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4.2 - Proposed key reform directions

The foundational intergovernmental agreements on the environment envisaged that jurisdictions would accommodate their respective responsibilities in each other's laws and regulatory systems, where possible. This is a sound ambition, and one the governments should continue to pursue.

Previous attempts to devolve decision-making focused too heavily on prescriptive processes and lacked clear expectations and thresholds for protecting the environment in the national interest. The National Environmental Standards proposed by this Review provide a legally binding pathway for greater devolution, while ensuring the national interest is upheld (see Chapter 1).

Pursuing greater devolution does not mean that the Commonwealth 'gets out of the business' of environmental protection and biodiversity conservation. Rather, the reform directions proposed would result in a shift with a greater focus on accrediting and providing assurance oversight of the activities of other regulators and in ensuring national interest environmental outcomes are being achieved.

The devolution model proposed is not an all or nothing concept. The Commonwealth would need to retain its capability to conduct assessments and approvals where the Commonwealth provides sole jurisdiction, where accredited arrangements are not in place (or cannot be used), at the request of a jurisdiction, or when the Commonwealth exercises its ability to step in on national interest grounds. Such capability is essential to ensure that EPBC Act requirements can continue to be upheld in circumstances where other regulators are, for whatever reason, unable to accommodate Act requirements in their processes. To weaken this capability would risk unnecessary delay for projects.

The Commonwealth could:

  • accredit state and territory (and other regulatory) systems to assess and approve projects, where they can demonstrate they meet National Environmental Standards—this may require states and territories to adapt their regulations to meet National Environmental Standards and to satisfy accreditation requirements
  • approve projects that have been assessed by the states and territories under accredited assessment processes
  • accredit activities on a regional basis, for example where a regional plan is in place
  • accredit particular types of activities that are appropriately regulated by others (such as fisheries, see section 4.3.4).

For projects approved under accredited arrangements, the accredited regulator would be responsible for ensuring that projects comply with requirements, across the whole project cycle including transparent post-approval monitoring, compliance and enforcement. The Commonwealth should retain the ability to intervene in project-level compliance and enforcement where egregious breaches are not being effectively enforced by the accredited party.

The devolution model proposed by this Review is shown in Figure 3 National Environmental Standards support accreditation and devolution Figure 3.

Figure 3 - National Environmental Standards support accreditation and devolution

This figure shows the relationship between the five key components of the proposed devolution model. National Environmental Standards sit at the top to define the outcomes and set the benchmark for performance. Under this sits the process of accreditation assessment, involving independent assessment and including public comment. The third component is accreditation by the Australian Government Environment Minister. Once the process is accredited, actions consistent with that process do not require further a

The proposed devolution model involves 5 key elements:

  1. National Environmental Standards to set the benchmark for protecting the environment in the national interest and provide the ability to measure the outcomes of decisions.
  2. State or territory to demonstrate that their systems meet National Environmental Standards. This element should include transparent assessment of the jurisdiction policy, plan or regulatory process against National Environmental Standards. It should include a formal check by the independent monitoring, compliance, enforcement and assurance regulator, to give confidence that arrangements for monitoring and assurance of accredited arrangements are sound.
  3. Formal accreditation by the Commonwealth Environment Minister. This element provides accountability and legal certainty. The Minister should be required to seek the advice of the proposed Ecologically Sustainable Development (ESD) Committee (see Chapter 5), and this advice transparently provided as part of the accreditation process.
  4. A transparent assurance framework. This element provides confidence that parties are implementing the processes and policies as agreed. It should include the mechanisms for the Commonwealth to step in when it is in the national interest to do so. The assurance framework should include:
    1. governance, reporting and assurance arrangements
    2. independent monitoring, audit and compliance, to support public reporting on the operational and administrative performance of an accredited systems
    3. triggers for dispute resolution to enable the Commonwealth to step in. These triggers should avoid any opportunity for gaming and unnecessary disruption to the whole regulatory system. Triggers could include:
      1. where the Environment Minister deems a matter of such environmental significance that the Commonwealth should deal with it
      2. in an individual case if the National Environmental Standards are demonstrated not to have been met by the accredited party
      3. where there is a systemic failure to meet National Environmental Standards leading to suspension (or ultimately revocation) of accreditation.
  5. Regular review and adaptive management that ensures decision-making contributes to the objectives established in the National Environmental Standards, including
    1. regular scheduled reviews of the accreditation system and whether the National Environmental Standards are delivering the outcomes intended
    2. adaptive management over time, as data, information and knowledge improve, and regulatory systems mature.

As is the case now, where formal accreditation arrangements are not in place, Commonwealth and state or territory collaboration (for example, through the conduct of joint assessments) should continue to be pursued to facilitate streamlining and harmonisation.