BILLS DIGEST NO. 73, 2017–18              6 February 2018

Australian Capital Territory (Planning and Land Management) Amendment Bill 2017

Philip Hamilton
Politics and Public Administration Section

Date introduced: 6 December 2017

House:  Senate

Portfolio: Local Government and Territories

Commencement: 1 July 2018

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill’s home page, or through the Australian Parliament website.

When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the Federal Register of Legislation website.

All hyperlinks in this Bills Digest are correct as at February 2018.

Purpose of the Bill

The purpose of the Australian Capital Territory (Planning and Land Management) Amendment Bill 2017 (the Bill) is to amend the Australian Capital Territory (Planning and Land Management) Act 1988 (ACT (PALM) Act) to amend governance arrangements for the National Capital Authority (NCA).[1]

Structure of the Bill

The Bill comprises one Schedule divided into two Parts:

•       Part 1 comprises proposed amendments to the ACT (PALM) Act.

•       Part 2 comprises saving and transitional provisions.

Background

National Capital Authority

Established by the ACT (PALM) Act when the ACT was granted self-government, the NCA manages the interests of the Commonwealth in Canberra, with particular focus on the planning and management of major Commonwealth assets in nationally important areas. As noted by the Explanatory Memorandum to the Bill:

… these assets are a broad collection of public open spaces, lakes, dams, memorials, infrastructure and buildings. The NCA also prepares and administers the National Capital Plan, and reviews and proposes amendments as necessary.[2]

The NCA’s governing board (referred to in the ACT (PALM) Act as the Authority) comprises a Chairperson and four members appointed by the Governor-General for a period of up to five years.[3] If the Chairperson is appointed on a part-time basis (as is currently the case), a full-time Chief Executive and three part-time non-executive members are appointed.[4]

In December 2017 the Government announced the appointment of Ms Sally Barnes as Chief Executive, with her appointment to commence on 11 February 2018.[5] The previous Chief Executive, Mr Malcolm Snow, resigned in July 2017 after serving almost four years of a five-year term to take up a senior planning role with the ACT Government.[6]

‘Agency head’ and ‘Accountable authority’

In the Commonwealth public sector, responsibility for the management of each Commonwealth entity is assigned under two statutory regimes.

1.       Legislation such as the Public Service Act 1999 (PS Act), or the specific legislation that establishes a particular agency, assigns responsibility for management functions (typically including staffing) to a CEO-type position. Agency head is the term used in the PS Act to describe CEO-type positions such as the Secretary of a Department.[7] The ACT (PALM) Act establishes that for the purposes of the PS Act the Chief Executive is the head of the NCA.[8]

2.       Accountable authority is the term used in the Public Governance, Performance and Accountability Act 2013 (PGPA Act) to assign responsibility for reporting and accountability for the use and management of public resources.[9] Currently, the ACT (PALM) Act designates the Chief Executive of the NCA as the accountable authority.[10]

These Acts operate so that the roles of agency head and accountable authority are in some cases performed by the same person and in some cases are not. For instance, the Secretary of a Department will always be the agency head and the accountable authority.[11] The Bill separates the roles, so that the NCA’s Chief Executive remains as the head of the entity for the purposes of the PS Act, but the Authority (of which the Chief Executive is a member) would become the accountable authority for the purposes of the PGPA Act.[12]

Directions

Described by the Explanatory Memorandum as amendments that ‘clarify the Minister’s existing powers’,[13] the Bill also proposes to insert ‘must comply’ provisions in relation to directions issued by the Minister to the Authority, and directions issued by the Authority to the Chief Executive. Currently, the expression ‘must comply’ does not occur in the ACT (PALM) Act.

Committee consideration

Senate Standing Committee for Selection of Bills

At a meeting on 6 December 2017, the Senate Standing Committee for Selection of Bills deferred consideration of the Bill to its next meeting.[14]

Senate Standing Committee for the Scrutiny of Bills

At the time of writing this Bills Digest, the Senate Standing Committee for the Scrutiny of Bills had not reported on the Bill.

Policy position of non-government parties/independents

At the time of writing this Bills Digest, non-government parties and independents had not expressed their positions in relation to the Bill.

Position of major interest groups

The Explanatory Memorandum notes that the NCA and other relevant Government entities have been consulted about the Bill, but does not indicate that major interest groups have been consulted.[15]

The Parliament’s Joint Standing Committee on the National Capital and External Territories (JSCNCET) holds a public hearing with the NCA every six months.[16] At hearings in November and December 2016 and June and December 2017 there was no discussion of the NCA’s current or proposed governance arrangements (except to note Chief Executive acting arrangements following the departure of Malcolm Snow).[17]

This could be interpreted as evidence that major interest groups do not have strong views about the NCA’s governance arrangements. Alternatively, it could indicate a lack of awareness of the Bill, which was introduced into the Senate the day before the JSCNCET hearing of 7 December 2017.

Financial implications

The Explanatory Memorandum states that ‘this Bill would have no financial impact’.[18]

Statement of Compatibility with Human Rights

As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible because ‘it does not raise any human rights issues’.[19]

Parliamentary Joint Committee on Human Rights

At the time of writing this Bills Digest, the Parliamentary Joint Committee on Human Rights had not reported on the Bill.

Key issues and provisions

Absence of a review

A recent review of governance of the Great Barrier Reef Marine Park Authority observed that ‘there is no definitive guidance to support the selection of an appropriate governance model for public sector entities’.[20] General information and guidance about governance policy is available from the Department of Finance, which further recommends that ‘the governance policy can … be used to review whether a body’s governance arrangements remain fit-for-purpose’.[21]

There is no indication that the NCA’s governance arrangements have been either problematic or subject to review—and so the rationale for the amendments in this Bill is not known. Whilst the Bill’s Explanatory Memorandum states that current arrangements ‘[do] not provide decision making within the NCA with sufficient oversight and transparency, nor provide the requisite support to the Minister’, the basis for the statement is not known.[22]

In contrast, in several recent examples substantive independent reviews preceded changes to entities’ governance arrangements.[23]

Commencement

The Bill proposes that all amendments would commence on 1 July 2018.[24]

Accountable authority

Section 5 of the ACT (PALM) Act establishes and names the Authority. The Bill repeals and replaces paragraph 5(2)(b) of the ACT (PALM) Act to designate the Authority as the accountable authority under the PGPA Act.[25] Currently, the Chief Executive is the accountable authority.

The option for the accountable authority of a non-corporate Commonwealth Entity (NCE) to consist of a group of people (such as a governing board) rather than an individual was a new provision that became available when the PGPA Act came into effect on 1 July 2014.[26] Prior to the enactment of the PGPA Act, the Financial Management and Accountability Act 1997 required that the relevant duties at an NCE be performed by the Chief Executive.[27]

The Australian Organ and Tissue Donation and Transplantation Authority (OTA) was the first NCE at which a group of people was designated as the accountable authority. In November 2016, amendments were passed to replace the Advisory Council of the OTA with a governing Board that also assumed some of the responsibilities previously assigned to the OTA’s CEO, including the role of accountable authority.[28] The CEO of the OTA continues to be the head of the entity for the purposes of the PS Act.[29] The OTA is therefore an example of arrangements at a listed entity where the roles of agency head and accountable authority have been separated, and assigned to a CEO and a board, respectively.

However, the OTA differed from the NCA in that, in accordance with review recommendations, the split of responsibilities coincided with a major reconstitution of the Board’s role and the skills base of its membership.[30] As previously stated, no such need has been identified at the NCA.

Item 2 of Part 1 of the Bill repeals existing subparagraphs 5(2)(c)(i) and (ii) of the ACT (PALM) Act and inserts proposed subparagraph 5(2)(c)(i). This is a consequential amendment which specifies that members of the Authority are officials of the NCA for the purposes of the PGPA Act. Officials have various duties under the PGPA Act (see Division 3 of Part 2-2 of the PGPA Act). For example, section 25 of the PGPA Act requires officials to perform their roles with care and diligence which is an appropriate obligation for an accountable authority.

Directions amendments

Media reporting on directions prior to introduction of the Bill

Ministerial directions were mentioned in media coverage of the NCA’s involvement in the approvals process for a music festival in Commonwealth Park, Canberra in November 2017, particularly in relation to a proposal for pill-testing. A number of parties were involved (the NCA, the ACT Government, the festival promoter and the provider of the proposed pill-testing service) and various perspectives of the process have been reported in the media.[31] At the JSCNCET hearing on 7 December 2017, the NCA summarised the matter:

In September 2017 the media reported the ACT government had approved pill testing for the upcoming Spilt Milk festival. Spilt Milk is an all-day-and-night music festival, attracting 26,000 people aged between 18 and 24. The NCA were not advised of this decision prior to the announcement and, as the event was to be held on national land, requested information about the process for approving pill testing on land that effectively was not managed by the ACT government. The NCA requested information pertaining to the legal framework within this decision and the extent of liability as to the approval authority should an incident occur.

In October 2017, after meetings with the ACT government, the organisers of Spilt Milk announced that they would not hold pill testing at the festival and applied for an event permit. The event went ahead in November without pill testing. However, there was considerable national media coverage in relation to the testing at the festival, some of which made reference to the NCA. I make the statement that the NCA is a statutory authority independent of external and government influences.[32]

For the purposes of this Digest, it is relevant that media reports indicate that in September 2017 a letter was sent from the ACT Shadow Attorney-General to the Commonwealth ministers for Health and Local Government and Territories, noting the latter minister’s capacity to give the Authority general directions in writing as to the performance of its functions.[33] On 14 October 2017, after it became apparent that pill-testing would not occur at the festival, it was reported that ‘it is unclear what action, if any, either minister took’ in response to the letter.[34]

Directions by the Minister to the Authority

Currently, section 7 of the ACT (PALM) Act provides that ‘the Minister may give the Authority general directions in writing as to the performance of its functions’ and requires particulars of any directions to be included in the NCA’s annual report. Section 7 will be repealed and replaced by item 3 of Schedule 1 to the Bill. Proposed subsections 7(1) and (2) would provide that the Minister may give general directions to the Authority by legislative instrument, with which the Authority ‘must comply’.[35] Such directions are not subject to disallowance or sunsetting.[36]

The amendment restates the Minister’s power to give general directions. This means that it is not open to the Minister to give the Authority a direction which is specific to a matter under its consideration. However, the Bill makes clear that a Ministerial direction must be complied with. Essentially this makes explicit a power which is currently implicit.

Directions by the Authority to the Chief Executive

Currently, section 46 of the ACT (PALM) Act provides that ‘the Chief Executive has the responsibility of managing the affairs of the Authority under the general directions of the Authority’. Item 4 of Schedule 1 to the Bill will repeal and replace section 46. Proposed subsections 46(1) and (2) would provide that the Chief Executive has responsibility for managing the affairs of the Authority and that the Authority may give written directions to the Chief Executive as to that management. The proposed provisions do not restrict these to ‘general’ directions, as is the case with the current provision. Proposed subsections 46(3) and (4) would provide that the Chief Executive ‘must comply’ with a direction by the Authority, except to the extent that the direction relates to the Chief Executive’s functions under the PS Act.

The amendment would change the relationship between the Authority and the Chief Executive, with a ‘hands-on’ role foreshadowed for the Authority. The Bill’s Explanatory Memorandum states that the amendment will:

enable the Authority to influence the operations of the NCA … [while] ensur[ing] that the Chief Executive’s autonomy is preserved when it comes to decisions relating to the employment of staff at the NCA. For example, the Authority will be able to direct the Chief Executive to allocate additional resources in a particular area but will not have the ability to direct the Chief Executive to employ particular individuals.[37]

Similarly, the second reading speech to the Bill anticipates that:

While the Authority would take on a greater role in oversighting corporate management, most day-to-day operations would still be handled by the Chief Executive.’[38] [underlining added]

Effect of the directions amendments

The combined effect of proposed subsections 7(2) and 46(3) would be to create compliance obligations from the Minister, through the Authority, to the Chief Executive.

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[1].              From 1989 to 1996 the name of the entity was the National Capital Planning Authority.

[2].              Explanatory Memorandum, Australian Capital Territory (Planning and Land Management) Amendment Bill 2017, p. 2.

[3].              ACT (PALM) Act, sections 33 and 36. Members may be appointed for more than one term.

[4].              Ibid., subsection 33(4).

[5].              D Chester (Minister for Infrastructure and Transport), Sally Barnes appointed Chief Executive of NCA, media release, 14 December 2018.

[6].              J Briggs (Assistant Minister for Infrastructure and Regional Development), National Capital Authority welcomes new Chief Executive, media release, 19 December 2013; T Weber (Chair, National Capital Authority), Evidence to Joint Standing Committee on the National Capital and External Territories, Review of the National Capital Authority: biannual public briefings, (proof), 7 December 2017, p. 2.

[7].              PS Act, section 7.

[8].              ACT (PALM) Act, paragraph 47(2)(b).

[9].              PGPA Act, section 12.

[10].              ACT (PALM) Act, paragraph 5(2)(b).

[11].              PGPA Act, section 12.

[12].              Explanatory Memorandum, Australian Capital Territory (Planning and Land Management) Amendment Bill 2017, p. 2.

[13].              Ibid.

[14].              Senate Standing Committee for Selection of Bills, Report, 15, 2017, The Senate, Canberra, 7 December 2017.

[15].              Explanatory Memorandum, Australian Capital Territory (Planning and Land Management) Amendment Bill 2017, p. 2.

[16].              Joint Standing Committee on the National Capital and External Territories, Review of the National Capital Authority: Biannual public briefings homepage, Parliament of Australia website.

[17].              T Weber (Chair, National Capital Authority), Evidence to Joint Standing Committee on the National Capital and External Territories, op. cit., p. 2.

[18].              Explanatory Memorandum, Australian Capital Territory (Planning and Land Management) Amendment Bill 2017, p. 3.

[19].              The Statement of Compatibility with Human Rights can be found at page 4 of the Explanatory Memorandum to the Bill.

[20].              W Craik, Review of governance of the Great Barrier Reef Marine Park Authority, Department of the Environment and Energy, report, Canberra, July 2017, p. 43.

[21].              Department of Finance, ‘Reviewing existing Commonwealth bodies’, Department of Finance website, last updated 18 December 2015.

[22].              Explanatory Memorandum, Australian Capital Territory (Planning and Land Management) Amendment Bill 2017, p. 2.

[23].              Changes to the Australian Organ and Tissue Donation and Transplantation Authority (OTA) in 2016 were preceded by a Review of the implementation of the national reform agenda on organ and tissue donation and transplantation, Department of Health, August 2015. The establishment of the Australian Digital Health Agency in 2016 to replace the National E-Health Transition Authority Ltd was preceded by the Review of the personally controlled electronic health record, [Department of Health], December 2013. Governance arrangements for the Great Barrier Reef Marine Park Authority (GBRMPA) would be changed by the Great Barrier Reef Marine Park Amendment (Authority Governance and Other Matters) Bill 2017 currently before Parliament. This Bill was preceded by the Review of governance of the Great Barrier Reef Marine Park Authority.

[24].              Clause 2 of the Bill.

[25].              Inserted by item 1 in Part 1 of Schedule 1 to the Bill.

[26].              For further information about the introduction of the PGPA Act see D Weight and N Horne, Public Governance, Performance and Accountability Bill 2013, Bills digest, 162, 2012–13, Parliamentary Library, Canberra, 2013.

[27].              Financial Management and Accountability Act 1997, section 44.

[28].              P Hamilton, ‘Australian Organ and Tissue Donation and Transplantation Authority Amendment (New Governance Arrangements) Bill 2016’, FlagPost, Parliamentary Library blog, 23 November 2016.

[29].              Australian Organ and Tissue Donation and Transplantation Authority Act 2008, paragraph 25(2)(b).

[30].              Department of Health, Review of the implementation of the national reform agenda on organ and tissue donation and transplantation, op. cit., pp. 45–6.

[31].              L Cooper, ‘Pill testing at Spilt Milk Festival reportedly won't be happening’, The Huffington Post Australia, 12 October 2017; S Groch and D Burdon, ‘Denials of political influence on pill testing’, The Canberra Times, 14 October 2017, p. 1; J Dale, ‘What exactly happened with Aussie fest Spilt Milk's failed pill testing trial?’, TheMusic.com.au, 24 November 2017.

[32].              T Weber (Chair, National Capital Authority), Evidence to Joint Standing Committee on the National Capital and External Territories, op. cit., p. 1.

[33].              ABC Radio Canberra, ‘Pill testing advocate says “pressure”, not lack of documentation, to blame for abandoned Spilt Milk trial’, ABC news, (online edition), 13 October 2017.

[34].              S Groch and D Burdon, ‘Denials of political influence on pill testing’, The Canberra Times, 14 October 2017, p. 1.

[35].              Proposed subsection 7(3) would provide an exception such that the Authority is not required to comply to the extent that a direction relates to the Authority’s performance of functions or exercise of powers under the PGPA Act. This reflects the Authority’s proposed role as the accountable authority of the NCA. Proposed subsection 7(4) would provide that Ministerial directions would continue to be reported in the NCA’s annual report.

[36].              Legislation (Exemptions and Other Matters) Regulation 2015, section 9, table item 2; section 11, table item 3.

[37].              Explanatory Memorandum, Australian Capital Territory (Planning and Land Management) Amendment Bill 2017, pp. 5–6.

[38].              J McGrath (Assistant Minister to the Prime Minister), ‘Second reading speech: Australian Capital Territory (Planning and Land Management) Amendment Bill 2017’, Senate, Debates, 6 December 2017, p. 9897.