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The EPBC Act Review Interim Report – Fundamental Reform Recommended

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Written by Anna Vella and Aaron Beale.

Today, the Interim Report of the Independent Review of the Environmental Protection and Biodiversity Conservation Act 1999 (Cth) (EPBC Act) was released setting out preliminary views of the Independent Reviewer, Professor Graeme Samuel AC on the EPBC Act and how it operates. The Interim Report focuses on the fundamental inadequacies of the EPBC Act and proposes key reform directions to address them.

Professor Samuel states that "the EPBC Act is ineffective. It does not enable the Commonwealth to protect and conserve environmental matters that are important for the nation. It is not fit to address current or future environmental challenges."[1]

"The EPBC Act results in duplication with state and territory environment laws. The Commonwealth process for assessing and approving developments is slow, complex to navigate and costly for business. Slow and cumbersome regulation results in significant additional costs for business, with little appreciable benefit for the environment." [2]

Key findings of the review

A number of key points have been raised by Professor Samuel, namely:[3]

  • Australia's natural environment and iconic places are in an overall state of decline and are under increasing threat.

  • The construct of Australia's federation means that the management of the environment is a shared responsibility and jurisdictions need to work effectively together, and in partnership with the community.

  • Fundamental reform of national environmental law is required, and new, legally enforceable National Environmental Standards should be the foundation. Standards should be granular and measurable, providing flexibility for development, without compromising environmental sustainability.

  • National Environmental Standards should be regulatory instruments. The Commonwealth should make National Environmental Standards, in consultation with stakeholders, including the states and territories. The law must require the Standards to be applied, unless the decision-maker can demonstrate that the public interest and the national interest is best served otherwise.

  • Precise, quantitative standards, underpinned by quality data and information, will support faster and lower-cost assessments and approvals, including the capacity to automate consideration and approval of low-risk proposals.

  • The EPBC Act has failed to fulfil its objectives as they relate to Indigenous Australians. Indigenous Australians' traditional knowledge and views are not fully valued in decision-making, and the Act does not meet the aspirations of Traditional Owners for managing their land. A specific standard for best practice Indigenous engagement is needed to ensure that Indigenous Australians that speak for, and have traditional knowledge of, Country have had the proper opportunity to contribute to decision-making.

  • The community does not trust the EPBC Act to deliver effective protection of the environment and industry view it as cumbersome, duplicative and slow. Legal review is used to discover information and object to a decision, rather than to test and improve decision-making consistent with the law. Reforms should focus on improving transparency of decision-making to reduce the need to resort to court processes to discover information. Legal challenges should be limited to matters of outcome, not process, to reduce litigation that does not have a material impact on the outcome.

Proposed key reform directions

Proposed key reform directions to address fundamental inadequacies of the EPBC Act, include:

  • The Commonwealth should continue to focus on existing areas of responsibility  with no expansion to regulate new environmental matters. This means that the Interim Review does not recommend the inclusion of a "climate trigger" under the EPBC Act.

  • New, legally enforceable National Environmental Standards should be established to deliver ecologically sustainable development. Focused on outcomes rather than process.

  • Streamlining and greater efficiency through devolution in a way that provides community confidence, with National Environmental Standards as the foundation to set the outcomes needed regardless of who the decision maker is. This will facilitate bilateral arrangements with the States so that they may also issue approvals under the EPBC Act.

  • Strong and transparent assurance to ensure devolved decisions deliver the intended outcomes.

  • Australia's Indigenous cultural heritage laws need to be revieweddand more work is needed to support better engagement with Indigenous Australians and to respectfully incorporate traditional knowledge of Country in how the environment is managed.

  • Build trust in the system through increased transparency of information and decision-making to reduce the need to resort to court processes to discover information. Legal challenges should be limited to matters of outcome, not process.

  • A quantum shift in the quality of information is needed, so that the right information is available at the right time for the community, proponents and decision-makers. This will deliver better decisions, and faster and lower cost assessments and approvals.

  • A coherent framework to monitor and evaluate the effectiveness of the EPBC Act is needed, including revamped State of the Environment reporting.

  • Restoration of the environment must be a focus. Available habitat needs to grow to be able to support both development and a healthy environment. Further exploration of ways to accelerate environmental restoration such as markets and co-investing with the philanthropic and private sectors are required.

  • The creation of an independent compliance and enforcement regulator that is not subject to actual or implied political direction. The regulator should be properly resourced and have a full toolkit of powers.

Performance audit findings

Professor Samuel's comments mirror recent findings of the Auditor-General in an independent performance audit of the Department Agriculture, Water and the Environment (DAWE) (Audit Report) released in June 2020. The Audit Report, which was very critical of DAWE's performance, concluded that:[4]

  • Despite being subject to multiple reviews, audits and parliamentary inquiries since the commencement of the Act, the DAWE's administration of referrals, assessments and approvals of controlled actions under the EPBC Act is not effective.

  • Governance arrangements to support the administration of referrals, assessments and approvals of controlled actions are not sound. The department has not established a risk-based approach to its regulation, implemented effective oversight arrangements, or established appropriate performance measures.

  • Referrals and assessments are not administered effectively or efficiently. Regulation is not supported by appropriate systems and processes, including an appropriate quality assurance framework. The department has not implemented arrangements to measure or improve its efficiency.

  • The department is unable to demonstrate that conditions of approval are appropriate. The implementation of conditions is not assessed with rigour. The absence of effective monitoring, reporting and evaluation arrangements limit the department's ability to measure its contribution to the objectives of the EPBC Act.

Where to from here?

Whilst the Australian Government has not yet formally responded to the Interim Report, the Environment Minister Susan Ley has already made comments to:

  • rule out the creation of an independent compliance and enforcement regulator[5];

  • accept the recommendation for National Environmental Standards, to form the basis of an agreement with the States, allowing approvals under the EPBC Act to be devolved to the States; and

  • explore market-based opportunities for habitat restoration, for which an environmental markets expert advisory group is to be established. [6]

The DAWE has also agreed to implement all recommendations in the Audit Report and will prioritise its resources to ensure that its response is flexible to any changes to the regulatory system as a result of the EPBC Act review. As discussed in our previous update in May 2020, the Interim Report and any final report may impact upon the future passage of the Environment Protection and Biodiversity Conservation Amendment (Climate Trigger) Bill 2020 (Cth) currently before the Senate Environment and Communications Legislation Committee for inquiry.

While the EPBC Act has been the subject of a previous review which led to minimal reform, perhaps the perfect storm of the Interim Report, the Audit Report, the political agenda to deliver changes to EPBC Act assessment processes[7] to facilitate economic outcomes may well result in substantive change to the EPBC Act upon finalisation of the ultimate review recommendations (if not sooner).

The public have been invited to have a say about the reform directions in the Interim Report. Professor Samuel is keen to understand views on what he may have missed, how the proposed reform directions could be improved and if there are fundamental shortcomings in his views that would require him to rethink. The feedback period will close at 9:00am on 17 August 2020.

As shown by the timeline below, the release of the final report is the next milestone in the review process.

 

If you would like to discuss the findings of the Interim Report further, please let us know.


 

[1] DAWE, Media statement: Professor Graeme Samuel AC releases Interim Report (20 July 2020) <https://epbcactreview.environment.gov.au/news/media-statement-professor-graeme-samuel-ac-releases-interim-report>.

[2] Ibid.

[3] DAWE, Interim Report Summary points (June 2020) < https://epbcactreview.environment.gfov.au/resources/interim-report/summary-points>.

[4] DAWE, Referrals, Assessments and Approvals of Controlled Actions under the Environment Protection and Biodiversity Conservation Act 1999 (25 June 2020) < https://www.anao.gov.au/work/performance-audit/referrals-assessments-and-approvals-controlled-actions-under-the-epbc-act>.

[5] https://www.abc.net.au/news/2020-07-20/epbc-act-environmental-review-report-recommends-independent-cop/12392594

[6] https://minister.awe.gov.au/ley/media-releases/reform-australias-environment-laws

[7] Prime Minister of Australia, CEDA's State of the Nation Conference (15 June 2020) <https://www.pm.gov.au/media/address-%E2%80%93-ceda%E2%80%99s-state-nation-conference>...

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