Productivity Commission issues preliminary findings on the Australian resources sector

More complex, taking longer, and less certain. The Productivity Commission (Commission) confirms that there is scope for improvement for regulatory processes, including reduced duplication of Commonwealth and State assessments and approvals.

Snapshot

• Regulatory processes in the resources sector have been found to be increasingly complex, duplicative, lengthy and uncertain.
• Enhanced regulator accountability and transparency is recommended by the draft report to reduce unnecessary costs, improve regulated outcomes and help build community confidence in the resources sector.
• Submissions on the Resources Sector Regulation Draft Report (Draft Report) close on 5 June 2020.

Complexity, duplicity and uncertainty

On 24 March 2020, the Commission released the Draft Report on its study into reducing unnecessary regulatory burdens without reducing environmental and other regulated outcomes.

The Draft Report sets out a number of areas of concern, including:

• increasingly lengthy approval timeframes beyond what is necessary to deliver thorough merits assessments (e.g. the Draft Report cites data indicating an increase in Environment Protection and Biodiversity Conservation Act 1999 approval timeframes);
• excessive number of approval conditions, which are often ‘overly complex’ and ‘prescriptive’ discourages international investment;
• inconsistency and overlap between jurisdictions; and
• the fundamental uncertainty of process.

Leading regulatory practice

The Draft Report does not identify one Australian jurisdiction as an example of ‘leading regulatory practice’. In the absence of an exemplary jurisdiction, the Commission provides a number of examples as to what reflects ‘leading regulatory practice’ in various jurisdictions. Overall, the Commission supports an effective risk and outcomes based approach by regulators who:

• are accountable and transparent;
• follow clear and predictable processes;
• build fit-for-purpose technological and staff capabilities;
• collect, use and disseminate data effectively; and
• work to inform the community about their activities.

Priorities for improvement

To promote the adoption of leading regulatory practice, the Commission proposes a number of priorities for improvement, including:

• effective risk and outcomes based approaches;
• clearer guidance for, and stronger engagement with industry;
• use of target approval timelines and reporting;
• improved inter-regulator cooperation to reduce duplication; and
• greater engagement and transparency to build community confidence.

Next steps

The Commission’s review is likely to result in legislative reform that is favourable for industry participants. Stakeholders within the resources sector should consider making a submission to the Commission during this important review to highlight areas of concern or avenues for improvement.

The Commission will accept written submissions on the Draft Report until Friday 5 June 2020.

Submissions may be made on the Commission’s website.

Please contact us if you have any queries or would like assistance with making a submission.

By Peter Briggs, Partner, Tom Dougherty, Senior Associate, and Michael Themis, Solicitor.

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