable land use 18 .

The responsibilities of the respective levels of government are set out in Clauses 2.1 to 2.4 of the IGAE, while accommodation of conflicting interests is dealt with under Clauses 2.5.1 to 2.5.6 of the IGAE.

Clause 3 of the IGAE sets out broad principles of environmental policy to be used as guidance by governments including:

the precautionary principle, being broadly the careful consideration of the possibility of serious or irreversible environmental damage;

the preservation of intergenerational equity, namely the maintenance of the environment for future generations;

conservation of biological diversity and ecological integrity; and

improved market mechanisms encompassing the consideration of environmental costs, the principle of polluter pays and the establishment of cost effective environmental goals.

The Schedules to the Agreement set out the obligations of the various levels of government in particular environmental areas. The Schedules deal with data collection, resource assessment and land use, environmental impact assessment, national environment protection measures, climate change, biological diversity, the national estate, world heritage, and nature conservation respectively. The Bill seeks to implement the responsibility to establish National Environment Protection Measures outlined in Schedule 4 of the IGAE. Clause 2 of Schedule 4 obliges the Commonwealth and the States to set up a Ministerial Council, to be called the National Environment Protection Authority (NEPA). The Authority's powers and process are set out in Clause 5 of Schedule 4, and it will be responsible for the publication, dissemination, monitoring and reporting on the implementation and effectiveness of National Environment Protection Measures (NEPMs). These NEPMs will be established in the areas of:

(i) ambient air quality;

(ii) ambient marine, estuarine, and freshwater quality;

(iii) noise related to protecting amenity where variations in measures would have an adverse effect on national markets for goods and services;

(iv) general guidelines for the assessment of site contamination;

(v) the environmental impacts associated with hazardous wastes;

(vi) motor vehicle emissions; and

(vii) the reuse and recycling of materials.

Clause 15 of Schedule 4 of the IGAE makes NEPMs disallowable by either House of the Commonwealth Parliament and enforcement of NEPMs is to be achieved through appropriate mechanisms, such as State and Commonwealth Environment Protection Authorities by virtue of clause 17 of Schedule 5. The Schedule also obliges the States and the Commonwealth to draft legislation allowing NEPA to establish NEPMs and to ensure enforcement of NEPMs in the States 19 . Once implemented, clause 18 obliges the parties to establish a uniform hierarchy of penalty structures for non- compliance with laws enforcing NEPMs.

The Agreement specifically provides that States may impose more stringent standards than those prevailing under NEPMs if they wish, thereby seeking to create minimum uniform standards across the country.

The role of NEPA is to be complementary to that of the Commonwealth Environment Protection Authority (CEPA), whose functions are to provide:

...a firm base of knowledge of the state of the environment, improve the management and protection of the environment, and promote community education and information about environment protection. 20

(CEPA has no legislative backing and is simply a part of the Commonwealth Department of the Environment, Sport and Territories. It has a facilitative and educative role, rather than a coercive role. Its priorities include promoting waste minimisation and recycling, strengthening the reporting on the state of the Australian environment, streamlining and improving environment impact assessment across the country, promoting new pollution reducing technology and publicising solutions to urban environmental problems 21 ).

The Bill establishes the National Environmental Protection Council in accordance with Clause 2 of Schedule 4, but it is to be called the National Environmental Protection Council (NEPC), rather than the National Environment Protection Authority (NEPA) as described in the IGAE.

Having some concerns that the States may try to play politics with the environment, the Australian Conservation Foundation (ACF) has been cautious on the establishment of NEPC 22 . This concern has been borne out to some extent by Western Australia's opposition to NEPC, and its apparent reneging on the IGAE. In the Second Reading Speech to the Bill, the Minister for the Environment, Sport and Territories, Senator the Hon. John Faulkner confirmed WA's opposition. Although the Bill was described by the Minister as:

...an important landmark in the history of environment protection. It marks the commitment of the Commonwealth and the States and Territories to work cooperatively to develop national environment protection measures. These measures aim to give all Australians the benefit of equivalent environmental protection and to ensure that investment decisions by business are not distorted by variations in environmental standards between Australian jurisdictions. 23

he also stated that WA would not be participating at this stage 24 .

In May 1994, the WA Minister for the Environment, the Hon. Kevin Minson, issued a paper entitled "The Proposed National Environment Protection Council (NEPC) Analysis and Criticism of the Concept by the Government of Western Australia", which puts forward the WA case for withdrawing from the IGAE. In the foreword to the paper, the Minister attacked the NEPC stating that:

There is no evidence that NEPC will improve environmental protection, environmental management or sustainable development in Australia. This lack of documentation in itself should cause doubts about the value of creating NEPC....The NEPC proposal is symptomatic of ever- increasing Commonwealth intrusions into environmental issues on which it often has little expertise or practical experience...NEPC goes far beyond political concerns about States' jurisdiction and Commonwealth roles. NEPC could jeopardise efficient protection of the environment, most immediately confusing water quality strategies. Its complex and new powers and processes would bring new frustrations and uncertainties to investors and other Ministerial Councils. It is unnecessary and harmful. 25

The paper argues that NEPC is unnecessary because:

NEPC would require State Parliaments to forfeit their powers to disallow regulations, while allowing the Commonwealth to retain such powers in the area of pollution standards;

Uniform national pollution standards are impracticable because of the wide variety of Australian environments and their uses;

NEPC would reduce competitiveness by introducing another layer of centralised regulation;

NEPC would tie up resources of pollution control agencies 26 .

The paper states numerous times that arguments in favour of NEPA are not documented 27 .

An adviser to Mr Minson, Dr Brian O'Brien has previously written on the "nationalisation" of the Australian environment through the use of NEPC, IGAE and other intergovernmental agreements. In a paper entitled, "Introductory Notes on Nationalisation of the Environment: The Agreements of '92.", Dr O'Brien was critical of a number of environmental agreements and initiatives undertaken by the Federal Government mainly in 1992. In concluding, he states:

The Agreements of '92 avoided visionary but logical strategies, and were unbalanced towards the importance of the environment, away from both humanity and the economy. Balance and less intervention and moralising by governments are essential if growth is to be forceful. 28

The paper recommended, amongst other things that:

moves to establish NEPA be stopped;

pending a review of the National Greenhouse Response Strategy, the United Nations Convention on Climate Change should not be ratified by Australia;

The UN Convention on Biological Diversity 29 should not be ratified by Australia until there is another round of public scrutiny of a draft national strategy for conservation of Australia's biological diversity; and

national strategies in conservation matters should not be finalised until CEPA has demonstrated that nationalisation of environmental issues actually brings increased efficiency in both environmental and economic matters 30 .

The paper issued by Mr Minson was forwarded to CEPA who responded to the issues raised by the WA Government. In its response, CEPA emphasised the fact that not only do national schemes always involve a degree of power sharing, but that as ASEAN countries:

...having agreed upon environment protection standards, have realised that high environmental standards are needed in order to compete internationally. Western Australia must also come to this realisation. 31

In particular, CEPA pointed out that:

When making NEPMs, NEPC will be required to take into account regional variations, and that NEPC will not aim for strict uniformity, but rather a consistent approach to environmental protection;

NEPC will be administratively efficient, since its Secretariat will be 9 or less, and sharing of State expertise regarding environmental problems will avoid duplication; and

States with higher standards than those set by NEPC will have the flexibility to retain those standards, thus making NEPC a body seeking overall higher environmental standards. States with such higher standards will push for comparable national standards to avoid competitive disadvantage.

Main Provisions

Part 2 of the Bill relates to the establishment of NEPC. Clause 7 states that the Commonwealth will implement NEPMs in respect of activities that are subject to Commonwealth law. Failure to do so attracts no sanctions. Clause 8 establishes NEPC, while clause 9 outlines its membership. The Council is to consist of a Minister of each participating State and Territory, nominated by the Premier or Chief Minister of that State or Territory, and a Commonwealth Minister nominated by the Prime Minister. Clause 10 makes the Commonwealth Minister the Chairperson of the Council.

Part 3 deals with the functions and powers of NEPC. Clause 12 States that the functions of NEPC are to make NEPMs in accordance with Division 2, and to report on the implementation and effectiveness of NEPMs in the various jurisdictions. Clause 13 outlines the more specific powers of NEPC. These powers include the power to consult, undertake research, publish reports, disseminate information to the public and obtain advice. Division 2 allows NEPC to make NEPMs. Clause 14 lists the areas over which NEPMs can be made, which are the areas specified in the IGAE and discussed above (ambient air quality etc.) A proviso is made for NEPMs concerning motor vehicle noise and emissions under sub- clause 14(2) which states that NEPMs in these areas must be agreed to by the National Road Transport Commission and be determined in accordance with the National Road Transport Commission Act 1991 and the Motor Vehicle Standards Act 1989, where appropriate. Sub- clause 14(3) states that a NEPM must consist of at least 1 of:

(i) a national environment protection standard, defined in clause 6 to be a standard consisting of quantifiable characteristics of the environment against which environmental quality can be assessed;

(ii) a national environment protection goal, defined in clause 6 to be a goal relating to desired environmental outcomes that guides the formulation of human strategies for the management of human activities that may affect the environment;

(iii) a national environment protection guideline, defined in clause 6 to be a guideline which gives guidance on possible means for achieving desired environmental outcomes;

(iv) a national environment protection protocol, defined in clause 6 to be a protocol which relates to the process to be followed in measuring environmental characteristics to determine whether a particular standard or goal is being achieved or the extent of the difference between the measured characteristic of the environment and a particular standard or goal.

Clause 15 states that NEPC must take into account a number of factors when making a NEPM including its cost effectiveness, its social and economic impacts, and any other existing international treaties or intergovernmental mechanisms.

Clause 16 obliges NEPC to publish a notice in the Gazette and a national newspaper before drafting a NEPM, and once drafted, clause 17 ensures that an impact statement for the NEPM must also be prepared. Clauses 18 and 19 require NEPC to consult publicly, and to take account of any submissions received or advice received from the NEPC committee. Under clause 21, NEPMs are disallowable instruments. The Council must produce an annual report every year, by virtue of clause 24.

Part 4 of the Bill sets out the procedural operations of NEPC. Clause 27 provides that a quorum of a meeting is at least 2/3 of the members (6 members, even if WA is excluded), while clause 28 requires a decision of NEPC to be supported by 2/3 of the members, whether present or not. Division 2 of Part 4 allows a sub- committee to be formed, to assist the Council in its operation.

The remainder of the Bill establishes administrative infrastructure to ensure adequate functioning of NEPC.

Comment

The former Minister for the Environment, Sport and Territories, the Hon. Ros Kelly stated in a speech in 1993 that the emphasis will be on harmonised national measures, rather than uniform national measures, since the measures will need to be implemented differently in each State and Territory. Standards will in most cases not be uniform, with the exception of offences and penalty structures. Although there may well be legitimate concerns about different physical and geographic features across the States which may lead to differing standards, the States are given significant independence as to how NEPMs are implemented at the State level, and every State is represented on NEPC. In this respect, the attitude of WA is somewhat surprising, and highlights again the practical difficulties of co- operative Federalism. Although intergovernmental agreements are notionally a rational and practical solution to the constitutional limitations of particular governments in particular subject areas, they suffer from a basic enforceability and accountability problems, and are effectively only statements of government policy. The High Court is loath to enforce such agreements, on occasion finding them non- justiciable, or as giving rise to political rather than legal obligations 32 . Furthermore, any remedy given by the High Court would, of itself encounter enforcement difficulties. The most useful tool on the part of the Commonwealth if it wishes to enforce the IGAE against WA would be to threaten to withdraw general funding grants under section 96 of the Constitution, instead of legislating to cover the environmental area itself. Often, raw economic muscle will prevail over legal might, especially when the extent of the Commonwealth's power in the area is still unclear.

Endnotes

1 Constitution, section 51(xxix).

2 NSW v Commonwealth; Seas and Submerged Lands Case, (1975) 135 CLR 337.

3 Murphyores v Commonwealth (1976) 136 CLR 1.

4 Constitution, section 51(i).

5 Queensland v Commonwealth (1989) 167 CLR 232, Commonwealth v Tasmania (1983) 158 CLR 1.

6 Which has been held to include purposes outside Commonwealth power, A- G (Vic); Ex Rel Black v Commonwealth (1981) 146 CLR 559.

7 Fisher, D., Environmental Law, Law Book Company, Sydney, 1993, p 73, see also Crawford, J., "The Constitution and the Environment", Sydney Law Review,(1991) Vol. 13, p 11.

8 Constitution, section 51(ii).

9 Constitution, section 51(iii).

10 Constitution, section 81.

11 See Fisher, ibid, generally Chapter 2.

12 Ibid, p 49.

13 Commonwealth paper, "Environment Policy", Special Premiers' Conference, Brisbane, 30- 31 October 1990.

14 Ibid, p 3.

15 Ibid.

16 Garran, R, "Kelly hints at 'green' Constitution change", Australian Financial Review, 10 April 1992.

17 Preamble to the Agreement.

18 Ibid.

19 Clause 16 of Schedule 5 to the Agreement.

20 Dept of Environment, Sports and Territories, Annual Report 1992- 93, p 34.

21 McPhail, Dr I, Executive Director, CEPA, "The Role of CEPA and NEPA", Australian Environmental Law News, No.2, June 1992, p 66- 68, at p 67.

22 "ACF cautious on new green body", The Age, 9 February 1994.

23 Second Reading Speech

24 Ibid.

25 Foreword, "The Proposed National Environment Protection Council (NEPC) Analysis and Criticism of the Concept by the Government of Western Australia", Federalism and the Environment, Thought Starter Paper No. 1, May 1994.

26 Ibid, summary, p 1.

27 For example, ibid, p 18 and p 10.

28 O'Brien, B, "Introductory Notes on Nationalisation of the Environment: The Agreements of '92.", Institute of Public Affairs, April 1993, p 9.

29 This convention was ratified on 20 June 1993.

30 Ibid, p 10.

31 Statement provided by CEPA, 17 Jun 1994.

32 See for example South Australia v Commonwealth; The Railway Standardisation Case, (1962- 63) 108 CLR 130.

Marco Bini Ph. 06 277 2476

Bills Digest Service 15 June 1994

Parliamentary Research Service

This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1994.