Productivity Commission focuses on red tape, and resources sector growth

By Igor Bogdanich, Tracey Greenaway, Emily Johnstone
Mining Oil & Gas

In brief 2 min read

The Productivity Commission is examining resources sector regulation, with a focus on identifying opportunities to simplify approval processes without compromising environmental standards or community expectations. With public consultation complete and submissions now published online, the Commission is preparing its draft report for release in March 2020.

Key takeaways

  • The Inquiry forms part of the Federal Government's 'red tape reduction' push. It is running concurrently with work by other agencies, including the statutory review into the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (the EPBC Act) and the Government's Deregulation Taskforce, aimed at reducing regulatory impediments to investment, and fast-tracking major infrastructure projects.
  • Development, legal and government relations teams should keep track of the Inquiry, and note opportunities for participation in public hearings in mid-2020, once the draft report is released.

Themes emerging from public feedback

The Commission's study is focusing on identifying best practice examples of regulations that streamline assessment and approvals processes, provide transparency for proponents and the community, and reduce complexity and duplication that might stifle investment.

Assessment and approval processes

A common theme in the submissions was that multi-layered approval requirements and parallel assessment processes are causing significant delays, particularly where assessment processes and roles are duplicated across government agencies. The submissions note a number of opportunities for improvement, including:

  • expanding the use of central coordinating agencies to manage assessment processes;
  • introducing streamlining mechanisms for assessment processes, including the option for proponents to select a single regulator to assess certain projects;
  • expanding the use of bilateral agreements (such as those provided for under the EPBC Act) to accredit a broader range of state and territory assessment frameworks and processes under federal legislation;
  • moving away from prescriptive reporting requirements, to risk and outcome focused reporting (with appropriate third party verification and audit processes), to reduce compliance burdens on both industry and regulators; and
  • clarifying regulator accountabilities, deliverables and statutory deadlines for decision making, to reduce the scope for delays.

Submissions also raised concerns about regulator delays in post-approval processes, and identified constraints on capacity and resourcing as limiting regulatory agencies fulfilling their legislative roles. The submissions also mention a 'rising tide' of approval conditions, which may not be appropriate for all projects, nor reflect the recommendations of technical assessments. It was noted that model conditions can be a useful guide, but are rarely fit for purpose for individual projects.

Other (non-regulatory) issues and opportunities

The Inquiry is also examining issues and opportunities outside of resources regulations that influence investment. A broad range of issues has been raised, including uncertainty regarding federal and state climate policies, delays in assessments for Foreign Investment Review Board approval, approval delays for complementary infrastructure such as railway lines, and skills shortages in remote areas. Submissions note opportunities to create a supportive regulatory environment that supports fast-tracked development of technologies, with the dual benefits of increasing competition in the sector while reducing environmental impacts.

Actions you can take now

  • Read the Issues Paper and public submissions.
  • Consider making a submission when the draft Inquiry report is released in March 2020.
  • For projects requiring assessment and approval under the EPBC Act, consider making a submission to the Independent Review before 14 February 2020.