2.29As indicated above, we are not convinced a case exists for a stand-alone statute at this time. The combination of options three, four and five should provide sufficient direction for the approach to take in the future. However, we think the question is finely balanced. Indeed, there may be a risk in delaying, as a more complex alignment exercise may be needed in the future when the number of statutes has grown. If existing inconsistencies are not remedied, and if the range of variants continues to grow, we suggest that the question should be reconsidered in the future. If it is, to assist, we set out the arguments for and against a statute.
2.30A statute containing standard provisions could take one of two forms. It could be a default regime, so that:
2.33A statute would be the most direct form of guidance, so may be the most likely to ensure a principled and consistent approach. As noted above, policymakers currently have a number of precedents to choose from when designing new regimes. A statute would provide a single, authoritative precedent that would be the first port of call.
2.34It would also boost transparency. The public nature of an Act should encourage more open debate about any departures from it. Such a debate would be more likely to take place early in the policy process, so is more likely to be appropriately robust, informed and effective. Although debate may still take place with LAC Guidelines in place, it may not occur until after a Bill has been introduced to Parliament, by which time policy positions have often become entrenched.
2.35A statute could also provide the vehicle for amendments to the existing statutes. The alternative will be for our proposed amendments to be made by omnibus bill, or to wait until each individual Act is being amended.
2.36A pecuniary penalty statute would probably be the most effective means of achieving the desired aims of having quality, principled legislation, reducing the risk of litigation, promoting regulatory efficiency, and simplifying and reducing the length of the statute book.
2.37On balance, the following arguments have persuaded us not to recommend a statute at this time. First, as indicated above, we hope that options three, four and five above are sufficient to ensure that our Guidelines are followed. If so, it is difficult to justify expending more significant resources to enact special legislation.
2.38Secondly, such a statute could make the statute book less accessible, since in some cases it will be necessary to consult both the pecuniary penalty statute and the substantive statute.
2.39Thirdly, there may be a risk of “regulatory creep”, whereby the provisions under the pecuniary penalty statute will be tacked on to new or amended statutes as a matter of course, with inadequate consideration of whether they should actually apply.
2.40Fourthly, it may be difficult to obtain agreement on the design of the provisions in a statutory form.
2.41We note that the Regulatory Powers (Standard Provisions) Bill 2014 (Cth) is before the Australian House of Representatives. In May 2014, the Senate’s Legal and Constitutional Affairs Legislation Committee reported back on the Bill and recommended its passage.
2.43The Bill will only apply to regulatory schemes that trigger its provisions through primary legislation. It is intended that the Bill will reduce the time it might otherwise take the Office of Parliamentary Counsel to negotiate drafting issues with relevant agencies.
Recommendations
R1 The Ministry of Justice should be consulted on all proposals for pecuniary penalties at the policy development stage, in the same manner as for criminal offences, as directed by Cabinet and paragraph [7.31] of the Cabinet Manual.
R2 The Legislation Advisory Committee should draft a section of its Guidelines on Process and Content of Legislation on best legislative practice for pecuniary penalty regimes. The section should refer to and build on the Guidelines in Appendix A of this Report.
R3 The Parliamentary Counsel Office should draft model provisions for common pecuniary penalty provisions.
R4 When existing pecuniary penalty statutes come up for review their pecuniary penalty provisions should be re-evaluated in light of the Guidelines in Appendix A of this report.
