Michael Stokes, Senior Lecturer, Faculty of Law, Tom Baxter, Lecturer in Commercial Law, Faculty of Business, University of Tasmania

… the Bill is flawed and should not be passed in anything like its current form.

We have read and considered the Pulp Mill Assessment Bill 2007. We hold grave concerns regarding the proposed legislation, including the following:

1.The abandonment of proper processes and the privatisation of an essential State responsibility for the proper assessment of the development.

2.The lack of transparency of the process.

3.The limited nature of the proposed assessment.

4.The extraordinary immunity from suit and legal protection given to the project.

5.The abdication of State responsibility for the assessment accepted in the bilateral agreement of 12 December 2005 entered into by the Commonwealth and Tasmania under s 45 of the Environment Protection and Biodiversity Conservation Act 1999.

1.The abandonment of proper processes and the privatisation of an essential State responsibility for the proper assessment of the development.

Basis for the integrated assessment by the RPDC — now abandoned

The Bill, s 13, revokes the State Policies and Projects (Project of State Significance) Order 2004. Under that and associated legislation, an “integrated assessment” of the project was being conducted by the Resource Planning and Development Commission (the RPDC), a State government agency established under its own RPDC Act with overall responsibility for planning and development assessment in Tasmania (see www.rpdc.tas.gov.au). An “integrated assessment” means “a consideration of environmental, social, economic and community issues relevant to that project and such other issues as may be prescribed”; State Policies and Projects Act 1993, s 16(2).

The RPDC’s responsibilities for a project of State significance such as this include undertaking an integrated assessment, then making recommendations as to whether the project should proceed, and if so, on what conditions. The RPDC’s integrated assessment must follow specified statutory requirements. For example, the integrated assessment –
(a) must seek to further the objectives of the Tasmanian resource management and planning system (described below); and
(b)must be undertaken in accordance with State Policies; and
(c) must take into consideration the matters set out in the representations in respect of its draft integrated assessment report; State Policies and Projects Act 1993, s 20(5).

None of these safeguards are in the Bill. Rather than an integrated assessment, the Bill ‘fast-tracks’ (even if there is criminal conduct; s 11(3)) an approval-path for a very widely defined “project” (s 3(1)). Parliament’s rushed approval (s 7), will be based on a report to be outsourced to an unspecified consultant (to be appointed at the Minister’s absolute discretion; s 4(1)) who will undertake a much narrower, more limited, assessment than that by the RPDC.

The objectives of the Tasmanian resource management and planning system that were to have been furthered by the RPDC’s integrated assessment are set out in the Schedules of a raft of planning and development legislation, such as the Land Use Planning and Approvals Act 1993, the Resource Planning and Development Commission Act 1997, the State Policies and Projects Act 1993, etc. These objectives are:
(a) to promote the sustainable development of natural and physical resources and the maintenance of ecological processes and genetic diversity; and
(b) to provide for the fair, orderly and sustainable use and development of air, land and water; and
(c) to encourage public involvement in resource management and planning; and
(d) to facilitate economic development in accordance with the objectives set out in paragraphs (a), (b) and (c); and
(e) to promote the sharing of responsibility for resource management and planning between the different spheres of Government, the community and industry in the State.
To implement clause (c) of the objectives, the RPDC must when assessing any project of State significance give the public the opportunity to make representations, consider these and may conduct public hearings; State Policies and Projects Act 1993, ss 23 and 24.

The RPDC is also subject to oversight by the courts, to ensure that it acts according to law. It must also observe the rules of natural justice at hearings.

The overall effect of the system is that the RPDC acts and can be seen to act openly and according to law in accordance with publicly stated objectives which have long been endorsed by parliament.

New regime under the Bill

The RPDC processes revoked by the Bill differ completely from the approach it adopts which abandons due process and guarantees of public participation along with the stated goal of ensuring sustainable development. The new legislation does not even mention, let alone contain any commitment to, the objectives of the planning system. It takes assessment of the project out of the hands of the RPDC, a legally accountable public body committed to act in accordance with the goals of the planning system, placing it instead in the hands of a private consultant.

The consultant is accountable to no-one except the Minister and is only accountable to the Minister to the extent of giving him the report required by section 4(3), a report as to whether the mill should proceed and if so, the matters which should be dealt with by means of conditions. The consultant is answerable to neither the Minister nor the courts for the way in which they conduct their assessment. Nor is the consultant required by the Bill to release their assessment of the mill against the guidelines to anyone, including the Minister. Although s 6(10) of the Bill requires the Minister to table the report in both Houses of Parliament, it is clear from s 4(3) that while the report must be based on the assessment, the assessment is not part of the report. Hence the assessment can be withheld from parliament and kept secret so that parliament and the public are not guaranteed any right to know whether the mill met the guidelines, only that the consultant reported that it should proceed. It may be in the interests of the Minister to keep the assessment secret if it were damning but the consultant was prepared to report that the proposal should be allowed to proceed.

Members of the public have no right to a hearing, and indeed the consultant is not even bound to take into account representations made by members of the public to the RPDC. Section 5 empowers the consultant or the Minister to require of the RPDC any document relevant to its assessment of the project (without any scope for consultation with the author of the document or denial of such a request). But the consultant is under no duty to ask for representations made to the RPDC or to give them any weight. So the consultant is free to ignore them, and as there is no duty to release the assessment, no-one has a right to know whether that has happened.

Although the Expressions of Interest Brief includes public representations in the contract material, that is that material which is to form the main basis of the assessment it does not impose on the consultant any legal duty to take them into account. One of the tasks the consultant is required to perform is to review relevant sections of the contract material, Clause 2.2(1) of the Brief. Any duty which that imposes is only owed to the consultant’s employer, the government , and is not enforceable by any member of the public who made a representation or whose interests may be adversely affected by the mill. Besides, the public representations only need to be considered to the extent that they are relevant. Because the Bill in s 11 rules out any review by the courts, the consultant will have an unfettered discretion to determine what is relevant.

These are extreme denials of openness and accountability. They have very serious implications, especially given that under the Bill the consultant has the power to report that the project should proceed whether or not it meets the assessment guidelines; see section 4(3) discussed in more detail below. This Bill enables a report that the project should proceed to hide the fact that the project failed to measure up to the assessment guidelines.

The flaws set out above allow for political interference in the process without the public or the parliament having any way of knowing the extent of that interference, if any. The Expressions of Interest Brief of 22 March 2007, inviting expressions of interest to act as consultant do nothing to allay concerns about the possibility of such interference. Under clause 2.2, the key outputs of the project are to:
a)Review the relevant sections of the Contract Material;
b)Undertake an assessment of the project against the Guidelines as defined in the Bill;
c)Prepare a draft report for the Consultant Selection Panel of the outcomes of the assessment including, on the basis of the assessment, a recommendation on whether or not the project should proceed, and if it is recommended that the project should proceed, recommended matters to be contained in the conditions that should apply to the project; and
d)Prepare a final report to the Minister for Planning.

As the selection panel referred to in clause 2.2(c) consists of senior public servants, the clause ensures that the government has the consultant’s draft report for some time before the final report is released to the Minister for Planning. That provides the government with an opportunity to pressure the consultant to amend the report to make it more favourable to the development. A consultant is going to be in a much weaker position than the Chair of the RPDC assessment panel to resist government interference.

These flaws are exacerbated by the little time, 3 sitting-days, within which each House of Parliament must consider and accept or reject the Pulp Mill Permit, s 7(2). Parliament may be able to gain access to the assessment by dint of enforcing parliamentary privilege but there is no guarantee of that. Assume that the consultant was brought in from overseas, did not give the Minister a copy of the assessment and had left the country again by the time parliament received the consultant’s report. How would parliament enforce any order to produce the assessment? Even if the Minister had the assessment and declined to release it, how easy would it be for either House to force the Minister to produce it in time for proper consideration and decision within the 3 sitting-days allowed? The issue would be complicated by the fact that there is no duty on the consultant to produce a written assessment, and even if they did, the assessment may well be a private document, copyright in which belongs to the consultant rather than the government.

2.The lack of transparency of the process

The lack of proper processes outlined above means that there is a remarkable lack of transparency about the new decision making procedure, highlighted by the fact that the Bill does not impose a duty on the consultant to release the results of the assessment. Because of the lack of any duty to release the assessment and because the consultant is a private consultant rather than a government agency, it is very difficult to hold the consultant accountable politically or to question what the consultant has done through the political process.

The lack of accountability is increased by the total immunity from any legal challenge
which the Bill purports to give the consultant; s 11.
Subsection 11(1) (discussed below) grants immunity from legal action or proceeding to “any action, decision process, matter or thing arising out of or relating to this Act.” Subsection 11(3) even grants protection to the Pulp Mill Permit in the event of criminal conduct.

3.The limited nature of the proposed assessment

Section 4(1) requires the consultant to assess the “project” against the “guidelines”, both terms defined in s 3(1). The “guidelines” are the Recommended Environmental Emission Limit Guidelines for any new Eucalypt Kraft Pulp Mill in Tasmania prepared by the Resource Planning and Development Commission on behalf of the Government dated August 2004; s 3(1). These are not the guidelines against which the RPDC was assessing the project. Those were much broader as indicated by the Ministerial Direction to the Resource Planning and Development Commission of 26 November 2004, directing it to undertake an integrated assessment of the project. That direction required the RPDC to consider, amongst other things, the environmental, social and community issues relevant to the proposal. The Direction also required the RPDC to consider the environmental, social and community impacts during the construction phase, and the matters, mostly relating to impacts on threatened species and on the marine environment, which the Commonwealth Minister is required to take into account under the Environment Protection and Biodiversity Conservation Act 1999, both totally ignored in the present assessment. Under the Bill, the enquiry is limited to assessing the emissions alone. Other environmental, social and community impacts of the very widely defined “project” are not to be assessed.

This is a much narrower assessment and leaves many aspects of the “project” unassessed, including: the supply or distribution of energy to or from the mill; the collection, treatment or supply of water; access and transport to or from the mill; and wood supply. The assessment does not comply with the level of assessment required for a major project under the State Policies and Projects Act 1993 or indeed for a level 2 assessment under the Environmental Management and Pollution Control Act 1993, both of which require a more comprehensive assessment. Even when we take into account that the Commonwealth will be forced to conduct a separate assessment under the Environment Protection and Biodiversity Conservation Act, important aspects of the project, including transport, construction impacts and possibly water and wood supply implications will not be assessed. All these unassessed aspects of the development are approved if the “project” is approved under the Act even though they have not been assessed; see the very wide definition in s 3 of project as including:
Any use or development which is necessary or convenient for the implementation of the project, including but not limited to the development and operation of any facility or infrastructure for –
a)the supply or distribution of energy to or from the mill; and
b)The collection, treatment or supply of water; and
c)The treatment, disposal or storage of waste or effluent; and
d)Access to or from the mill; and
e)Transport to or from the mill; and
f)The storage of pulp at, or transport of pulp from, a sea port in the northern region or the northwestern region; and
g)The production of materials for use in association with the operation of the mill.
This is clearly an inadequate level of assessment.

Although the assessment is manifestly inadequate, the consultant is not bound by it and is free under the Bill to recommend that the mill goes ahead even if it fails the assessment; s 4(3). That subsection requires that the consultant’s report be based on its assessment but does not prevent the consultant reporting that although the mill failed the assessment, the failures were not significant, the risks were minimal and the mill should proceed. If the consultant made such a recommendation, parliament would be placed in an impossible position. It will have only one source of expert advice, the consultant’s report, and no time to seek other opinions as it has three days in which to approve or reject the development; s 7(2). Hence there is a very real possibility that although the assessment is inadequate, we will end up with a mill which does not even meet the assessment standards.

The Expressions of Interest Brief inviting applications for the position of consultant support the view that the consultant may recommend that the mill proceed even if it does not meet the guidelines. The Statement of Requirements in that document, which sets out the parameters of the assessment which the consultant must conduct states in part:
In particular the Consultant must:
h)If limits specified in the Guidelines are unlikely to be met, advise on whether the predicted emissions are considered consistent with accepted international best practice for a project of this nature and scale; and
i)If accepted modern technology and best practice environmental management measures or other requirements specified in the Guidelines will not or are unlikely to be met, advise on whether that aspect of the project is considered consistent with accepted international best practice for a project of this nature and scale.

These extracts make it clear that the consultant is under a duty to the government to report on the whether any failures to meet the guidelines are acceptable in the sense that they comply with international best practice. It sends a clear message to the consultant to approve the mill if it does not meet the guidelines but can be said to comply with ‘accepted international best practice’, however that is defined. (Note it is clearly a lower standard than ‘best practice environmental management measures’; see clause (i) above.) Unless there are concrete, detailed internationally accepted standards for each of the emissions dealt with in the Guidelines which can be used to assess the mill (We do not know whether this is the case or not), ‘international best practice’ is a very rubbery standard with which to replace the specific standards in the guidelines. If there are no concrete internationally accepted standards, it is wrong to allow the mill to be assessed against such an ill-defined standard.

4.The extraordinary immunity from suit and legal protection given to the project.

Section 11 of the Bill gives extraordinary levels of immunity from suit to the assessment process and to any permit which issues from it. The most alarming feature of that section is s 11(3), which states that even criminal conduct (such as gaining a permit by the payment of bribes, corruption, fraud or intimidation), cannot delay the Pulp Mill Permit or any action authorised by it. This entails that a permit based on an assessment which is completely tainted by criminal activity remains valid. That is clearly wrong in principle, not least because if the assessment is tainted by criminal behaviour, there is no guarantee that any real assessment was carried out, and hence no guarantee that the mill complies with the guidelines.

Section 11(1) is also very broad as it prevents any appeal, review, action or proceeding in respect of, for example, the way in which the consultant carried out their duty. Section 4 requires the consultant to carry out an assessment against the guidelines and to consider new developments in pulping technology which have occurred since August 2004 and current best available technology and emission limits. By preventing any external review of the consultant’s performance of their duty, section 11 leaves the consultant to be the final judge so far as the law is concerned of their performance of their duty. That is particularly disturbing given that, although the consultant’s report must be tabled with the Pulp Mill Permit, the consultant has no legal duty to make their assessment public so there may also be no possibility to assess their compliance politically.

The lack of review is also disturbing in that it means that there is no remedy for denial of natural justice. As noted above, the consultant is not required by the Act to take into account any of the public submissions which the RPDC received. Some of these may be from property owners in the area who fear that the mill will have an adverse affect on their property and business interests. As their submissions may be ignored and s 11 takes away any legal right to approach the courts, they have no legally enforceable guarantee that their interests will be considered in the assessment process. That is unfair and some process needs to be adopted to ensure that their interests have to be considered.

The very broad wording of s 11(1) preventing any action or proceeding in respect of ‘any action, decision, process, matter or thing arising out of or relating to this Act’ was probably designed to prevent any review where the consultant or another person acts outside the powers given to them by the Bill. That is bad enough as it means that the consultant, who is not even a government official, is the final judge of the scope of his/her powers under the Act. However, on one interpretation s 11(1) has far broader implications. If the mill is a ‘thing arising out of’ the Act, s 11(1) may prevent any legal action being brought against the mill at common law. Under s 8(1)(d), government agencies retain the power and the duty to enforce permit conditions against the mill. But permits are not normally regarded as a defence to common law actions such as trespass or nuisance, so that a person who suffered damage as a result of the mill’s activities would normally be able to sue in one of these causes of action even if the mill had not breached its permit. On the interpretation above, section 11 would take away that right, leaving people with no protection against the mill as long as it complied with its permit. That is wrong. The common law actions are the ultimate defence of the citizen against damage caused by others and should not be taken away just because the other complies with a permit.

5. The abdication of State responsibility for the assessment accepted in the bilateral agreement of 12 December 2005 entered by the Commonwealth and Tasmania under s 45 of the Environment Protection and Biodiversity Conservation Act 1999 (Cth).

The bilateral agreement referred to above shares responsibility for environmental management between the Commonwealth and the State. Under it, Tasmania has the primary responsibility of assessing the environmental impacts of proposals for its own purposes and for those of the Commonwealth, the Commonwealth retaining the power to carry out its own assessment where the State’s assessment is inadequate. This Bill shows that the Tasmanian government is either unwilling or unable to carry out its responsibilities under the agreement, forcing the Commonwealth to take over those responsibilities itself. As a result, it provides the Commonwealth with a further argument to justify a takeover of State functions in this area. If that happens, it will lead to a further centralisation of power in Canberra and one more nail in the coffin of Australian federalism.

States often complain of Federal interference in their areas of power. But power requires responsibility and if a State is not prepared to exercise its powers responsibly, it invites a Commonwealth takeover. If this piece of legislation passes, Tasmania will have demonstrated that it cannot be trusted to assess major projects in an environmentally responsible way. It will give the Commonwealth good reason to be suspicious of Tasmanian assessment processes and to abandon the bilateral agreement. If that happens, all major projects in Tasmania in which the Commonwealth has an interest will have to be assessed separately by both the Commonwealth and the State, adding substantially to the cost of doing business here. That would be an unfortunate result.


For all the above reasons, the Bill is flawed and should not be passed in anything like its current form.

Michael Stokes and Tom Baxter

26 March 2007

Read the Bill for yourself: http://www.parliament.tas.gov.au/bills/pdf/9_of_2007.pdf

Other legislation mentioned in this advice is at: http://www.thelaw.tas.gov.au