Budget Review 2020–21 Index

Sophie Power

The 2020–21 Budget provides an additional $36.6 million over two years from 2020–21 to ‘maintain the timeliness’ of environmental assessments and undertake further reforms under the Environment Protection and Biodiversity Conservation Act 1999 (EPBC Act) (Budget Measures: Budget Paper No. 2: 2020­–21, p. 51). The EPBC Act sets out an environmental assessment and approval regime for projects that are likely to have a significant impact on matters of national environmental significance, such as World Heritage properties, or nationally listed threatened species (see the Parliamentary Library’s quick guide to the EPBC Act).

Timeliness

Relevant decisions under the EPBC Act regime must be made by the Environment Minister (or his or her delegate) within certain statutory timeframes. For example, approval decisions must generally be made within 20–40 business days after an environmental assessment has been completed. In recent years, these timeframes have not been met.

This budget provision includes $12.4 million to ‘maintain the momentum’ established through the $25 million provided in the December 2019 Mid-Year Economic and Fiscal Outlook 2019–20 (MYEFO), ‘to work through the backlog of environmental approval applications, with a focus on major projects’ (MYEFO, p. 216). These funding boosts come in the context of a recent report by the Australian National Audit Office (ANAO) which found the administration of the EPBC Act is ‘not effective’. The report also found a large increase in delays in decision-making under the EPBC Act. According to the ANAO, the proportion of key decisions made within statutory timeframes decreased from 60 per cent in 2014–15 to 5 per cent in 2018–19. Over the same period, the average overrun for approval decisions increased from 19 days to 116 days, which correlates with reduced staffing levels in the department administering the EPBC Act. Some commentators have suggested the increased delays are a result of reduced resources, and that additional funding is ‘merely a reversal of previous funding cuts’.

As a result of the additional funding announced in December 2019, the Minister for the Environment has reported improvements in the timeliness of decision-making under the EPBC Act. In December 2019, 19 per cent of key decisions were made on time. By March 2020, this figure rose to 87 per cent and as at 30 June 2020, 98 per cent of key decisions were made on time. A backlog of overdue decisions remains, but has been reduced from 78 to 26 overdue decisions between December 2019 and June 2020. The additional funding in the Budget is designed to maintain this level of timeliness.

Fast-tracking major projects

In June 2020 the Prime Minister announced a ‘priority list of 15 major projects that are on the fast-track for approval’ and intended to cut approval times for major projects to 30 days. These 15 major projects ‘will be subject to the same requirements under the EPBC Act as all referred projects’, but the ‘Australian Government will work with the states and territories to establish joint assessment teams to progress these projects’. To this end, the Budget includes $8.8 million over two years to ‘expedite’ approvals for these major projects, which ‘are estimated to contribute more than $72 billion in public and private investment and will support tens of thousands of Australian jobs’ (Budget Paper No. 2, p. 51).

Although the new National Cabinet has endorsed the list of 15 major projects, the level of transparency involved in the process of choosing these projects has been queried. Some components of the 15 major projects had already been approved under the EPBC Act (such as the major works associated with Snowy 2.0). For other projects, the list potentially pre-empts ministerial approval under the EPBC Act. Projects are not automatically approved under the EPBC Act: before deciding whether or not to approve a project, the Minister must take into account a number of considerations, and the approval must also not be inconsistent with other matters, such as Australia’s international obligations under relevant treaties. However, since the EPBC Act commenced in 2000, only 13 projects have been refused at the approval stage compared to over 1,000 projects that have been approved.

Single-touch approvals

In July 2020 the Prime Minister announced that the National Cabinet had ‘agreed to move to single-touch environmental approvals underpinned by national environmental standards for Commonwealth environmental matters’. To this end, the Budget includes $10.6 million over two years to progress negotiations with the states and territories on bilateral agreements to accredit states to carry out environmental approvals for Commonwealth matters. Industry groups, such as the Minerals Council, have welcomed the Budget’s additional funding to support timely approvals. They have for many years called for measures to remedy duplication between the EPBC Act and state and territory approval processes, which they consider causes additional delays and costs for proponents of relevant projects. However, conservation groups are concerned that state and territory approval processes do not meet the standards required to protect matters of national environmental significance, and believe that the Commonwealth should retain regulatory powers and a leadership role, particularly where Australia has obligations under international agreements.

Legislation was introduced into Parliament in August 2020 to support this ‘single-touch environmental approvals’ proposal. As discussed in the Parliamentary Library’s Bills Digest, the Bill proposes to expand and clarify existing provisions in the EPBC Act that allow the Commonwealth to delegate environmental approval powers to states and territories. The Explanatory Memorandum states (p. 1) that ‘the Bill will not have direct financial impacts’ and the Environment Minister has reportedly indicated that the legislation ‘does not involve additional funding for the states’. However, the ACT Government has said it will request additional funding from the Commonwealth for the extra work involved if responsibility for EPBC approvals is transferred. In addition to the funding to progress negotiations, the Budget provides $11.1 million for states and territories to establish ‘interoperable’ environmental assessment systems, including a biodiversity data repository (Federal Financial Relations: Budget Paper No. 3: 2020–21, p. 58).

Response to EPBC Act review

Meanwhile, a ten year independent statutory review of the EPBC Act is currently underway. The review’s Interim Report was released in June 2020, with the final report due in October 2020. The Interim Report makes numerous findings and recommendations, and the Government has committed to addressing a number of ‘priority areas’ in response to that report, including developing national environmental standards to underpin the single touch approvals. Another priority area was to ’explore market based solutions for better habitat restoration’ and the Budget includes $2.5 million to support ‘policy work relating to environmental markets’ (Budget Paper No. 2, p. 51). The Interim Report identifies the development of biodiversity market mechanisms as a longer term reform, but some of the report’s more immediate suggested reforms and findings have not been addressed in the Budget. For example, the Interim Report found (p. 95) that monitoring and enforcement of the EPBC Act at the post-approval stage is ‘significantly under-resourced’. Although the Government responded that it would ‘take steps to strengthen compliance functions’, there does not appear to be any additional funding for this area and the Government has rejected the report’s recommendation to establish an independent regulator.

All online articles accessed October 2020

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