1.1
On 3 September 2020, the Senate referred the provisions of the following five bills to the Environment and Communications Legislation Committee for inquiry and report by 30 September 2020:
Recycling and Waste Reduction Bill 2020 (the RWR bill);
Recycling and Waste Reduction (Consequential and Transitional Provisions) Bill 2020 (RWR Consequential and Transitional bill);
Recycling and Waste Reduction Charges (General) Bill 2020 (RWR General bill);
Recycling and Waste Reduction Charges (Customs) Bill 2020 (RWR Customs bill); and
Recycling and Waste Reduction Charges (Excise) Bill 2020 (RWR Excise bill).
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On 30 September 2020, the Senate granted the committee an extension of time to report to 1 October 2020.
1.3
The Selection of Bills Committee report outlined two reasons for this referral. Firstly, it stated that the package of RWR bills 'may see significant reform to waste management and have significant environmental implications'. Secondly, it commented that the bills would 'introduce significant changes to the regulatory framework for the export of waste materials, and it will be important to ensure that the measures included are appropriate'.
Conduct of the inquiry
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The committee advertised the inquiry in the usual manner, on its website, and wrote to a number of organisations inviting submissions.
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The committee received 24 submissions, which are available in full on the committee's website.
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The committee held a public hearing on 18 September 2020. A full list of witnesses who attended the hearing is at Appendix 2 of this report, and the Hansard transcript of evidence is available on the committee's website.
Structure of this report
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This report comprises two chapters:
this chapter provides a background to the bills, as well as an overview of their purpose and provisions; and
Chapter 2 considers the issues raised in evidence about the bills' intentions and provisions, and sets out the committee's views and recommendations.
Background, purpose and overview of the bills
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In August 2019, the former Council of Australian Governments (COAG) announced its intention to develop and implement a waste export ban on waste glass, plastics, tyres and paper.
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In her second reading speech, the Minister for the Environment, the Hon Sussan Ley MP (the Minister), stated that the RWR bill would implement this COAG commitment, as well as incorporating the existing product stewardship framework:
This bill implements the agreement by all of Australia's governments to ban the export of waste plastic, paper, glass and tyres. It also incorporates the framework of the existing Product Stewardship Act 2011. It includes improvements to better regulate and encourage our businesses—those that design, manufacture, distribute and use products—to take greater responsibility for their environmental impacts.
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The Explanatory Memorandum states that the commitment to ban the export of waste materials was a target of the National Waste Policy Action Plan 2019, which:
…includes actions aimed at driving change in industry, businesses, governments and the community to turn waste into a reusable commodity. COAG's Response Strategy for Phasing Out Exports of Waste Plastic, Paper, Glass and Tyres, released in March 2020, sets out the system‑level and material-specific challenges and opportunities that are central to the effective implementation of the waste export ban, and to the longer term transformation of Australia's waste and recycling sector.
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More broadly, the Commonwealth's 2018 National Waste Policy is a 'framework for collective action by businesses, governments, communities and individuals until 2030'. It identifies five overarching circular economy waste principles, namely:
1. Avoid waste:
Prioritise waste avoidance, encourage efficient use, reuse and repair
Design products so waste is minimised, they are made to last and we can more easily recover materials.
2. Improve resource recovery:
Improve material collection systems and processes for recycling
Improve the quality of recycled material we produce.
3. Increase use of recycled material and build demand and markets for recycled products.
4. Better manage material flows to benefit human health, the environment and the economy.
5. Improve information to support innovation, guide investment and enable informed consumer decisions.
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The Explanatory Memorandum also states that the RWR bill would incorporate the current provisions of the Product Stewardship Act 2011 (Product Stewardship Act), which would be repealed by the RWR Consequential and Transitional bill. The Product Stewardship Act came into effect in August 2011, and according to departmental information:
This legislation provides the framework to effectively manage the environmental, health and safety impacts of products, and in particular those impacts associated with the disposal of products. The framework includes voluntary, co-regulatory and mandatory product stewardship.
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The Product Stewardship Act was recently reviewed as required by the Act. This review made 26 recommendations for improving current product stewardship arrangements. In its July 2020 response, the government welcomed the findings of the review, supported all of the review's recommendations, and stated that it will immediately commence action on its 26 recommendations.
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The Explanatory Memorandum states that the reforms would have a range of environmental, health and economic benefits:
The objects of the Bill will include reducing the impact that products and waste material have on human and environmental health and realising community and economic benefits by taking responsibility for products and waste material. The objects will be achieved by regulating the export of waste material to promote its management in an environmentally sound way, encouraging reuse, recycling and recovery of products, as well as responsible product design.
Overview of the waste export ban
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The RWR bill would ban the export of unprocessed waste materials on the following timeline:
glass from 1 January 2021;
mixed plastics from 1 July 2021;
whole used tyres from 1 December 2021;
single resin or polymer plastics from 1 July 2022; and
mixed and unsorted paper and cardboard from 1 July 2024.
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The export ban would only apply to unprocessed waste, which would allow for the processing of waste materials within Australia for subsequent export for use in overseas manufacturing. The Minister stated that this offers an economic opportunity for Australia:
The waste export ban is a once-in-a-generation opportunity to transform our waste management and recycling sector to collect, recycle, reuse and convert waste into a resource. This reform is expected to see the Australian economy turn over an additional $3.6 billion and potentially generate $1.5 billion in economic activity over the next 20 years.
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In her second reading speech, the Minister stated that details for the implementation of the waste export bans for particular materials would be phased in with ongoing consultation with stakeholders:
This bill establishes an important framework. It enables the legislative instruments needed to bring the waste export ban to life. Rules will be in place for glass by the end of this year, and rules for other waste streams will follow in line with the agreed time frames.
In advance of each material being phased in, the Department of Agriculture, Water and the Environment will continue consulting with relevant stakeholders to ensure their views are considered in developing the legislation.
Conditions of export
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The RWR bill sets out provisions for the export of certain 'regulated waste material', if certain conditions are met. The Explanatory Memorandum states that:
The rules will be able to prescribe conditions that must be complied with depending on the waste material being exported. For example, the rules may require that:
a person must hold an export licence; and
for each consignment of regulated waste material, an export declaration has been given.
Product stewardship, and incorporation of the Product Stewardship Act
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As outlined above, the RWR bill incorporates the provisions of the current Product Stewardship Act. The Explanatory Memorandum outlines the rationale for this:
The review of the Product Stewardship Act 2011 found that whilst the existing legislative framework provides an appropriate framework for enabling product stewardship outcomes, there is scope to improve and broaden its reach and impact. The recommendations of the review included promoting product design and reparability within the objects of the Act, expanding product stewardship regimes to a broader range of products (including materials), addressing issues with free-riding in voluntary product stewardship schemes, increasing transparency with the Minister's product list, and improving the administration of co-regulatory schemes.
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The RWR bill sets out a framework of obligations for manufacturers, importers and distributors of certain products, as well as for the accreditation of voluntary product stewardship arrangements. The Explanatory Memorandum states:
There are several key drivers for a national approach to product stewardship. These include a need to have the regulatory tools to respond to the growing, complex and potentially hazardous streams of waste from rapidly changing or evolving products and encourage responsible product management by producers, businesses and consumers.
There is also a lack of information that prevents consumers and producers from understanding the impacts of certain products, and related issues around their reparability and reusability. Accreditation of voluntary product stewardship schemes can help Australian consumers make better choices when purchasing and disposing of products, and to have confidence that the products they are choosing meet government accreditation requirements.
Compliance, enforcements and audits
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The RWR bill provides a range of compliance, enforcement and audit mechanisms. These include certain powers for a Minister, Departmental Secretary, or authorised officers, including for the making of rules and decisions, the conducting of audits, and fees and charges.
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Regarding Ministerial, Secretary or authorised officer powers, the Explanatory Memorandum states:
These powers will include actions such as revocation and suspension of an export licence and cancellation of an approval of a co-regulatory arrangement as well as administrative remedies of injunctions, enforceable undertakings, and infringement notices. For more serious compliance issues, the Bill will provide for a number of civil penalty provisions as well as criminal offences.
The Bill will also provide for the Minister to make a number of decisions, some of which may affect the interests of individuals. The Bill provides for merits review to be available in relation to decisions by the Minister that affect individuals. Decisions will also be able to be reviewed externally by the Administrative Appeals Tribunal.
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The Explanatory Memorandum states that fees and charges under the RWR bill would be imposed 'on a cost-recovery basis'.
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Under the provisions of the RWR bill, the Minister would also be able to make rules:
The rules will be legislative instruments and will be subject to the requirements of the Legislation Act 2003, including parliamentary scrutiny, oversight, disallowance and sunsetting. The existing regulations made under the Product Stewardship Act 2011, that is, the Product Stewardship (Televisions and Computers) Regulations 2011, the Product Stewardship (Voluntary Arrangements) Instrument 2012 and the Product Stewardship Regulation 2012 will be repealed and there will be new rules proposed to be made in respect of these product stewardship arrangements.
Overview of the RWR Consequential and Transitional bill
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In introducing the RWR Consequential and Transitional bill to Parliament, the Minister stated that it is:
…a companion bill to the [RWR bill]. It will facilitate the smooth transition of the existing provisions of the [Product Stewardship Act] into the new legislative framework.
This bill provides for the repeal of the [Product Stewardship Act] to make way for the improved regulation of product stewardship within the framework of the [RWR bill].
This consequential and transitional provisions bill will do this by ensuring that arrangements to manage waste are transitioned appropriately, without disruption to industry or to the public.
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The RWR Consequential and Transitional bill contains the following schedules:
Schedule 1 repeals the Product Stewardship Act, which would be replicated by Chapter 3 of the RWR bill;
Schedules 2 and 3 provide for the continuation of existing accredited voluntary and coregulatory arrangements, so that administrators of these schemes can continue their operations without re-applying for approvals (for instance, the National Television and Computer Recycling Scheme).
Overview of the RWR General, Customs and Excise bills
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In introducing these bills to Parliament, the Minister stated that the RWR General, Customs and Excise bills set out an 'appropriate cost recovery mechanism for activities associated with regulating the export of certain waste materials', as set out in the RWR bill.
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The RWR General bill applies to 'fees that recover the department's costs of those activities provided directly to relevant businesses—activities such as processing export licence applications'. The Minister stated that these fees would be developed in consultation with affected businesses, and that these costs would not be 'more than the likely cost of delivering this activity'.
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The RWR Customs and Excises bills set out arrangements for charges when they are considered a duty of customs and excise respectively. These bills are intended to mirror provisions of the RWR General bill, and 'have the same operative function and effect'.
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According to the Minister, these three bills do not themselves 'set the amount of the charges and will not impose any financial impacts' or specify 'the persons liable or exempt from paying them', which 'will be set in regulations'.
Other recent Commonwealth initiatives
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The Commonwealth announced several new complementary initiatives in waste management and recycling on 6 July 2020. These include:
$190 million for a Recycling Modernisation Fund, which aims to generate $600 million in private investment in the recycling industry, the creation of 10,000 jobs, and enable the transformation of Australia's capacity to process and recycle waste products;
$35 million to implement National Waste Policy Action Plan commitments; and
$24.6 million to improve data on national waste, to track recycling outcomes and national waste targets.
Comment of the Scrutiny of Bills Committee
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The Senate Standing Committee for the Scrutiny of Bills (Scrutiny Committee) commented on several elements of the RWR bill, which will be discussed in turn.
Delegated legislation
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The Scrutiny Committee raised concerns about some 'significant elements of the legislation that are left to be determined by delegated legislation', such as:
what kind of waste material will be 'regulated waste material' for the purposes of the new regime for the regulation of the export of waste materials, as well as the conditions that will apply to the export of waste material;
the accreditation of voluntary arrangements;
the scheme for the management of co-regulatory arrangements, including who is a liable party and the outcomes and matters to be dealt with by co-regulatory arrangements;
the requirements for mandatory product stewardship;
matters relating to audits undertaken under the bill;
the functions and powers of authorised officers;
the requirements for making and retaining records;
the requirements for providing and disseminating information;
the charging of fees; and
the imposition of a waste management charge, including when a charge will be due, penalties for non-payment of the charge and the review of decisions made under the rules.
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Regarding the appropriateness of delegated legislation, the Scrutiny Committee noted its ongoing concerns with 'framework bills', which:
…contain only the broad principles of a legislative scheme and rely heavily on delegated legislation to determine the scope and operation of the scheme. As the detail of the delegated legislation is generally not publicly available when Parliament is considering the bill, this considerably limits the ability of Parliament to have appropriate oversight over new legislative schemes.
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The Scrutiny Committee concluded that:
The committee draws its scrutiny concerns to the attention of senators and leaves to the Senate as a whole the appropriateness of leaving significant elements of the proposed new legislative framework for the management of the environmental and human health and safety impacts of products and waste material to be determined in delegated legislation.
The committee also draws this matter to the attention of the Senate Standing Committee for the Scrutiny of Delegated Legislation.
Other concerns raised by the Scrutiny Committee
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The Scrutiny Committee noted a number of other concerns with the RWR bill, including that provisions would:
reverse of the evidential burden of proof;
impose strict liability for some offences;
allow broad delegation of investigatory powers;
create delegated legislation that would not be subject to parliamentary disallowance;
give certain officials immunity from civil liability for decisions;
legislate for computerised decision making to administer elements; and
allow the incorporation of external materials from time to time.
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In raising these matters, the Scrutiny Committee sought the Minister's advice on several aspects of the bill and some proposed amendments, and also brought these concerns to the attention of senators.
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The Scrutiny Committee also raised concerns about the RWR Customs, Excise and General bills, particularly the charges they would impose 'in relation to regulating the export of certain waste materials' in delegated legislation. In raising these concerns, the Scrutiny Committee brought these issues to the attention of the Senate, individual senators, and the Senate Committee for the Scrutiny of Delegated Legislation.
Acknowledgement
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The committee thanks all the organisations that participated in this inquiry by making submissions or giving evidence at the public hearing, particularly given the committee's short timeframe for reporting its findings to the Senate.