Chapter 1

Chapter 1

BACKGROUND AND OPERATION OF THE COMMITTEE

Introduction

1.1       The Senate Standing Committee for the Scrutiny of Bills was established on
19 November 1981. On 25 November 1991, the Committee held a seminar to mark the tenth anniversary of its establishment. The published proceedings of that seminar,
Ten Years of Scrutiny, includes a paper presented by the then Chairman of the Committee, Senator Barney Cooney. In that paper, Senator Cooney provided an update to a paper on the early work of the Committee, The Operation of the Australian Senate Standing Committee for the Scrutiny of Bills 1981-1985,[1] that was given in 1985 by his predecessor as Chairman, Senator Michael Tate. These papers provide an excellent overview of the early work of the Committee.

1.2       In October 1993, the Committee published a report on its work during the
36th Parliament.[2] Similar reports have been published on the work of the Committee during each subsequent Parliament.[3] These documents are the main source of information for persons wishing to know more about the work of the Committee.

1.3       In a similar manner, this report outlines the work of the Committee during the 41st Parliament. In this context, it is useful to first re-examine the main features of the operation of the Committee, including the background to its establishment.

 

Report of the Standing Committee on Constitutional and Legal Affairs

1.4       On 9 June 1978, on the motion of then Senator Fred Chaney, the Senate referred to its then Standing Committee on Constitutional and Legal Affairs the following matter:

The desirability and practicability of referring all legislation introduced into the Parliament to a committee of the Senate for the purpose of examining the legislation and reporting to the Senate as to whether there are provisions in the Bills, whether by express words or otherwise, which:

      1. place the onus of proof on a defendant in a criminal prosecution;

      2. confer a power of entry on to land or premises other than by warrant issued according to law;

      3. confer a power of search of the subject, land or premises other than by warrant issued according to law;

      4. confer a power to seize goods other than by warrant issued according to law;

      5. purport to legislate retrospectively;

      6. delegate authority to amend any Act of the Parliament of the Commonwealth, or to create exemptions from the operation of any such Act, by means of subordinate legislation;

      7. authorise administrative decisions affecting the rights and liberties of the subject without prescribing objective criteria to govern such decisions or without providing a right of appeal to a Court or competent Tribunal;

      8. affect the liberty of the subject by controls upon freedom of movement, freedom of association, freedom of expression, freedom of religion or freedom of peaceful assembly; or

      9. otherwise trespass unduly on personal rights and liberties, or make the rights and liberties of citizens dependent upon administrative rather than judicial decisions.[4]

1.5       Following its inquiry, the Constitutional and Legal Affairs Committee tabled its Report on Scrutiny of Bills on 23 November 1978.[5] That report recommended the establishment of a Parliamentary Joint Committee to highlight provisions in bills that had an impact on persons, either by interfering with their rights, or by subjecting them to the exercise of undue delegations of power. The Committee recommended that, in particular, this new Committee should examine the clauses of all bills introduced into the Parliament to determine whether, by express words or otherwise, they:

  1. trespass unduly on personal rights and liberties;

  2. make rights, liberties and obligations unduly dependent on insufficiently defined administrative powers or non-reviewable administrative decisions;  or

  3. inappropriately delegate legislative power or insufficiently subject its exercise to parliamentary scrutiny.

 

Establishment of the Scrutiny of Bills Committee

1.6       As a consequence of the Committee’s report, a Standing Committee for the Scrutiny of Bills was established on 19 November 1981, by resolution of the Senate.[6] Its establishment was by no means easy and owed much to the work of its first Chairman, the late Senator Alan Missen. As Professor Dennis Pearce, the Committee’s first legal adviser, told the Committee’s tenth anniversary seminar:

The resistance... was quite extraordinary. The Government had, pursuant to the ordinary arrangements that existed, the standard arrangements, responded to the [Constitutional and Legal Affairs] Committee’s proposal and it opposed the establishment of this Committee. But the resistance to this suggestion was so great that you even find the Opposition refusing to allow Senator Missen to table the Government’s response to the Legal and Constitutional Affairs Committee’s proposals. And this was done not once but twice.

It really was quite remarkable that the Senate seemed to be worried by the thought that it might be able to engage in informed legislating. There was a problem in relation to the joint committee proposal and there was a problem in relation to the timing proposal. But they seemed to be used as much as anything to resist this notion that a parliamentary committee should actually begin to identify problems relating to legislation that were recognised as being inappropriate in delegated legislation.

Two more years went by and Senator Missen again moved to establish the Committee. He had had various forays along the way. He was supported, very strongly, in November 1981, by Senator Tate. The Government was still opposed to this proposal - this radical and wicked proposal. A compromise was suggested by Senator Hamer that the Committee should have a six-month probationary period, in effect, and that the work should be done by the Constitutional and Legal Affairs Committee. With that compromise, there was an acceptance of the Committee, and it finally did get under way.[7]

1.7       Professor Pearce’s account of the establishment of the Committee was supported by the Hon Fred Chaney, formerly the Federal member for Pearce and a former member of the Senate:

I think that those who are concerned about the parliamentary institution can learn something from the history of this Committee. One thing is that a relatively obscure backbencher can have an influence on the way the institution operates. When I put forward this proposition, originally in a speech in February 1978 and then in a formal motion later in the same year, I had been in the Senate for less than four years and it was possible to get one’s colleagues to focus on a proposal for change. We used the existing committee system (which again had been forced upon the Government of the relevant day by senators) to examine this proposition. Indeed, I had a wonderful and unusual chance to see both sides of the operation.

Shortly after the Senate committee commenced its consideration of the resolution [relating to the establishment of the Committee], I was appointed to the Ministry. This, some people say, is on the basis that, if you are enough trouble, that is one way to shut you up. I then sat in the Fraser Cabinet room as a non-Cabinet Minister and listened to the discussion of the proposition that we should have this Committee as was recommended by the Constitutional and Legal Affairs Committee. I then was in the embarrassing position of having to come into the Senate to defend a decision which I totally disagreed with: to oppose the establishment of the committee that I had advocated.[8]

I must say that it gave me great pleasure to find that senators really were not terribly impressed by the Executive Government’s decision. They, in fact, took it into their own hands to establish this Committee, originally through putting its functions into the Constitutional and Legal Affairs Committee. I think the first thing to remember about it is that this was done not at the behest of or with the approval of the Executive Government, but against the objection of the Executive Government. Of course, the Executive Government’s concern was that the legislative process would be slowed down, and effective and efficient government would be impeded.[9]

1.8       Though the Constitutional and Legal Affairs Committee had recommended that a joint committee be established, the Scrutiny of Bills Committee has always been a Senate Committee. As noted above (paragraph 1.6), for the first six months of its operation it had the same membership as the Constitutional and Legal Affairs Committee. On 25 May 1982, the Senate finally resolved to establish a distinct Scrutiny of Bills Committee.[10] 

1.9       For the first six years of its operation, the Committee existed by virtue of a Senate resolution and later, of a Senate Sessional Order. The relevant resolution or Sessional Order established the Committee and set out its terms of reference and its method of operation. A consequence of this approach was that the Committee had to be re-established at the commencement of each new Parliament. However, on
17 March 1987, the Committee became a permanent feature of the Senate Committee system, with the adoption of a new Senate Standing Order 36AAA.[11] This was in similar terms to the previous resolutions and Sessional Orders. When the Senate Standing Orders were re-numbered, it became Standing Order 24, which currently governs the operation of the Committee.

 

Senate Standing Order 24

1.10         Senate Standing Order 24 provides that:

At the commencement of each Parliament, a Standing Committee for the Scrutiny of Bills shall be appointed to report, in respect of the clauses of bills introduced into the Senate, and in respect of Acts of the Parliament, whether such bills or Acts, by express words or otherwise:

      1. trespass unduly on personal rights and liberties;

      2. make rights, liberties or obligations unduly dependent upon insufficiently defined administrative powers;

      3. make rights, liberties or obligations unduly dependent upon non-reviewable decisions;

      4. inappropriately delegate legislative powers; or

      5. insufficiently subject the exercise of legislative power to parliamentary scrutiny.[12]

1.11         The Committee has six members, three of whom are members of the government party, nominated by the Leader of the Government in the Senate, and three of whom are members of non-government parties (as nominated by the Leader of the Opposition in the Senate or by any minority groups or independent Senators).

1.12         The Chair of the Committee is a member appointed on the nomination of the Leader of the Opposition in the Senate. The Chair may from time to time appoint a member of the Committee to be Deputy Chair. The Chair, or Deputy Chair when acting as Chair, has a casting vote when votes on a question before the Committee are equally divided. However, the relative numbers of the political groupings represented on the Committee has proved to be of little or no significance to the Committee’s operation. The culture of the Committee is, and always has been, non-partisan.

1.13         Standing Order 24 sets out various other matters, including the Committee’s power to appoint subcommittees and its power to send for persons and documents. One of the most significant powers of the Committee is that of appointing a legal adviser.

 

The Committee’s legal adviser

1.14         Since its inception, the Committee has always taken the opportunity to engage an eminent legal adviser to assist it in its work. As noted above, the Committee’s first legal adviser was Professor Dennis Pearce. However, its longest-serving legal adviser is the current appointee – Emeritus Professor Jim Davis, formerly of the ANU Law Faculty – who has been with the Committee since 1983. Professor Davis’s tenure was interrupted by a 13 month leave of absence, during which time the Committee was assisted by the late Emeritus Professor Douglas Whalan, also of the ANU Law Faculty.

1.15         At the tenth anniversary seminar, Senator Cooney noted the Committee’s great debt to its legal advisers. He recorded the Committee’s appreciation ‘for the hours of hard work, largely undertaken over weekends, put in by these three eminent legal minds’ and also expressed the Committee’s gratitude ‘to the Law Faculty of the Australian National University, from whence they have all been poached’.[13]

 

The operation of the Committee

1.16         As outlined above, the operation of the Committee is governed by Senate Standing Order 24. Within the limits set out in that Standing Order, the Committee has evolved a method of operation that is now well-established.

1.17         Copies of all bills introduced in either House of the Parliament, including private Member’s or private Senator’s bills, are provided to the Committee by the Friday of each sitting week. A copy of each bill, together with its explanatory memorandum and second reading speech, is then forwarded to the Committee’s legal adviser. The legal adviser examines each bill against the five principles set out in Standing Order 24 and provides a written report to the Committee by the following Monday. This report draws the attention of members of the Committee, and of the Committee Secretariat, to clauses of any of the bills that appear to infringe one or more of the five principles.

1.18         Since the 39th Parliament, the Committee Secretariat has also systematically examined parliamentary amendments to bills. Amendments agreed to by either the House of Representatives or the Senate, as noted in the relevant Parliamentary Debates and recorded in the Votes and Proceedings of the House of Representatives or the Journals of the Senate, are also evaluated against the five principles set out in Standing Order 24 and, where appropriate, drawn to the Committee’s attention.

The Alert Digest

1.19         On the basis of the legal adviser’s report, the Secretariat prepares a draft Alert Digest, which is considered by the Committee at its regular meeting on the Wednesday morning of each Senate sitting week. The Alert Digest contains a brief outline of each of the bills introduced in the previous sitting week, and any amendments made to bills in that week. It sets out any comments the Committee wishes to make in relation to a particular bill or amendment. Comments are usually made by reference to the relevant principle. The Alert Digest is tabled in the Senate on the Wednesday afternoon or the Thursday morning of each sitting week.

1.20         Where concerns are raised in an Alert Digest, correspondence on the matter is forwarded to the Minister, Member, or Senator responsible for the bill or the amendment, on the Thursday following the tabling of the Alert Digest. This correspondence invites the Minister, Member, or Senator to respond to the Committee’s concerns. The Committee requests that any response be received in sufficient time for it to be circulated to members for consideration prior to the next Committee meeting.

Committee Reports

1.21         When correspondence is received from a Minister, Member, or Senator, responding to a concern raised in an Alert Digest, the Committee includes this response in a Report to the Senate. The Report contains the relevant extract from the Alert Digest, the text of the Minister’s, Member’s, or Senator’s response, and any further comments or requests for information the Committee may wish to make as a result. As with the draft Alert Digests, the draft Reports are considered at the Committee’s regular meeting. The Committee agrees on their content and they are then presented to the Senate on the Wednesday afternoon or the Thursday morning of each sitting week.

1.22         The Committee wishes to place on record its thanks to Ministers, Parliamentary Secretaries, Members, and Senators for the promptness and comprehensiveness of the responses provided during the 41st Parliament. The co-operation and goodwill shown has greatly assisted the Committee in the effective performance of its duties.

1.23         Occasionally the Committee also produces reports on matters specifically referred to it by the Senate. For example, during the 41st Parliament the Committee held an inquiry and tabled a report on Entry, Search and Seizure Provisions in Commonwealth Legislation (see the Committee’s Twelfth Report of 2006, which is discussed further in Chapter 7).

Publication on the Internet

1.24         Copies of Alert Digests and Reports are provided to all Senators (on request), relevant Ministers, and other interested persons and institutions. They are also available for download at www.aph.gov.au/senate_scrutiny.

Monitoring of penalty provisions for ‘information’ offences

1.25         In addition to its legislative scrutiny work, as outlined above, during the
41st Parliament the Committee also monitored the penalties specified for ‘information’ offences in Commonwealth legislation. In its Eighth Report of 1998, the Committee reported on the appropriate basis for penalty provisions where legislation created offences involving the giving or withholding of information. This matter was referred to the Committee after debate in the Senate about the appropriateness of specifying a penalty of imprisonment for failing to provide information to the Productivity Commission – an organisation that provided the Government with general advice on microeconomic reform.

1.26         In its report, the Committee recommended that the Attorney-General develop more detailed criteria to ensure that the penalties imposed for such offences were more consistent, more appropriate, and made greater use of a wider range of
non-custodial penalties. On 14 December 1998, the Minister for Justice and Customs responded to the Committee, advising that the issue of penalties for offences of this type would be dealt with progressively as part of the development of the Commonwealth Criminal Code.

1.27         Since the publication of its Eighth Report of 1998, the Committee has continued to monitor the penalties imposed for such offences. Imprisonment continues to be provided for as an appropriate penalty for such offences on some occasions. During the 41st Parliament it was specified as a penalty in a number of bills, including the Anti-Money Laundering and Counter-Terrorism Financing Bill 2006, the Anti-Terrorism Bill (No. 2) 2005, the ASIO Legislation Amendment Bill 2006, the Building and Construction Industry Improvement Bill 2005, the Corporations (Aboriginal and Torres Strait Islander) Bill 2005, the Environment and Heritage Legislation Amendment Bill (No. 1) 2006, the Financial Sector Legislation Amendment (Discretionary Mutual Funds and Direct Offshore Foreign Insurers) Bill 2007, the International Trade Integrity Bill 2007, the Law Enforcement Integrity Commissioner Bill 2006, the Migration Amendment (Sponsorship Obligations) Bill 2007, the Parliamentary (Judicial Misbehaviour or Incapacity) Commission Bill 2007, and the Social Security and Other Legislation Amendment (Welfare Payment Reform) Bill 2007. 

Monitoring of national scheme legislation

1.28         During the 41st Parliament, Committee Alert Digests also monitored the introduction of Commonwealth bills that proposed to give effect to national schemes of legislation (ie. legislation which is uniform, or substantially uniform, and has an application in more than one Australian jurisdiction) or decisions reached at Ministerial Councils. During the 41st Parliament, the only such bill was the Australian Energy Market Amendment (Gas Legislation) Bill 2006.

Monitoring of standing appropriations

1.29         The Committee’s Fourteenth Report of 2005 examined accountability and standing appropriations. Standing appropriations, often referred to as ‘special appropriations’ enable entities to spend money from Commonwealth revenue, subject to meeting legislative criteria. Their significance from an accountability perspective is that, once they have been enacted, the expenditure they involve does not require regular parliamentary approval and, therefore, escapes parliamentary control. They are not subject to approval through the standard annual appropriations process.

1.30         The Committee noted that the number of special appropriations and the amount of expenditure involved had grown steadily over the life of the Commonwealth, with standing appropriations accounting for more than 80% of all Commonwealth Government expenditure at the time of reporting. In 2002-03 they authorised $223.2 billion of expenditure. 

1.31         In a report on the financial management of special (standing) appropriations in November 2004, the Australian National Audit Office found widespread illegalities and lack of accountability and control in the management of these appropriations. The Audit Office concluded that ‘there are many important considerations of appropriate accountability, including transparency, in relation to the Parliament’. The report continued:

10.     Given the fundamental importance of appropriations to Parliamentary control over expenditure, changes need to be made to secure proper appropriation management in the Commonwealth...

11.     Achieving the necessary improvements to the management of Special Appropriations will require greater understanding of, and increased care and attention to, legislative requirements and appropriation management practices.[14]

1.32         The Committee noted, however, that ‘no particular scrutiny is given by the Parliament to bills containing standing appropriations. Such provisions in bills normally pass without comment.’[15]

1.33         The Committee concluded that:

The appropriation of money from Commonwealth revenue is a legislative function. The committee considers that, by allowing the executive government to spend unspecified amounts of money for an indefinite time into the future, provisions which establish standing appropriations may, depending on the circumstances of the legislation, infringe upon the committee’s terms of reference relating to the delegation and exercise of legislative power.[16]

1.34         As such, the Committee determined that, as part of its standard procedures for reporting on bills, it should draw senators’ attention to the presence in bills of standing appropriations. It does so under principles (1)(a)(iv) and (1)(a)(v) of its terms of reference, which require the Committee to report on whether bills:

(iv)     inappropriately delegate legislative power; or

(v)      insufficiently subject the exercise of legislative power to parliamentary scrutiny.[17]

1.35         In scrutinising standing appropriations, the Committee looks to the explanatory memorandum to the bill for an explanation of the reason for the standing appropriation. Where circumstances warrant, the Committee will also seek from the responsible Minister an explanation justifying the inclusion of the provision and the exclusion of the appropriation from subsequent parliamentary scrutiny and renewal through the ordinary appropriations process. In addition, a running list of bills introduced with standing appropriations during the 41st Parliament has been included in each Alert Digest since December 2005.

Consensus

1.36         Since its inception, the Committee has operated in a non-partisan and apolitical way, on a consensus basis. In reporting to the Senate, the Committee’s practice is to express no concluded view on the provisions in a bill, but rather to advise Senators (and other readers of its reports) of the risk that particular provisions may infringe one or more of the principles in Standing Order 24. In essence, the Committee sees its task as drawing the Senate’s attention to provisions in legislation which may infringe people’s civic entitlements. Whether the legislation should be passed as introduced, or amended, is properly a matter for the Senate to decide.

 

The Committee’s workload

1.37         Each year the Committee analyses approximately 200 to 250 bills. The following table sets out the bills and amendments considered during the
41st  Parliament.

Year

Bills considered

Bills commented on

Amended bills considered

Amended bills commented on

Digests tabled

Reports tabled

2004*

60

22

2

2

2

2

2005

199

86

4

4

15

14

2006

197

94

5

3

15

13

2007**

213

106

33

8

12

10

Total 41st

Parliament

669

308 (46 %)

44

17 (39%)

44

39

 *  From November 2004.

** To October 2007.


The Committee’s effectiveness

1.38         Determining the Committee’s effectiveness depends on which particular impact is being measured. Its effectiveness can be assessed quantitatively, in terms of the number of bills commented on, ministerial responses received, and so on. These details are set out in Appendix III of this report. In addition, each Alert Digest contains a running index of bills commented on by the Committee, which indicates whether a ministerial response was sought and, if so, whether or not one was received.

1.39         Further measures of effectiveness might be amendments moved or amendments passed in respect of provisions of bills on which the Committee has made comment; or amendments made to explanatory memoranda in response to concerns expressed by the Committee. Examples of such amendments are included throughout this report in the commentary on specific bills. Additional examples include:

1.40         While the indicators of effectiveness outlined above are relatively easy to quantify, other measures of effectiveness are less tangible. For example, the impact that the Committee has in preventing issues from arising in the first place, rather than drawing attention to them once they have arisen. Many of the concerns raised by the Committee are discussed in the Drafting Directions issued by the First Parliamentary Counsel and all drafters are required to comply with these directions. As such, it might be argued that the Committee is effective in preventing problems from arising in the first place, but the extent to which this occurs is impossible to quantify. 

1.41         More impressionistic indicators of the Committee’s effectiveness are comments made about it by people who have experienced its work. For example, in 1998 Senator the Hon Robert Ray, noting that he had originally voted against the establishment of the Committee, indicated that:

my concern at that time was not that bills should be scrutinised but that the job would be delegated to staff and consultants and that senators would merely rubber stamp the recommendations that came through.

What became clearly obvious from the work on both sides of the chamber on this committee as it evolved in the 1980s is that the committee took its task very seriously. It looked at legislation. I found it most valuable as a minister when we had legislation up before the chamber. Quite often, matters brought up by the Standing Committee for the Scrutiny of Bills had not been thought of by the minister in scrutinising the legislation. It was quite a useful tool for a minister to have some other body away from departmental advice evaluating the legislation and pointing out weaknesses in it. So I have to say – this is very difficult for me – that back in 1981 and 1982 I was probably in error in voting against it.[18]

 

Explanatory memoranda

1.42         During the 41st Parliament, the Committee continued to raise concerns about the quality of explanatory memoranda accompanying bills. The Committee relies on the explanatory memorandum to explain the purpose and effect of the associated bill and the operation of its individual provisions. In particular, the Committee expects that an explanation will be given for any provision within the bill that appears to test or infringe the principles outlined in Standing Order 24 and that the explanatory memorandum will provide reasons or justifications for this.

1.43         During the previous Parliament, the Committee dedicated its Third Report of 2004 to the discussion of explanatory memoranda. As part of that report, the Committee made five recommendations aimed at improving the quality of explanatory memoranda. The Committee recommended that:

      1. the Department of the Prime Minister and Cabinet amend the Legislation Handbook to provide further guidance on the matters that the Committee considers should be addressed in explanatory memoranda;

      2. the Department of the Senate develop a set of guidelines to assist Senators in the preparation of private Senators’ bills;

      3. information relevant to the preparation of explanatory memoranda currently contained in the Legislation Handbook, Legislation Circulars and Office of Parliamentary Counsel Drafting Directions, be consolidated into one primary source of information, namely the Legislation Handbook;

      4. an appropriately qualified person should check the explanatory memorandum accompanying a bill before the bill is introduced into the Parliament, so as to ensure that it fully explains the effect and operation of the proposed legislation and complies with the requirements contained in the Legislation Handbook, as amended; and

      5. consideration be given to developing a course to train departmental officers in the preparation of explanatory memoranda.[19]

1.44         In March 2007, the Government tabled its response to the Committee’s Third Report of 2004, agreeing to three of the four recommendations to Government made by the Committee. In responding to the report, the Government:

1.45         At the end of the 41st Parliament, the Government had not yet implemented these commitments. The Government did not agree to the development of a training course for departmental officers on the preparation of explanatory memoranda, but noted that consideration would be given to this recommendation should standards not improve.

1.46         In response to the Committee’s second recommendation, the Department of the Senate developed a set of guidelines - Preparing Private Senators’ Bills, Explanatory Memoranda and Second Reading Speeches. A Guide for Senators - to assist Senators in the preparation of private bills. Senators were alerted to the existence of the guidelines in October 2004. The guidelines are available from the Clerk-Assistant, Senate Procedure Office and on the intranet.

1.47         The Committee recognises that private Senators and Members do not generally have access to the resources of departments and agencies to assist in the development of explanatory material. Nevertheless, the Committee expects that all bills should be of an appropriate standard, and accompanied by explanatory material. The Committee would encourage the Senate and the House of Representatives to explore options for better supporting private Members and Senators in the production of such documentation.

1.48         This report now turns to more detailed consideration of the work of the Committee during the 41st Parliament. This will be discussed by considering how the Committee tested bills coming before it against the five principles that govern its work.

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