29 May, 2016
In brief
The Victorian Government has released the report of the Ministerial Advisory Committee’s inquiry into the role, powers and governance structures of the Victorian Environment Protection Authority (EPA).
The report makes a number of far-reaching recommendations, including greater third party appeal rights against works approval and licence applications, higher criminal penalties coupled with a more robust prosecution culture, and greater integration of the EPA into strategic land-use planning. The Victorian government announced that it would consider the report’s recommendations and announce a response in late 2016.
Who needs to know?
Private and public sector corporations and entities that are regulated by the EPA, generate pollution or waste, or occupy or develop contaminated land in Victoria.
Recommended changes to governance structures
The report describes a number of limitations with the Environment Protection Act 1970 (Vic) (EP Act), particularly in respect to its treatment of the role and governance structures of the EPA.
To address these issues, the report recommends three new Acts:
- a standalone EP (Establishment) Act that would set out the EPA’s role, decision-making principles, and governance structure. Among other things, it would also require the appointment of an independent board to underscore the EPA’s independence from government,
- an Environment Protection (Integration and Co-ordination) Act to integrate and co-ordinate the EPA’s input into other agencies and regulatory bodies, particularly the land use planning functions of the Department of Environment, Land, Water and Planning, and
- a modernised Environment Protection Act.
Appointment of Chief Environmental Scientist
The inquiry concluded that the EPA is the environmental regulatory body with the greatest technical environmental and scientific expertise. To reflect this, the inquiry recommended that a new position be created under statute for a Chief Environmental Scientist.
The inquiry envisages that the Chief Environmental Scientist would review advice from EPA technical experts, and be a key point of liaison between the EPA and the State Government.
Strengthening the rights of third parties
The Victorian Civil and Administrative Tribunal (VCAT) has jurisdiction to review the merits of EPA decisions in respect of works approval applications, issuing or amending a licence, or removing the suspension of a licence.
However, third party rights of review of such decisions are limited to persons 'whoseinterests are affected by the decision’. The scope and ambit of third party rights of review under the EP Act have been the subject of several VCAT decisions, which are not always easy to reconcile.
The inquiry has recommended that standing should be offered to applicants on the same terms as those in section 5 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic), which encompasses persons whose interests are directly or indirectly affected by the decision, where those interests are not limited to proprietary, economic or financial interests.
This would have the effect of expanding the existing third party rights of review under the EP Act, and bring them in line with some other Victorian statutes.
The EPA’s role in land use planning
The inquiry found that the EPA has limited opportunity to influence strategic land use planning decisions, but nevertheless fields many complaints about amenity and health impacts that may have resulted from poor planning
decisions.
The inquiry acknowledged that it was not the role of the EPA to make planning decisions, but felt that its technical expertise would be a useful input into the planning decision-making process.
Accordingly, it recommended that a statutory trigger be introduced for the EPA to participate in the planning decision-making process by providing technical advice to the relevant decision-maker. The inquiry proposed that where a strategic land use planning process involved potentially significant environmental issues, it would trigger a request for EPA advice.
General environment duty
In line with environmental legislation in other Australian States and Territories, the inquiry has recommended that a modernised EP Act include a general duty to minimise risks of harm to human health and the environment. The proposed duty is described in the report as ‘the cornerstone of a preventative focus’ for the EPA.
A statutory general environmental duty is quite a powerful regulatory tool in other Australian States and Territories, and the inquiry has recommended that a breach of the duty should give rise to criminal penalties, civil penalties and/or civil remedies. It could also provide a uniform trigger for the issue of remedial notices, such as pollution abatement or clean up notices.
Greater prosecution of polluters
The inquiry found that as compared to other regulatory agencies, the EPA is slow to commence and conclude prosecutions of offending polluters. The report cited the proceedings related to the Hazelwood Mine fire, which only commenced two years after the event.
The inquiry concluded that the EPA must be willing to take timely and decision action to hold polluters to account. Such action may be through issuing polluters with court proceedings or having alleged offenders enter into enforceable undertakings with the EPA. More than anything, the inquiry felt that greater prosecution of offenders is a cultural issue at the EPA, and which it believed would be solved by the new establishment legislation and the independent board referred to above.
Increasing penalties and civil enforcement
The inquiry found that the maximum penalties for offences under the EP Act had not been reviewed since 2000. The only increases since then have been through the indexation of penalties. Similarly, the Inquiry found that unlike many other regulatory acts, there was no differentiation between offences committed by the natural person and offences by a body corporate for most offences.
Accordingly, the inquiry recommended that a modernised EP Act include increased maximum penalties that mirror equivalent legislation, such as the Occupational Health and Safety Act 2004 (Vic), and that differentiation between natural persons and corporations be introduced for all offences.
The inquiry also recommended that a civil penalty regime be included in a modernised EP Act, which will provide the EPA with an alternative to criminal prosecution. This could mirror existing civil enforcement opportunities available under Victorian planning legislation, and under environmental legislation in most other Australian States and Territories.
Response to the inquiry
The Victorian Government has announced that it will consider the recommendations made by the Committee over the coming months, with a response expected late 2016.
The EPA has welcomed the findings of the Inquiry.
For further information, please contact:
Tim Power, Partner, Herbert Smith Freehills
tim.power@hsf.com
