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Focus: Federal response to Hawke EPBC Act review

1 September 2011

In brief: The Federal Government has released its formal response to the independent review of the Environment Protection and Biodiversity Conservation Act 1999 (Cth). While the review's recommendation to replace the current Act and start afresh was rejected, the Government has accepted the majority of its recommendations. Special Counsel Robyn Glindemann (view CV) and Lawyers Robert Merriam and Michael Zissis report.

• Background
• Federal response
• Changes to the environmental impact assessment provisions
• New matters of national environmental significance
• Climate change
• Powers and discretion of the Environment Minister
• Public participation
• Other changes
• Conclusion

Background

In October 2008, an independent review of the EPBC Act was commissioned. The review, led by Dr Allan Hawke, assessed the EPBC Act's operation and the extent to which its objects had been achieved. The review delivered its final report¹ to the Federal Environment Minister in October 2009. On 24 August 2011, the Federal Government released its formal response to the review.²

Federal response

In accepting 56 of the report's 71 recommendations either in full or in part, the Federal Government has flagged its intention to substantially amend the EPBC Act in several areas. The Government was not prepared to scrap the whole Act and replace it with a new, simplified Australian Environment Act, as the report's first recommendation suggested.

Changes to the environmental impact assessment provisions

The response states that environmental impact assessment processes under the EPBC Act are to be made more efficient, through:

• greater use of strategic assessments (which assess the impacts of actions under a broad policy, plan or program, dispensing with the need for discrete actions to be assessed on a case-by-case basis) and regional environment planning (which will focus on identifying sustainable land uses in particular geographical areas); and
• accreditation of a greater range of state and territory processes.³

A cross-jurisdictional working group, which was created at the COAG meeting on 19 August, will develop, and provide COAG with, a suite of options for regulatory reform by the end of 2011, and with a completed reform agenda and detailed implementation arrangements for COAG's approval in early 2012.

The response also shows that the Federal Government plans to:

• encourage pre-referral discussions to help guide proponents;
• continue to develop guidelines to assist proponents in deciding whether an action is likely to have a significant impact on protected matters;
• create binding determinations as to particular classes of action that will or will not have a significant impact on protected matters (again, to assist proponents in deciding impacts for themselves);
• clarify 'particular manner' requirements to make non-compliance more detectable;
• create the ability to form joint assessment panels with state or territory government counterparts;⁴ and
• delete the 'assessment by public environment report' level, as it is too similar to the 'assessment by environmental impact statement' level of assessment, and create a new 'approval on referral information' level that will allow for the issue of a final approval under the EPBC Act within 35 business days for projects that meet specific criteria.⁵

The response noted community concern about the quality of work of some consultants involved in environmental impact assessments under the EPBC Act. The Government decided that a code of conduct for consultants was not currently warranted, though it may be in the future. Industry-level certification schemes and voluntary codes of conduct already exist in Australia (eg the Environment Institute of Australia and New Zealand's Certified Environmental Practitioner Program).⁶

While no mandatory code of conduct is proposed at this time, the Government agreed to more comprehensive auditing of the quality and accuracy of information supplied as part of environmental assessments.

New matters of national environmental significance

The Government has agreed that 'ecosystems of national significance' and 'vulnerable ecological communities' will be added to the list of matters of national environmental significance under the EPBC Act. The response states that the first of these additions will:

• allow the cumulative impact of threats to ecosystems to be better addressed, 'through a whole-of-ecosystem approach'; and
• secure the protection of listed ecosystems before they fall into decline.⁷

The second addition seeks to afford the same level of protection under the EPBC Act to vulnerable ecological communities as to vulnerable species.⁸

Climate change

The report was released shortly after the Rudd Government's Carbon Pollution Reduction Scheme (the CPRS) was first voted down in the Senate. In this context, and with emissions information becoming increasingly available through reporting under the National Greenhouse and Energy Reporting Act 2007 (Cth), the report:

• recommended an interim greenhouse trigger be introduced to the EPBC Act as soon as possible by way of regulation, to sunset upon the commencement of the CPRS; and
• suggested a trigger threshold of no higher than 500,000 tonnes of carbon dioxide equivalent domestic emissions in any 12-month period over the life of a project or activity.

The present Government has rejected the recommended interim greenhouse trigger, as being unlikely to 'materially influence the emissions associated with decisions taken on projects during the period over which [it] might operate'. The response refers to the Government's commitment to introduce a carbon price, as contained in the Clean Energy Future package released in July, 'as a central element of its strategy to reduce Australia's national greenhouse gas emissions'.⁹

As a complementary measure to the carbon price, the Government has introduced the Carbon Farming Initiative (the CFI), which allows permits to be issued to eligible reforestation projects, to then be sold in the voluntary market or to entities seeking to offset their carbon emissions.

The CPRS proposal included a similar measure, however, the report noted that the mechanism 'could potentially create a perverse incentive to clear non-forest native vegetation' and recommended 'implementing additional protection for non-forest native vegetation through the eligibility requirements for reforestation projects'.

The Government has agreed with the recommendation, and states the CFI 'should provide greater protection for nonforest native vegetation than was afforded under the proposed CPRS'¹⁰ because it:

• recognises a broader range of land use and management activities as eligible carbon offset projects, including non-forest vegetation projects and managing remnant or existing stands;
• requires projects to have obtained all regulatory approvals and met regulatory requirements from all levels of government before they receive final approval; and
• disallows abatement projects that involve, or make use of material derived from, the destruction of native forests, such as projects involving the conversion of native forests into biochar. The Government will provide a 'negative list' of abatement activities with a high potential for adverse social, agricultural or environmental outcomes that will be ineligible for CFI credits to support the scheme.¹¹

Powers and discretion of the Environment Minister

The Federal Government declined to confer power on the Environment Minister to consider the environment broadly in making approval decisions. The response commented that, in broad terms, states and territories are responsible for regulating the environment generally, while it is the Commonwealth's role to protect particular matters of national significance.¹²

However, the Environment Minister is to be given a more expansive discretion to undertake audits of compliance with legislation and environmental outcomes and performance.¹³

It is proposed that the Environment Minister's power to force proponents to consider prudent and feasible alternatives for projects in the early stages of the assessment process be clarified. The response commented that this early consideration of alternatives will help avoid situations in which a project is:

• unnecessarily killed off at an early stage for being 'clearly unacceptable'; or
• allowed to proceed, despite the minister knowing that his or her final decision may be not to approve it.¹⁴

The Government has declined to amend the existing criteria for the Environment Minister's decision-making under the EPBC Act, noting that the desired effects of the report's recommendations in this regard are already achieved through administrative law and principles of ecologically sustainable development (which form the basis for all decisions under the EPBC Act).¹⁵

Public participation

The response proposes several measures to increase public participation in decision-making under the EPBC Act. More information is to be provided to the public, including:

• various expert reports and advices used in the decision-making process; and
• all comments received through public consultation processes of the EPBC Act (excluding 'campaign letters' and confidential or private documents).¹⁶

The Environment Minister will have the discretion to seek public comment on draft environmental management plans, and to specify how public consultation will occur in relation to regional environment plans, provided minimum consultation standards are met.¹⁷

The report encouraged public participation through recommendations that would have facilitated public interest litigation. The Federal Government broadly declined these recommendations, deciding not to:

• do away with the Federal Court's discretion to require a public interest applicant to provide an undertaking as to damages as a condition of granting an interim injunction;
• prohibit the ordering of security for costs in public interest proceedings; and
• do away with the court's existing broad discretion as to costs orders, and impose a special 'public interests costs order'. ¹⁸
  

Other changes

The Secretary of the Department of Sustainability, Environment, Water, Population and Communities is to be given the power to issue environment protection orders. These orders will direct a person whose actions are in breach of the EPBC Act to cease or change that action so as to avoid or minimise environmental harm. This is in addition to the existing power under which a person can be ordered to remedy (rather than cease) environmental harm.¹⁹

The response also contains a wide range of proposed reforms relating to threatened species, including better co-ordination and management of species lists, threat abatement plans and management plans.

Conclusion

While the response does not propose any large-scale radical changes to the federal regime, it does foreshadow some significant changes to the EPBC Act, as well as a large amount of cross-jurisdictional consultation and work to be done to deliver an improved regulatory framework. Project proponents will therefore need to maintain a watching brief of both the federal and state and territory developments, to consider how these changes will impact new projects or amendments to existing ones.

Footnotes

1. Allan Hawke, Report of the Independent review of the Environment Protection and Biodiversity Conservation Act 1999: Final Report, October 2009. The report is available from the Department of Sustainability, Environment, Water, Population and Communities website, through the 'EPBC Act' page.
2. Department of Sustainability, Environment, Water, Population and Communities, Australian Government Response to the Report of the Independent Review of the Environment Protection and Biodiversity Conservation Act 1999, August 2011. The response is available from the Department of Sustainability, Environment, Water, Population and Communities website, through the 'EPBC Act' page.
3. Ibid, pp 10-12, 15-22.
4. The response notes that, as amendments to state and territory legislation might be required to implement this proposal, it would initiate discussions with state and territory agencies to investigate the best method of progressing it.
5. Department of Sustainability, Environment, Water, Population and Communities, Australian Government Response to the Report of the Independent Review of the Environment Protection and Biodiversity Conservation Act 1999, August 2011, pp 52-57.
6. Ibid, pp 47-48.
7. Ibid, pp 23-25.
8. Ibid, p 33.
9. Ibid, p 27.
10. Ibid, p 28.
11. Ibid, pp 28-29.
12. Ibid, p 49.
13. Ibid, p 101.
14. Ibid, p 50-51.
15. Ibid, pp 78-79.
16. Ibid, pp 80-82.
17. Ibid, pp 83-84.
18. Ibid, pp 91-93.
19. Ibid, p 98.

For further information, please contact:

• Robyn GlindemannSpecial Counsel, Perth
  Ph: +61 8 9488 3712
  Robyn.Glindemann@allens.com.au
• Paul LalichPartner, Sydney
  Ph: +61 2 9230 4026
  Paul.Lalich@allens.com.au
• Bill McCrediePartner, Brisbane
  Ph: +61 7 3334 3049
  Bill.McCredie@allens.com.au
• Chris SchulzPartner, Melbourne
  Ph: +61 3 9613 8772
  Chris.Schulz@allens.com.au
• Jim ParkerPartner, Sydney
  Ph: +61 2 9230 4362
  Jim.Parker@allens.com.au