Details of the Financial Framework (Supplementary Powers) Amendment (Environment and Energy Measures No. 2) Regulations 2017

 

Section 1 - Name

 

This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Environment and Energy Measures No. 2)
Regulations 2017.

 

Section 2 - Commencement

 

This section provides that the Regulations commence on the day after registration on the Federal Register of Legislation. 

 

Section 3 - Authority

 

This section provides that the Regulations are made under the Financial Framework (Supplementary Powers) Act 1997.

 

Section 4 - Schedules

 

This section provides that the Financial Framework (Supplementary Powers) Regulations 1997 are amended as set out in the Schedules to the Regulations.

 

Schedule 1 - Amendments

 

Item 1 - In the appropriate position in Part 4 of Schedule 1AB (table)

 

This item adds a new item to Part 4 of Schedule 1AB to establish legislative authority for government spending on a scheme that is the responsibility of the Department of the Environment and Energy.

 

New table item 214 establishes legislative authority for the Government to fund the Surf Life Saving Cleaner Outboard Engines Scheme (the Scheme).

 

Under the Scheme, grants will be provided to surf life saving clubs to upgrade their existing outboard engines to cleaner, more efficient outboard engines that have lower fuel consumption.  Greater uptake of such engines by surf life saving clubs will, in turn, lead to lower greenhouse gas emissions.  The United Nations Framework Convention on Climate Change [1994] ATS 2 (the UNFCCC), and other international agreements, include a range of obligations on Australia to take domestic actions that reduce Australia's emissions of greenhouse gases.

 

In addition, the Scheme will help surf life saving clubs meet their obligations under proposed national emissions standards for non-road spark ignition engines and equipment (such as outboard engines), when these standards come into force.  Implementation of these standards forms part of the National Clean Air Agreement (the Agreement) which was endorsed by Australia's Environment Ministers in December 2015.  The Agreement's aim is to address the impacts of air pollution on human and environmental health and to ensure that the community continues to enjoy clean air.  One of the emissions reduction measures under the Agreement's initial work plan is establishing emission standards for, among others, this kind of engine.  Such engines generally do not have the same advanced emission controls found in on-road engines, so they are high polluters relative to their size.  Currently in Australia, there are no direct controls of emissions from these products.  The emissions standards under the Agreement are proposed to be based on United States Environmental Protection Agency and equivalent international standards.

 

The Scheme will be administered by Surf Life Saving Australia, on behalf of the Department of the Environment and Energy, which will deliver grants to participating surf life saving clubs to purchase appropriate outboard engines.  Grants will be up to $1,000 per engine.  A total of up to $1 million will be made available over four years commencing from 2016-17.

 

Funding of $1 million was included in the 2016-17 Mid-Year Economic and Fiscal Outlook under the measure 'Support Your Local Parks and Environment' for a period of four years commencing in 2016-17.  Details are set out in the Mid-Year Economic and Fiscal Outlook 2016-17, Appendix A: Policy decisions taken since the 2016 PEFO at page 156.

 

The Scheme was announced on 21 May 2016 as an election commitment by the Prime Minister, the Hon Malcolm Turnbull MP, and the then Minister for the Environment, the Hon Greg Hunt MP.  The Scheme formed part of 'The Coalition's Policy to Support Your Local Parks and Environment' which is available at https://www.liberal.org.au/coalitions-policy-support-your-local-parks-and-environment.

 

The Scheme will be delivered through a one-off, non-competitive grant process.  The Department will develop guidelines for the Scheme which will be run in accordance with these guidelines, and also in accordance with the Commonwealth Grants Rules and Guidelines.  The Scheme guidelines will contain eligibility and assessment criteria, prior to the commencement of the Scheme, and provide that grants will be limited to upgrades to outboard engines that comply with the proposed national emission standards. 

 

The decision-maker under the Scheme will be the Minister for the Environment and Energy.

 

Under the Commonwealth Grants Rules and Guidelines, details of the grants will be published by the Department of the Environment and Energy at
http://environment.gov.au/about-us/accountability-reporting/grants-listing.

 

The Scheme is not considered suitable for independent merits review because it will be delivered through targeted funding to surf life saving clubs and involves the allocation of finite resources.  Since the Scheme has limited funds, only a proportion of applications may be met.  The re-making of a decision under merits review would necessarily affect allocations available to other parties.  An application for merits review also may result in delays in the provision of grants to recipients.

 

The guaranteed right of review under section 75(v) of the Australian Constitution, and review under section 39B of the Judiciary Act 1903, would still be available.  Persons affected by spending decisions would also have recourse to the Commonwealth Ombudsman where appropriate.

 

 

Funding for this item will come from Program 1.6: Management of Hazardous Wastes, Substances and Pollutants, which is part of Outcome 1.  Details are set out in the Portfolio Additional Estimates Statements 2016-17, Environment and Energy Portfolio at pages 10, 16, 18 and 29.

 

Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the external affairs power (section 51(xxix)) of the Constitution.

 

The external affairs power in section 51(xxix) of the Constitution supports legislation implementing treaties to which Australia is a party.

 

The UNFCCC includes a range of obligations on Australia to take domestic actions that reduce Australia's emissions of greenhouse gases.  The UNFCCC relevantly provides that Australia shall:

*         formulate, implement, publish and regularly update national and, where appropriate, regional programs containing measures to mitigate climate change by addressing anthropogenic emissions by sources and removals by sinks of all greenhouse gases not controlled by the Montreal Protocol, and measures to facilitate adequate adaptation to climate change (Article 4.1(b));

*         promote and cooperate in the development, application and diffusion of technologies, practices and processes that control, reduce or prevent anthropogenic emissions of greenhouse gases in all relevant sectors including energy, transport, industry, agriculture, forestry and waste management sectors (Article 4.1(c)); and

*         adopt national policies and take corresponding measures on the mitigation of climate change, by limiting its anthropogenic emissions of greenhouse gases and protecting and enhancing its greenhouse gas sinks and reservoirs (Article 4.2(a)).

 

The Kyoto Protocol to the United Nations Framework Convention on Climate Change [2008] ATS 2 also includes obligations on Australia to take action to reduce emissions, such as Articles 3 and 10(b).  Article 3 imposes obligations to ensure that Australia's greenhouse gas emissions during the commitment period do not exceed its assigned amount.  Article 10(b) imposes obligations to formulate, implement and report upon climate change mitigation and adaptation programmes.

 

The Paris Agreement [2016] ATS 24 was entered into by the parties to the UNFCCC to enhance its implementation.  Under the Paris Agreement, Australia has a 'nationally determined contribution' of a 2030 emissions reduction target of 26 to 28% below 2005 levels.  Relevantly, Article 4.2 of the Paris Agreement provides as follows:

*         Each Party shall prepare, communicate and maintain successive nationally determined contributions that it intends to achieve.  Parties shall pursue domestic mitigation measures, with the aim of achieving the objectives of such contributions.

 

Under the Scheme, grants will be made available to surf life saving clubs to replace outboard engines with cleaner ones that, among other things, produce lower greenhouse gas emissions.

Statement of Compatibility with Human Rights

 

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Financial Framework (Supplementary Powers) Amendment (Environment and Energy Measures No. 2) Regulations 2017

 

These Regulations are compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Overview of the Legislative Instrument

 

Section 32B of the Financial Framework (Supplementary Powers) Act 1997 (the FF(SP) Act) authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the FF(SP) Regulations) and to make, vary and administer arrangements and grants for the purposes of programs specified in the Regulations.  Schedule 1AA and Schedule 1AB to the FF(SP) Regulations specify the arrangements, grants and programs.  The FF(SP) Act applies to Ministers and the accountable authorities of non-corporate Commonwealth entities, as defined under section 12 of the Public Governance, Performance and Accountability Act 2013. 

 

The Regulations amend Schedule 1AB to the FF(SP) Regulations to establish legislative authority for the Government to fund the Surf Life Saving Cleaner Outboard Engines Scheme which was announced during the 2016 federal election.  The Department of the Environment and Energy has responsibility for the Scheme. 

 

Grant funding of up to $1 million over four years will be provided to surf life saving clubs for the replacement of their current outboard engines with cleaner outboard engines to reduce their running costs and lower greenhouse gas emissions.  Grants of up to $1,000 per engine will be available.

 

The Minister for the Environment and Energy has portfolio responsibility for the Scheme.

 

Human rights implications

 

The Regulations do not engage any of the applicable rights or freedoms.

 

Conclusion

 

These Regulations are compatible with human rights as they do not raise any human rights issues.

 

 

 

Senator the Hon Mathias Cormann

Minister for Finance