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4.2 - Community participation is limited to process – they do not feel heard

The processes of the EPBC Act limit avenues for community participation in decision-making. For example, participation in the process for listing species is largely limited to matters of scientific fact. There is no avenue in the process to raise concerns about the potential social and economic implications of listing additional species or ecological communities.

Effective, outcomes-based decision-making, where the community can engage with the process and understand the reasons for decisions, is the primary way to improve trust.

The experts who lead community engagement processes in environmental impact assessments (EIA) highlight that:

the levels of community outrage...increasingly reflect a greater community intolerance of proponents who disregard community values…key stakeholders and communities are losing, or have lost, confidence in project development and government approval processes (EIANZ 2020).

The growth in community interest in environmental decisions is indicative of the degree of mistrust. People want to know why decisions are made and want to contribute to decisions that affect them and Australia’s environment, especially when they believe those decisions are having negative consequences.

With limited trust in the effectiveness of the EPBC Act and no alternative avenue to participate, the community seeks information or influence through whatever means possible. The formal access options for both business and the community under the current arrangements are:

  • FOI applications
  • requesting statements of reasons
  • judicial review
  • merits review for Part 13A wildlife trade permit decisions (noting that merits review is not available for EIA decisions)
  • public comment processes.

4.2.1 - There is limited transparency of the information and advice provided to decision-makers and how these are considered in decisions

A key theme in submissions is the lack of transparency of how information is collected and incorporated into decision-making processes. The public do not trust claims made by advocates or governments on the costs or benefits of a proposal, and they do not trust the effectiveness of compliance and enforcement activities. There are concerns that proponents themselves commission environmental consultants in the EIA process. However, there are no professional standards or accreditation for these consultants, which further erodes trust in decision-making.

Low transparency and a lack of early public engagement by some proponents means that it is often late in decision-making processes that community concerns have the opportunity to be raised, such as when a specific development application is being considered. This is the most likely point the community will engage with the project impacts and the process.

Poor transparency encourages challenges to decisions. The growth in FOI requests is indicative of the degree of mistrust and the perceived lack of transparency and accountability for decision-makers. People cannot understand how decisions to approve developments can be consistent with the laws that protect the environment, if overall environmental indicators are trending down.

This lack of visibility is exacerbated by the complexity of the EPBC Act and limitations in both the scope and transparency of information used for decision-making, and to ensure compliance with the Act. There is a growing trend of post-approval arrangements, where specific environmental impacts and treatments are considered when proponent management plans are assessed. This post-approval process happens without the opportunity for public comment. The community also cannot see how allegations of non-compliance with the Act are investigated and resolved.

The EPBC Act and its processes focus on the provision of environmental information, yet the Minister can and must consider social and economic factors when making many decisions. The community cannot see how these factors are weighed in Act decisions under the current arrangements. There is no requirement for proponents to give fulsome information in relation to social and economic impacts of a project proposal, nor is there scope for the assessment process to test the veracity of that information.

The social and economic benefits and costs put forward by proponents are at the project scale, meaning that decision-making is not based on a complete nationally focused economic or social analysis. The trade-offs and considerations of decision-makers are not explicit, often happening behind closed doors. This gives rise to allegations that proponents have undue influence on decision-makers and the environment loses out to other considerations.

The advice provided to support decisions is not always made publicly available. This promulgates community concerns over the quality of the advice, or that government may have something to hide and shuns accountability for its decisions. There is a view that decisions are biased towards competing imperatives other than protection of the environment. To resolve this concern, many submissions to this Review have expressed a strong preference for decisions to be made by independent authorities or commissions, rather than democratically elected decision-makers and their delegates.

4.2.2 - High-profile decisions are contested – the community is dissatisfied with environmental outcomes

It is not clear how decisions explicitly contribute to environmental outcomes. Many contributions to the Review raised concerns that development approval decisions made under the EPBC Act are out of step with the views and values of the community.

Where concerns arise about environmental outcomes associated with a decision – and with no other viable alternative for the community – public focus turns to challenging high-profile decisions. Concerns are raised about the validity, completeness or accuracy of information on which decisions are based. Challenges can succeed on technical legal grounds rather than on environmental outcomes. There is currently no avenue in the EPBC Act to challenge the merits of EIA decisions; consequently, technical process compliance has become the focus.

In past Federal Court decisions (e.g. Tarkine National Coalition Inc v Minister for Sustainability, Environment, Water, Population and Communities [2013] FCA 694), the technicality was a failure to attach documents to a ministerial decision brief. This legal challenge was based on a failure to fulfil process obligations rather than questioning the outcomes resulting from the decision, which was remade with the same environmental outcome after legal proceedings were completed.

Where used, campaigns, protests and the use of the courts slow down developments. These delays often result in no material change to the decision. Technical challenges can therefore result in delays and costs for industry and the economy with little, if any, benefit to the environment.

4.2.3 - Industry perceives the EPBC Act to be cumbersome and prone to unnecessary delays

Complexity of the EPBC Act leads to uncertainty for business

The complexity of the EPBC Act leads to cumbersome processes, which are inefficient for both business and government. This adds to regulatory costs, without any associated environmental benefit (Chapter 3 and Chapter 11). For example, the Act does not allow decision-makers to correct or adjust decisions where strict adherence to process has not occurred. This leads to unnecessary process delays for industry, without necessarily changing the substance of the original decision.

Judicial review cases have driven a culture of ‘box-ticking’ within the Department. This has led to fewer resources being dedicated to assisting proponents to improve outcomes for the environment and more resources to administering processes.

The information used to make a decision and how the decision is made based on that information is not always consistent or clear. This leads to uncertainty for proponents. Past decisions are not transparent. Industry cannot derive lessons from previous interactions with the EPBC Act, which would lead both to efficiency and improvements over time. This is in contrast to determinations made under tax law or competition law, which are public and searchable.

Duplicative processes and slow decision-making drive up costs

An underlying theme of industry mistrust in the EPBC Act relates to its perceived duplication with State and Territory processes (Chapter 5) and the length of time it takes to receive a development approval. These are key reasons why industry is calling for a ‘single-touch’ model to reduce duplication and assessment time frames.

Between 2014 and 2019, resources sector projects took an average of nearly 3 years, or 1,009 days, to approve under the EPBC Act. This is too long (Box 17). For business, time is money. On large projects, time delays can result in significant additional costs. Recent provision of additional resources has improved performance of on-time assessment and approval decisions, from 19% of key decisions made on time at the end of December 2019 to 97% by the end of September 2020.

There is also little accountability in the post-approval phase. There are no statutory time frames for these decisions, and this has led to increased uncertainty and delay for industry (PC 2020, MCA 2020, APPEA 2020).

Box 17 - Time frames for assessment and approval of resource projects

The process for assessment and approval of development projects can be described in 3 stages: the time taken by the Environment Minister to receive a referral and make an assessment method decision; the time taken for the proponent to prepare the assessment documentation; and the time taken by the Environment Minister to make an approval decision.

Between the commencement of the EPBC Act in 2000 and the 2019–20 financial year, the average time taken for resource projects to be assessed and approved increased from an average of 716 days to 1,009 days. The time taken for the Environment Minister to make an approval decision on these projects increased from an average of 116 days to 193 days, with a peak average of 222 days during the 5 years between 2014 and 2019. A small reduction in average time frames is evident in the 2019–20 financial year (Figure 2).

Figure 2 - Average number of days taken for assessment and approval of resource projects under the EPBC Act, commencement of EPBC Act to 2013–14, 2014–15 and 2019–20
Figure 2 - Average number of days taken for assessment and approval of resource projects under the EPBC Act, commencement of EPBC Act to 2013–14, 2014–15 and 2019–20

Source: Department of Agriculture, Water and the Environment, unpublished

These time frames do not factor in time taken for post approval requirements, such as the development of management plans, which can be significant. They also do not factor in appeal time frames.

Submissions have noted that businesses have experienced time delays due to statutory deadlines being missed by the regulator. The Minerals Council of Australia cited project examples where it has taken 7 months to make a controlled action decision with a 20 business day statutory time frame and 87 business days to make an approval decision with a 40 business day statutory time frame (MCA 2020).

Lengthy assessment and approval processes are not all the result of a slow Commonwealth regulator. On average, the process is with the proponent for more than 70% of the total assessment time (Figure 2). This includes the time needed to collect required environmental information and collate necessary documentation, or when projects are shelved for periods of time for commercial reasons by proponents. In some instances, projects that require State and Commonwealth approvals can be held up by State or Territory assessment and approval processes. In rare cases, Commonwealth approvals can be received years before a State or Territory approval (PC 2020).

Industry is concerned that legal challenges add further delays

Poor trust in the EPBC Act has played out in a lengthy public debate about ‘lawfare’, with accusations that politically motivated environment groups use the courts to delay projects. The public discourse on legal challenges is focused on large projects with considerable economic benefits that impact highly valued environmental areas – for example, the Shenhua Watermark coal mine, the Carmichael coal mine (Adani), and Shree Minerals (Tarkine). Pro-development groups argue that the extended standing provisions (standing beyond a person directly affected by a decision) should be removed from the Act. Previous attempts have been made to remove these provisions.

The EPBC Act standing provisions provide broad but not open standing. The scope of extended standing has been tested in the courts, so there is a high degree of certainty about its application. In fact, the courts have interpreted the standing provisions to exclude ‘mere intellectual or emotional’ concerns as sufficient standing under the Act.

The Review has received highly conflicting evidence and views about whether there is significant abuse or gaming of appeal mechanisms under the EPBC Act. Generally, only a small number of decisions have been challenged relative to the approximately 6,500 projects referred under the Act. Figure 3 shows third-party court actions over the life of the Act. These cases have remained stable over this period.

Similarly, evidence from other jurisdictions indicates that open-standing arrangements (which are broader than the current provisions in the EPBC Act) do not necessarily lead to excessive numbers of legal challenges. In New South Wales, less than 2% of development applications are challenged via judicial or merits review (Macintosh et al. 2018).

Figure 4 shows FOI requests in the last 5 years relating to EPBC Act decisions. Although there is an increase in FOI requests in 2018 and 2019, there does not appear to be any significant driver to explain the increase (Box 18).

Box 18 - EPBC Act judicial reviews (2000 to 2020) and FOI requests (2015 to June 2020)

The number of third-party legal actions (judicial reviews and injunctions) in relation to development approval decisions has remained consistent each year over the life of the EPBC Act (2000 to 2020). Annually, judicial review proceedings vary from zero to 8 cases and injunctions number zero to 4 applications (Figure 3). In some cases, injunctions and judicial review proceedings relate to the same matter but this has not been quantified. Numbers are assigned according to the year in which the action commenced.

Figure 3 - Number of third-party legal challenges for EPBC Act decisions, 2000 to 2020
Figure 3 - Number of third-party legal challenges for EPBC Act decisions, 2000 to 2020

Source: Department of Agriculture, Water and the Environment, unpublished

The number of FOI requests in relation to EPBC Act decisions grew between 2015 and 2019. The Department received 34 FOI requests in 2015, 48 in 2016, 43 in 2017, 70 in 2018 and 99 in 2019. To June 2020 the Department received 33 FOI requests (Figure 4).

Figure 4 - Number of FOI requests for EPBC Act decisions, 2015 to 2020
Figure 4 - Number of FOI requests for EPBC Act decisions, 2015 to 2020

Source: Department of Agriculture, Water and the Environment, unpublished

The focus should not be to limit the capacity of people to use legal review to challenge decisions in the public interest. Rather, improving communication and transparency as well as the excessive requirements of the EPBC Act should be addressed as a matter of urgency to remove the most significant sources of delay and to increase certainty. This effort will minimise the drivers for legal challenge, particularly for litigation that is vexatious or without reasonable prospects of success.