House of Representatives Committees

Environmental Management of Commonwealth Land

CHAPTER 1: THE REVIEW OF ENVIRONMENTAL MANAGEMENT OF COMMONWEALTH LAND

The Committee's Review of the Audit Report

1.1 On 24 June 1996 the Auditor-General's Report No. 31 of 1995-96 entitled Environmental Management of Commonwealth Land: Site Contamination and Pollution Prevention was tabled in the House of Representatives. The audit was conducted between September 1995 and January 1996.

1.2 The purpose of the audit was to examine the environmental management mechanisms in place across some of the major Commonwealth land management and oversighting entities, including the Departments of Defence, Administrative Services, Transport and Regional Development, and Communications and the Arts. These portfolios administer approximately $4.35 billion or 56% of the total value of Commonwealth land. The audit also looked at the policy development and coordination role of the Commonwealth Environment Protection Agency (CEPA).

1.3 More specifically, the objectives of the audit were to assess the efficiency, economy, administrative effectiveness and the associated accountability arrangements in relation to the environmental management of Commonwealth land holdings. The Australian National Audit Office (ANAO) did not set out to apply current environmental standards to past Commonwealth performances, but it was intended that the audit would encourage the development of better practice by drawing on lessons learned from past practices.

1.4 The report made 18 recommendations aimed at improving environmental management of Commonwealth land and at bringing the Commonwealth more into line with current international best practice. The ANAO summarised its findings in the following way:

[1]

1.5 The audit report included a number of ANAO's key findings.

Commonwealth entities can make significant improvements in their environmental performances by adopting and adapting developments in better practice and environmental risk management.
There is no specific Commonwealth legislation or formal policy to guide Commonwealth land management entities when they are dealing with environmental matters such as pollution prevention and site contamination. This is a major constraint on departments and entities seeking to establish priorities and actions in line with best practice.
Commonwealth entities are generally not bound by State environmental legislation or local government planning controls. The absence of Commonwealth legislation contrasts with legislative and policy developments at the State government level.
The National Environment Protection Council could provide a forum for addressing Commonwealth-State issues relating to the management of site contamination, and could facilitate a national approach towards better practice.
Sufficient priority has not been given to addressing potential health, environmental and financial risks. Commonwealth land management entities could make significant improvements in their environmental management by developing management systems consistent with better industry practice.
Although the Commonwealth does have a policy in relation to unexploded ordnance (UXO), defence resources allocated to these issues are not sufficient to achieve the policy within a reasonable time frame.
Departmental oversight of environmental risk management by government business enterprises (GBEs) is patchy and inconsistent. Departments could become more proactive in oversighting the environmental issues of GBEs within their portfolios.

1.6 On 27 June 1996 the House of Representatives referred the Auditor-General's report on environmental management of Commonwealth land to the House of Representatives Standing Committee on Environment, Recreation and the Arts for consideration. The Committee sought and received submissions from the audited departments and State and Local Governments; the submissions are listed in Appendix A. The Committee also held three public hearings with the audited departments and the ANAO (Appendix B).

Responses by Departments

1.7 All the audited departments agreed or agreed in principle with the recommendations in the audit report and action had been taken to implement many of the recommendations. Appendix C summarises the responses by departments to the audit recommendations and action taken to implement the recommendations.

1.8 There were four main issues arising from the responses to the audit report and submissions to the Committee.

Although the CEPA agreed to all eighteen relevant recommendations, it responded that it would not undertake the tasks recommended in the report due to changes in its priorities made in response to budget allocations [2]. In particular, the CEPA would not be working on developing a Commonwealth policy on contaminated sites.
The departments maintained that they observed the intent of State legislation and regulations regarding environmental management. The States and Territories asserted that the Commonwealth should abide by State and Territory laws regarding the management of contaminated land.
The Departments of Communications and the Arts and of Transport and Regional Development agreed in principle to recommendations aimed at improving the oversight arrangements of departments over GBEs. The departments indicated that the individual GBEs are best placed to manage and monitor environmental issues on a day-to-day basis.
The Department of Defence agreed in principle with the recommendation regarding UXOs and advised that the Commonwealth has a policy on the management of UXOs. However, the ANAO was concerned that more resources were needed to appropriately assess and deal with the identified risks.

These issues are discussed further in Chapter 2.

The Environmental Management of Commonwealth Land - The Current Situation

1.9 The ANAO viewed the CEPA as being responsible for policy development on contaminated sites and noted that, at present, there is no specific Commonwealth policy on the environmental management of Commonwealth land. The audit report suggested that the lack of a clear Commonwealth policy on the management of contaminated sites has meant that Commonwealth departments and agencies have given this a low priority, and there has been no incentive to manage site contamination issues consistently.

1.10 The audit report noted that, in the absence of a Commonwealth policy, the Australian and New Zealand Guidelines for the Assessment and Management of Contaminated Sites (ANZECC/NHMRC Guidelines) was published in 1992 to form the basis for action in relation to Commonwealth contaminated sites. [3] A consultative process was entered into between Commonwealth, State, Territory and New Zealand public agencies, business organisations and conservation groups to develop the ANZECC/NHMRC Guidelines. The main purpose of the guidelines is to:

[4]

The ANAO considered that, although the ANZECC/NHMRC Guidelines are important in the policy process, they are primarily designed to provide guidance once contamination has occurred. [5] Many Commonwealth and State agencies, however, follow the ANZECC/NHMRC Guidelines to assess and manage contaminated sites.

1.11 Some Commonwealth agencies are planning to develop environmental management systems that comply with the International Standards Organisation (ISO) 14000 series of environmental management standards. Although the standards are voluntary, some Australian corporations and governments consider it important to channel their efforts towards an internationally accepted set of criteria. ISO 14001 specifies the core elements of an environmental management system: environmental policy, planning, implementation, operation, checking, corrective action, and management review.

1.12 There is no Commonwealth legislation specifically dealing with the environmental management of Commonwealth land. Commonwealth Acts that are relevant to environmental management include:

Environment Protection (Impact of Proposals) Act 1974 - the Department of the Environment, Sport and Territories (DEST) can become actively involved when an environmentally significant Commonwealth action is being considered (but as the audit report notes, this Act has rarely been applied to site assessment and remediation activities);
Occupational Health and Safety (Commonwealth Employment) Act 1991 - employers must take all reasonably practicable steps to protect the health and safety at work of employees, and to ensure that innocent third parties at or near a workplace under the Commonwealth's control are not exposed to risk to their health or safety;
Australian Heritage Commission Act 1975 - the Australian Heritage Commission provides advice on the management and disposal of Commonwealth assets;
Audit Act 1901 - a Commonwealth officer who performs duties in a negligent manner and causes or contributes to the loss, deficiency, destruction or damage of Commonwealth property is liable to pay to the Commonwealth an amount equal to the value of the property; and
National Environment Protection Council Act 1994 - National Environment Protection Measures (NEPMs) relating to environmental management can bind the Commonwealth if approved by the National Environment Protection Council (NEPC).

1.13 Most States have environmental legislation and regulations that deal with the contaminated sites and land management issues confronting Commonwealth land managers. However, Commonwealth entities are generally not bound by State legislation under the Constitution. Immunity from State laws has been reduced for some Commonwealth entities, while for others it has been extended. The ANAO claimed that, although Commonwealth entities are generally not bound by State laws, State environment planning and development approvals are important for Commonwealth entities seeking to dispose of properties on the private market. [6] Cooperation and coordination between Commonwealth land managers and the States is discussed further in Chapter 2.

The Extent of Commonwealth Contaminated Sites

1.14 The ANZECC/NHMRC Guidelines describe a contaminated site as one at 'which hazardous substances occur at concentrations above background levels and where assessment indicates it poses, or is likely to pose an immediate or long term hazard to human health or the environment'. [7] A range of past and present Commonwealth activities could have posed, and may be continuing to pose, risks to the environment and human health. Such activities include artillery practice, military training, and the handling, storage and disposal of hazardous substances.

1.15 The potential for contamination to have occurred on Commonwealth sites is difficult to assess, and the exact number of contaminated sites in Australia is unknown. The audit report stated that estimates of possibly contaminated sites in Australia range from 10 000 to 60 000. [8] The States also claimed that it is difficult to estimate the number of sites that are contaminated. [9]

1.16 The Department of Transport and Regional Development stated that they did not have a full understanding of their contaminated sites or those of their GBEs:

[10]

On the other hand, representatives of the Federal Airports Corporation (FAC) and Australia National (AN) claimed that they were well aware of their contaminated sites. [11] An audit of all DAS properties was underway to determine the contamination issues at each site. The Department of Administrative Services (DAS) had commenced an assessment of contamination at all its sites and was developing a database to include information about the contamination issues at each site. [12]

1.17 With incomplete information about the scope of contaminated sites, the potential liability for the Commonwealth is unknown. With land valued at $7.75 billion, and potential risks from a range of activities involving hazardous substances, it is incumbent on the Commonwealth to pursue best practice in the environmental management of its land in order to avoid future liabilities. It also needs to be aware of the extent of contamination to ensure that any future land disposals proceed smoothly.

Footnotes

[1] Transcript, 2 December 1996, p 92.

[2] Commonwealth Environment Protection Agency Submission (No 3), p 2.

[3] Australian and New Zealand Environment and Conservation Council (ANZECC), National Health and Medical Research Council (NHMRC), Australian and New Zealand Guidelines for the Assessment and Management of Contaminated Sites, 1992.

[4] ANZECC/NHMRC Guidelines, Forward.

[5] Australian National Audit Office, Audit Report No. 31 1995-96, Environmental Management of Commonwealth Land: Site Contamination and Pollution Prevention, p 12.

[6] Australian National Audit Office, Audit Report No. 31 1995-96, Environmental Management of Commonwealth Land: Site Contamination and Pollution Prevention, p 10.

[7] ANZECC/NHMRC Guidelines, p 2.

[8] Australian National Audit Office, Audit Report No. 31 1995-96, Environmental Management of Commonwealth Land: Site Contamination and Pollution Prevention, p 3.

[9] NSW Parliamentary Library Research Service, Contaminated Land in New South Wales, April 1996, p 3; G Rowe and S Siedler (eds), Contaminated Sites in Australia: Challenges for Law and Public Policy, p 111.

[10] Transcript, 4 November 1996, p 12.

[11] Transcript, 4 November 1996, p 12.

[12] Transcript, 4 November 1996, p 26; Department of Administrative Services Submission (No 4), p 3.