Interim report of second independent review of Commonwealth EPBC Act 1999 examined

The Commonwealth Environment Protection and Biodiversity Conservation Act 1999 (the Act), section 522, requires that the Act’s operation, and the extent to which its objectives are being achieved, be independently reviewed every 10 years.

Paraphrasing, the objectives of the Act include:

• The protection of the environment, particularly those matters with which the Act is primarily concerned, called Matters of National Environmental Significance (MNES);
  
  
• The promotion of Ecologically Sustainable Development (ESD), conservation of biodiversity and heritage; and
  
  
• Recognition of the role and knowledge of Indigenous people in matters dealt with by the Act.

The second such review of the Act (following the Hawke Review in 2009) was commenced by Professor Graeme Samuel AC in October 2019. Professor Samuel’s Interim Report was published in June 2020 (the Interim Report).

The Interim Report is highly critical of both the operation of the Act and the extent to which it is seen to be achieving its objectives. It is said that:

“The EPBC Act is ineffective. It does not enable the Commonwealth to play its role in protecting and conserving environmental matters that are important to the nation.”

More particularly, the Interim Report says that the Act is not clear about the environmental outcomes it seeks to achieve and has assumed a more ’transactional’ focus with an emphasis on process. It notes the Act is doing little to halt the continuing decline in the quality of the Australian environment and heritage places. Hence one of the main areas of focus of the Interim Report is on restoration.

In this Insight we consider some of the main recommendations of the Interim Report including the centrepiece recommendations of National Environmental Standards and Regional Environmental Plans, supported by detailed ecological and other data called a “single point of truth” in the Interim Report, delivered through an organised “environmental information supply chain”, managed by an independent entity.  

Before considering those recommendations and how they would affect Environmental Impact Assessment (EIA) under the Act, we examine some of the other more significant aspects of the Interim Report.

Maintaining ESD as a core principle

The Interim Report is strongly in favour of maintaining ESD as a core principle of the Act, referring at times to the Act’s role in achieving ESD. The Act of course refers to the ’promotion’ of ESD.  

The achievement of ESD requires the harmonisation, common understanding, and consistent application of ESD principles in law and policy across all three levels of Government. While it is not something the Act can deliver alone, the treatment of ESD in the Act and its implementation could help to serve as a model for other jurisdictions which continue to develop what might be called ESD jurisprudence.

No new MNES

The Interim Report does not agree that there should be any new MNES added to the Act. In particular, it does not consider there needs to be a “climate change trigger”, (one of the limited recommendations of the Hawke Report not implemented). However it does say that a project’s full emissions profile should be a feature of EIA under the Act and that the impact of those emissions on MNES be considered under specified climate change scenarios.

In most project EIA, greenhouse gas emissions are now considered, although debate continues about what responsibility, if any, an Australian fossil fuel project should bear for Scope 3 emissions generated from combustion of those fuels overseas.  

Some have argued that section 527E of the Act (enacted after the Queensland Nathan Dam case) dealing with indirect impacts of a project (an ’action’ in the Act), requires that those Scope 3 emissions be accounted for in project assessment. The issue though, as the Federal Court has observed, is that attributing such emissions to any identified impact on MNES is problematic if not impossible. Section 527E has been criticised by the Court for its complexity.

The Interim Report also comments on the newest MNES in the Act, the ’water trigger’ for large coal mines and coal seam gas projects. It has resisted some calls to expand the trigger and acknowledges that the States are well positioned to assess water related impacts. It recommends the water trigger in the Act be limited to a consideration of any such projects that risk irreversible depletion or contamination of cross border water resources only.

Standing and merits review

The Interim Report does not recommend any curtailing of the extended ’standing’ rules in the Act. These enable third party judicial review challenges to decisions made under the Act.

However, it does suggest that the standing rules might be limited so as to require that persons wishing to avail themselves of the standing rules to mount a challenge, be first required to demonstrate they have an arguable case or that the issue to be raised is of exceptional public importance, before they can proceed. This is to minimise what is sometimes called ’lawfare’, i.e. challenges brought essentially on ideological or political grounds.

Of perhaps more interest, and likely to be controversial, is the suggestion that there be a form of limited merits review ’on the papers’ introduced. This, it is said, would need to be “carefully designed to minimise perverse outcomes”. The limited form of merits review would be limited to EIA decisions made under the Act to ensure they were reasonable given the material available at the time of the decision, and to ensure the decision was of a high quality.

It is not difficult to see how such a limited system of merits review would come under pressure to expand. For example, testing the “reasonableness” of a decision against the material on which the decision was based, in a merits review context, could be argued to necessarily require new evidence to examine the correctness or otherwise of that material.

Indigenous involvement

Indigenous involvement in matters with which the Act is concerned is said to be ineffective and tokenistic. A National Environmental Standard for best practice indigenous engagement is called for as is a review of national level indigenous cultural heritage protection legislation. The Interim Report acknowledges that the Act may not necessarily be best placed to protect all aspects of indigenous heritage.

Currently, the States administer Aboriginal Cultural Heritage legislation in a project setting which tends to be different in each State. Some harmonisation of the different State approaches based on an agreed (i.e. agreed by Indigenous people) best practice model would be useful.

National Environmental Standards, Regional Plans, EIA and Devolution

The development of National Environmental Standards and Regional Environmental Plans, supported by greatly improved information and data systems are at the heart of the Interim Report’s recommendations. It is said these would assist the efficiency of the EIA system under the Act and make devolution to the States easier.

Many will be aware of the stalled attempt in 2014 to devolve EPBC approval functions to the States. The Interim Report supports a revisiting of those efforts, but supported by the measures described above. The suite of National Standards would include requirements relating to:

• ESD;
  
  
• MNES;
  
  
• Transparent processes and robust decision making, including in the areas of judicial review, consultation, assessment of impacts (including climate change impacts), and emission profile disclosure;
  
  
• Indigenous engagement and involvement in decision making;
  
  
• Monitoring, compliance and enforcement;
  
  
• Data and information;
  
  
• Monitoring and evaluation of outcomes;
  
  
• Restoration and recovery; and
  
  
• Wildlife permits and trade.

In terms of EIA, the Interim Report suggests there should be different ’pathways’ for high and low impact proposals so that assessment is proportional to the level of impact on MNES.

No Commonwealth assessment or approval would be required if a project could demonstrate that it meets relevant National Environmental Standards. Such projects would be registered, and include sufficient information to demonstrate that the project meets the relevant Standards. The same would apply if a project could demonstrate consistency with an approved Regional Plan.

While the Interim Report emphasises outcomes rather than process, a degree of process will still be inevitable in connection with the application of National Environmental Standards and Regional Plans.

The process for demonstrating compliance with relevant Standards and Plans is not entirely clear in the Interim Report. For example, is it intended that the process be a self-assessable one with no referral required? Or is it intended that there be a referral, but on the basis that the project seeks registration, rather than assessment and approval, because the proponent believes it can demonstrate compliance with the Standards/Plans?

If the latter, will there be a decision required by someone, the Commonwealth or a State exercising devolved authority, confirming compliance?

The Interim Report notes that a diverse range of interests support the development of Standards, and their use in the EIA process. These interests include, the Australian Conservation Foundation, the 10 Deserts Project, the Business Council of Australia and the Minerals Council of Australia.

 The Interim Report cautions that the Standards should not involve a ’lowest common denominator’ compliance regime. While it is said there should be extensive consultation in their development, including with the community, environmental, indigenous and business stakeholders, and the States, it is also said the process should not become drawn out.

Interim Standards are suggested as a temporary measure, with the granularity of Standards and Plans improved over time through regular adaptive review, having regard to experience and improving knowledge.

It is this need for a comprehensive knowledge base which underpins the integrity of the Standards and Plans that may delay their development, as much as the consultation suggested in relation to them.  

There will clearly be a significant divergence of view as to what constitutes an adequate Standard or Plan in a variety of circumstances. The Interim Report concedes there is a long way to go in developing the necessary data/information base. A significant financial investment will also be required.

Support in key areas of activity relevant to the Standards, Plans and EIA under the Act would come from a number of suggested advisory Committees, including:

• An overarching ESD Committee;
  
  
• An Information and Knowledge Committee;
  
  
• An Indigenous Knowledge and Engagement Committee;
  
  
• A Threatened Species Committee;
  
  
• The Australian Heritage Council; and
  
  
• A Water Resources Committee.

Restoration

The Interim Report is critical of the current offsets system, which it is said is not delivering a net gain for the environment.

It suggests that offset requirements be the subject of clear laws rather than embedded in a policy as is currently the case. They should be required only where options to avoid and mitigate impacts have been demonstrably exhausted. Many would argue that this is the case now, however the Interim Report promotes a greater emphasis on avoidance and mitigation first, rather than what might currently be the case in some circumstances.

The Interim Report supports a greater emphasis on advanced and restoration offsets that do result in a net gain of habitat. It is suggested by the Interim Report that this is likely to result in greater market driven participation in offset markets, akin to the carbon market.

Some concluding observations

There is obvious merit in the Interim Report’s key recommendations. Some require more thought as to their development and implementation, e.g. the limited merits review proposal, moderated standing requirements and demonstrating compliance with National Environmental Standards and Regional Environmental Plans.

However, there is also merit in ensuring the ’baby is not thrown out with the bathwater’, meaning that practitioners (of various disciplines) are very familiar with the current EIA system pertaining under the Act and its various components. Many would not regard it as particularly difficult to navigate. The culture of ’if in doubt, refer’ that has grown up under the Act, while criticised in the Interim Report as an unnecessary step if greater guidance of significant impact was available, nonetheless serves two legitimate functions. First, it provided legal certainty for proponents, and secondly it serves to cast a wide net over proposals (actions) that may have a significant impact.

In the absence of comprehensive, well informed National Environmental Standards and Regional Environmental Plans, EIA, as presently undertaken, with the assistance of many expert disciplines, is itself a process of determining what are the most bespoke standards (applied as conditions) to apply to a project, albeit not always with the emphasis the Interim Report seeks on clearly defined outcomes and strategies to attain a net gain to the environment.