Chapter 1


Chapter 1

Introduction

Reference

1.1        On 14 March 2013, the Senate referred the Water Efficiency Labelling and Standards (Registration Fees) Bill 2013 [Provisons] (the bill) and the Water Efficiency Labelling and Standards Amendment (Registration Fees) Bill 2013 [Provisons] (the amendment bill) to the Environment and Communications Legislation Committee for inquiry and report by 17 June 2013.

Conduct of inquiry

1.2        The committee advertised the inquiry in The Australian newspaper and called for submissions by 11 April 2013. Details of the inquiry were also made available on the committee's website.

1.3        The committee contacted a number of organisations inviting submissions to the inquiry. Submissions were received from 9 individuals and organisations, as listed in Appendix 1.

Background and purpose of the bill

1.1        The Explanatory Memorandum (EM) to the bill provides that the Water Efficiency Labelling and Standards (Registration Fees) Bill 2013 (the bill) would furnish legislative power to recover costs of the administration of the Water Efficiency Labelling and Standards (WELS) scheme through taxes, in the form of fees for applying for registration.[1]

1.2        The WELS scheme was established by the Water Efficiency Labelling and Standards Act 2005 (Cth) (WELS Act) and corresponding state and territory legislation. The objectives of the WELS Act are to:

  • conserve water supplies by reducing water consumption;
  • provide information for purchasers of water-use and water-saving products; and
  • promote the adoption of efficient and effective water-use and water-saving technologies.

1.3        The scheme aims to address these objectives by requiring registration and labelling of specified products to show their water efficiency for the purposes of supply, and setting minimum water efficiency standards which products must meet if they are to be supplied.

1.4        The committee is also examining the Water Efficiency Labelling and Standards Amendment (Registration Fees) Bill 2013 (the amendment bill) which would make consequential amendments to the WELS Act.[2] Together, these bills would provide the legal basis for implementation of the November 2011 decision by the COAG Standing Council on Environment and Water that the scheme should recover 80 per cent of its costs from registrants. This decision reiterated the intention of governments at the scheme’s inception.[3]

1.5        The bill would enable the minister to set fees for applications for registration under the WELS scheme, taking into account all costs of the scheme. In the absence of this bill and the consequential amendments to the WELS Act, the scheme would be limited to charging a fee for service, which may only take into account scheme costs associated with product registration, but not other costs such as standard setting, compliance monitoring, enforcement or communications.[4]

Provisions of the bill

1.6        The bill provides that the minister may, by legislative instrument, specify one or more registration fees per application for registration.[5] The EM provides that, at the present time, there is no intention to charge multiple fees, but that this subclause has been included to allow future flexibility in the design of the scheme.[6]

1.7        As the scheme is administered by the Commonwealth on behalf of the States and Territories, and each contributes funding to the scheme, the Act places consultation obligations on the minister before specifying registration fees. The minister would be required to provide a draft of the instrument (specifying the registration fees) to each participating state or territory (subclause 7(4)). If the minister receives comments from the states or territories, he or she would be able to take them into account only to the extent that they are related to the cost of administering the WELS scheme (as provided in subclause 8(2)).[7]

1.8        Subclause 8(1) would provide that a legislative instrument made under subclause 7(1) to specify registration fees may do so by nominating an amount as the fee or by providing a formula for calculating the amount of the fee.

1.9        Subclause 8(2) would provide that before setting the fee the minister must be satisfied that the fee is not intended to recover more than 100 per cent of the costs of administering the scheme. It is proposed that the fee would be intended to recover 80 per cent of the costs of the administering the scheme. As governments may wish to change this policy in the future, this clause provides flexibility as to the extent of cost recovery which is to be achieved, so long as the fee is not intended to raise revenue for purposes which are not costs of the scheme.

1.10      Additionally, as the cost of administering corresponding state and territory laws is included in the costs of administering the scheme, the bill would provide that the minister may, when setting the fee, have regard to relevant decisions made by the participating jurisdictions in relation to the budget for the scheme. For example, the minister may consider the agreements on the annual cost of the scheme made by ministers in relation to each three-year WELS strategic plan.[8]

Provisions of the amendment bill

1.11      The amendment bill would preserve the ability of the minister to charge application fees under the existing provisions of the WELS Act.[9] However, the EM makes clear the Government's intention that a new regime of charges (via an instrument authorised under the bill) would replace the existing WELS Act charges. This is intended to provide future flexibility in the design of the WELS registration arrangements.[10]

1.12      The amendment bill adds to the matters the minister may include in the legislative instrument made under section 26 of the WELS Act.[11] These additional matters may require or permit the WELS Regulator to refuse, or refuse to consider, an application where the fee imposed under the Water Efficiency Labelling and Standards (Registration Fees) Act 2013 (assuming it receives Royal Assent) has not been paid, or is not paid within the specified time. Such requirements would ensure that registration fees are paid prior to applications being accepted, ensuring that applicants for registration may not benefit from product registration without having paid for it.

1.13      Item 3 of the amendment bill also provides that the legislative instrument promulgated under section 26 of the WELS Act may also require or permit the Regulator to waive or refund, in whole or part, a fee imposed by the Water Efficiency Labelling and Standards (Registration Fees) Act 2013. It is intended that any matters so included in a legislative instrument made under section 26 would be included for the purposes of assisting the regulator to administer the registration fees in a fair and efficient manner. It is not intended that these matters would contribute to the registration fees being administered in an inconsistent or arbitrary manner. The scheme formulated would specify any considerations or circumstances under which a waiver or refund of the application fee would be considered by the regulator. Examples of instances where such rules might assist the appropriate administration of the WELS scheme are provided in the EM.[12]

1.14      Other matters addressed in the amendment bill include the resolution of inconsistencies between schemes formulated under the WELS Act and state and territory legislation; and the requirement fees received under the proposed Act to be paid into a Special Account.[13]

Human Rights implications

1.15      The Explanatory Memoranda for each bill reports that they have been assessed against the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011, and that neither engages any of the applicable rights or freedoms.[14]

Scrutiny of Bills Committee comment

1.16      While the Senate Standing Committee for the Scrutiny of Bills noted that it is preferable for fees to be set in primary legislation, they considered that sufficient constraints were imposed by the bill to recommend that:

In light of the explanation for the approach contained in the explanatory memorandum and the existence of some constraints on the setting of the fees, the committee makes no further comment and leaves the question of whether the proposed approach is appropriate to the consideration of the Senate as a whole.[15]

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