One step closer to single-touch environmental approvals under the EPBC Act

Less than a month after the release of the Final Report of the Independent Review of the Environment Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act), the Government has sought to introduce new legislation which would:

1. Establish a framework for the making, variation, revocation and application of National Environmental Standards (Standards); and
2. Establish an Environment Assurance Commissioner to undertake transparent monitoring and auditing of the operation of bilateral agreements with the states and territories, and Commonwealth processes under the EPBC Act for making and enforcing approval decisions.

We previously reported on the key findings and recommendations of the Interim Report and the Final Report, which included both the making of Standards and establishment of the new statutory office of the Environment Assurance Commissioner. On 25 February 2021, when the Environment Protection and Biodiversity Conservation Amendment (Standards and Assurance) Bill 2021 (Bill) was introduced to the Lower House, federal Minister for the Environment, Ms Sussan[JWS1]  Ley, stated that:

“…leaders have agreed that the immediate priority for reform is to implement single-touch environmental approvals, underpinned by national environmental standards that reflect the current requirements of the EPBC Act … to provide oversight and confidence that single touch approvals systems are working as intended, are upholding the requirements of the EPBC Act and are achieving the national environmental standards, the bill also establishes a new, independent, statutory position – the Environment Assurance Commissioner”.

The Standards

Under the proposed reforms to the EPBC Act, the Minister will be empowered to make Standards which set requirements for decision-making to deliver outcomes for the environment and heritage. Such Standards will be applied to decisions nationwide, regardless of the jurisdiction, and will underpin both accredited environmental assessment and approval processes under bilateral agreements, and certain “decisions or things” made or done under the EPBC Act.

In both the Interim and Final Reports, Professor Samuel recommended that Standards be introduced to apply to all aspects of the assessment, approval and post-approval processes under the EPBC Act. Although the Bill seeks to merely implement a statutory framework for the subsequent creation of Standards as legislative instruments, Ms Ley noted in her Second Reading Speech that the Government will be prioritising the development of interim Standards for matters of national environmental significance (MNES) which reflect the existing requirements of the EPBC Act and ensure that the existing rules are clear. From the emphasis in the Second Reading Speech and Explanatory Memorandum on bilateral approval agreements, it is possible that the Minister will then seek to approve bilateral approval agreements across all jurisdictions in line with existing requirements subject to being able to obtain the agreement of each individual state and territory.

As noted by Professor Samuel in the Interim Report, approval bilateral agreements have to date not been implemented due to what he called an “inherently fragile” mechanism to devolve approval decisions. For instance, statutory amendments enabling the Commonwealth to complete an assessment and approval where a state or territory is unable to, as well as to ensure agreements can endure minor amendments to state and territory settings, rather than requiring bilateral agreements to be remade (and hence be subject to disallowance by the Commonwealth on each occasion), failed to garner support as far back as 2015, which might have otherwise allowed bilateral approval agreements to be implemented.

Accredited processes

The Bill proposes to change the way bilateral approval and assessment agreements are made:

“Decisions or things”

The Minister may, by instrument, determine that any decision or thing is not to be inconsistent with a Standard. Consistency of decisions made or things done with a given Standard will be measured by reference to Commonwealth or state/territory policies, plans or programs, among other things.

Other key features of the Standards include:

• Disallowance – Standards are proposed to be legislative instruments for the purposes of the Legislation Act 2003, however the disallowance provision of that Act will not apply to the first Standard that is made in relation to a particular matter. Variations to Standards and subsequent Standards relating to the same matter may be disallowed. The Explanatory Memorandum explains that since the Minister must be satisfied that the processes accredited for a bilateral agreement are not inconsistent with one or more Standards that are in force, they are an essential pre-requisite for the entry into and operation of bilateral agreements. An exemption from the disallowance provisions for the first Standard in relation to a particular matter is required to ensure the effective operation of bilateral agreements.
• A public interest exception – the Minister will be empowered to act inconsistently with the Standards where he/she is satisfied it is in the public interest to do so. For instance, this may be where a Standard is incapable of being met due to the need to balance multiple protected matters, or the need to weigh up the environmental as against the social and/or economic impacts of a project. Any such decision must be accompanied by reasons published by the Minister on the Department’s website. Importantly this exception will apply to the Minister only, and states and territories will not be able to make decisions that are inconsistent with the standards.
• Introduction of Standards on an “interim” basis – when Standards are first introduced, they will come into effect on an interim basis and will subject to a first review within 2 years. Thereafter Standards must be reviewed at intervals of not more than 5 years.
• Third party consultation – the Minister will be required to consult with persons having knowledge and expertise in fields relevant to a proposed Standard prior to its introduction. It is anticipated that Standards will be developed in consultation with science, Indigenous, environmental and business stakeholders and the community, as well as states and territories.
• Standards may evolve – under the proposed Bill, Standards may apply, adopt or incorporate an instrument or other writing as in force or existing from time to time, even where such instruments or writings are not in existence when the Standards are made. For instance, they may refer to Australia’s obligations under international conventions or refer to Commonwealth instruments such as conservation advices.
• A grace period – once a Standard is introduced, states and territories will have between 1 to 6 months to ensure their processes are consistent with the Standard.
• Suspension or cancellation of bilateral agreements – the Minister will be empowered to suspend or cancel an approval bilateral agreement where satisfied that a state or territory has given effect to the agreement in a way that is inconsistent with a relevant Standard. The Minister may suspend or cancel a bilateral agreement either generally or in relation to a specified class of actions. If a new Standard is introduced or an existing Standard is varied and an existing state or territory process that underpins a bilateral agreement is inconsistent with that new or varied Standard, the Minister may suspend or cancel the agreement.
• Transitional arrangements – A new Standard or a variation to an existing Standard may specify the circumstances in which the Standard or variation does not apply in relation to any “decision or thing”. In addition, the Minister’s determination that a decision or thing must not be inconsistent with a Standard may be made subject to an exemption of one or more “processes” begun before the commencement of the Standard. Such processes might include, for instance, the decision to refer a proposal to take an action under Part 7 of the EPBC Act where such referral has not yet been determined at the time of the Standard commencing.

The Commissioner

In addition to introducing a framework for the implementation of Standards, the proposed Bill creates an independent statutory position of Environment Assurance Commissioner (Commissioner) that would sit within the Department and provide oversight of environmental assessment and approval systems to measure whether the outcomes of the Standards are being achieved. The Explanatory Memorandum to the Bill makes clear that the Commissioner’s assurance functions will be at a systems level, rather than extending to the oversight of individual decisions.

The Commissioner is proposed to have both auditing and monitoring functions, for instance in relation to the implementation of Standards by states and territories, and the processes for making controlled action decisions, for assessing the relevant impacts of controlled actions, and for approving the taking of controlled actions, including decisions as to the attachment of conditions of approval. The Commissioner’s oversight is also proposed to extend to processes for assessing impacts of an action under a strategic assessment and granting strategic assessment approval. The Commissioner will be required to publish audit reports, as well as annual work plans and annual reports.

Concluding remarks

In combination with the EPBC Amendment (Streamlining Environmental Approvals) Bill 2020 which was introduced to Parliament in August 2020 and is currently before the Senate (see our earlier article on this topic), this Bill marks a significant step in the Government’s implementation of the recommendations of the Samuel Review. It is clear the Government has prioritised the development of Standards in its agenda for reform, which it hopes will pave the way for a system of single-touch environmental approvals and the implementation of bilateral approval agreements, which to date has failed to be achieved.