1 October 2015
Post Implementation Review – Department of the Treasury
As part of the 2011-12 Budget, the then Government announced the Minerals Resource Rent Tax (MRRT) and a number of related tax measures.
The MRRT was a profits tax levied at an effective rate of 22.5 per cent of mining profits over $75 million for coal and mining projects within Australia. Two of the related measures included in the package of tax reforms were the immediate write‑off of geothermal exploration expenses and accelerated depreciation for motor vehicles.
These three proposals were assessed by the Office of Best Practice Regulation (OBPR) as likely to have a measurable impact on the economy and therefore should have been subject to the preparation of a Regulation Impact Statement (RIS). However, the then Prime Minister granted exceptional circumstances to the proposals which exempted the Treasury from the requirement to prepare a RIS. Consequently, a Post Implementation Review (PIR) was required to be undertaken for these regulations in line with the Government’s best practice regulation guidelines. The proposals were implemented in July 2012.
In 2013, in preparation for the repeal of the MRRT and related measures, the Treasury undertook a review of the appropriateness, effectiveness and efficiency of these regulations in the form of a RIS. The RIS was assessed as compliant with the RIS requirements by the OBPR. In order to meet the Government’s PIR requirements for the three proposals, in October 2014 the Treasury certified that the analysis in the RIS satisfied the requirements of the PIR, which is consistent with the Government’s Guide to Regulation. This certification process was assessed as compliant by the OBPR.
1 October 2015
Regulation Impact Statement – Department of Foreign Affairs and Trade
On 17 June 2015, Australia’s Trade and Investment Minister and the Chinese Commerce Minister signed the China-Australia Free Trade Agreement (ChAFTA).
Negotiations on a free trade agreement with China commenced in May 2005. Following 21 formal rounds of negotiations, then Prime Minister Tony Abbott and President Xi Jingping announced the conclusion of negotiations on 17 November 2014.
In 2014, two-way trade in goods and services reached $152.5 billion, making China Australia’s largest trading partner. The Office of Best Practice Regulation (OBPR) considers that ChAFTA is likely to be of major significance to the broader economy with significant impacts on competition.
Significant barriers to Australian agricultural exports will be removed across a range of products including beef, dairy, lamb, wine, hides and skins, horticulture, barley and seafood. The reduction or elimination of tariffs on Australian exports to China under ChAFTA is expected to increase demand in China for goods produced in Australia.
A Regulation Impact Statement (RIS) was prepared and certified by the Department of Foreign Affairs and Trade, and has been assessed as compliant by the OBPR.
However, the OBPR considers that the RIS was not consistent with best practice because it did not contain a degree of detail and depth of analysis that is commensurate with the likely impacts of the proposal.
As the free trade agreement has been assessed by the OBPR as having a substantial impact on the economy, the Australian Government RIS process requires a post-implementation review to be completed within five years of ChAFTA being implemented.
The RIS estimates the average annual regulatory net saving at $1,350 per annum. The OBPR has agreed to the regulatory saving.
1 October 2015
Post‑implementation Review – Department of Communications
On 26 June 2012, the then Minister for Broadband, Communications and the Digital Economy made a decision to extend the expiry date for Telstra’s retail price controls by two years from 30 June 2012 to 30 June 2014.
Telstra’s retail price controls applied to most Telstra fixed line telephony services, and were designed as price caps that aimed to address a potential lack of competitive tension in fixed line service pricing, promote greater social equity and ensure that efficiency gains were passed on to retail customers. Since this decision to extend the expiry date on the retail price controls, the Minister for Communications revoked these controls on 18 March 2015.
The proposal was assessed as likely to have a significant regulatory impact on the economy, and was therefore subject to the preparation of a RIS. However, an exemption from the best practice regulation requirements was granted by the then Prime Minister. This exemption also required the Department of Communications to prepare a post-implementation review (PIR) within two years of implementation.
The proposal was implemented in June 2012. A post-implementation review (PIR) was completed by the Department of Communications in July 2015 and was assessed as compliant by the Office of Best Practice Regulation.
The PIR found that over the two year period of the extension, the regime imposed an annual regulatory burden of $0.246m with no discernible impact on prices. Therefore, the decision to extend the Telstra retail price controls imposed a net economic cost on the community.
1 October 2015
Regulation Impact Statement – Department of Agriculture
On 4 July 2015, the Australian Government released the Agricultural Competitiveness White Paper setting out actions for the agricultural sector in five priority areas including strengthening the approach to drought and risk management.
Among the initiatives to assist Australian farmers prepare for and manage through drought and other hardship were the following agriculture measures providing:
- rebates for insurance and risk advice;
- drought concessional loans;
- increased Farm Household Allowance case management for recipients in their third year of payment;
- increased rural financial counselling services in drought-affected areas;
- improved access to social and community mental health support; and
- pest and weeds management in drought-affected areas.
A Regulation Impact Statement (RIS) prepared by the Department of Agriculture on the assistance measures has been assessed as compliant and consistent with best practice by the Office of Best Practice Regulation (OBPR).
The RIS estimates the total average annual regulatory costs at about $95,000 per annum. The OBPR has agreed to the regulatory estimate and associated offsets for the measures.
29 September 2015
Regulation Impact Statement – Department of the Environment
On 25 June 2015, the Government made changes to the National Television and Computer Recycling Scheme (the Scheme).
Under the scheme, the television and computer industries are required to fund collection and recycling of a proportion of the televisions and computers disposed of in Australia each year. This proportion increases in stages to a peak of 80 per cent of all imports.
The changes to the Scheme aim to improve the operation of the scheme, including by providing stability to the recycling industry and maintaining employment of disadvantaged workers.
These changes include flattening the speed of growth in the volume of recycling that the television and computer industries are required to undertake (so that more recycling is required in the near future and less in outward years), and requiring recyclers participating in the scheme to gain additional accreditation with regards to environmental and work health and safety outcomes.
The Office of Best Practice Regulation (OBPR) considers the Department of the Environment is compliant with the Government’s RIS requirements and best practice. The Department of the Environment estimates the average annual regulatory savings of the proposal to be $7.057 million and this has been agreed with the OBPR.
18 September 2015
Regulation Impact Statement – Department of Employment
On 1 July 2015, the Australian Government announced the start of jobactive, the new government-funded employment services model. It is delivered by contracted providers which assist eligible job seekers to prepare for and find employment, as well as to comply with various requirements in return for income support.
The new model varies from the previous employment services arrangements in place since July 2009, Job Services Australia. The key objective of jobactive is to promote stronger workforce participation by people of working age and help more job seekers move from welfare to work.
The changes are intended to improve job outcomes, better meet the needs of employers, increase job seeker activation and reduce service prescription and red tape. Principal changes under jobactive are contracting of a smaller number of providers, larger servicing regions, longer contract terms, a greater emphasis on outcomes in the payment and performance frameworks for providers, requirements for providers to monitor job seekers’ job search, and use of new information technology to reduce administrative and compliance burdens.
A Regulation Impact Statement (RIS) was prepared and certified by the Department of Employment. The RIS is not yet compliant with the Government’s RIS requirements as the former Prime Minister granted the Department an extension of time for the preparation of regulatory cost burden estimates. These will need to be agreed by the Office of Best Practice Regulation (OBPR) by 30 September 2015.
The OBPR will provide a final assessment of the RIS when the regulatory cost estimates are agreed.
17 September 2015
Regulation Impact Statement – Australian Securities and Investment Commission
On 28 July 2015, the Australian Securities and Investment Commission (ASIC) released new waivers from the law and new guidance to make it easier for financial service providers such as banks, wealth management and superannuation providers to communicate with their customers digitally.
Previously, specific agreement had to be made for account statements and financial disclosure documents to be sent digitally (while documents sent by post did not require specific agreement). The changes mean that documents may be sent to any address provided by a customer (including a postal or email address) and will allow providers to publish these documents digitally, and notify customers that they are available. Customers must be given the opportunity to opt out of digital communication. This is expected to significantly reduce costs for banks and other financial institutions in sending letters.
A Regulation Impact Statement (RIS) was prepared and certified by ASIC, and has been assessed as compliant and consistent with best practice by the Office of Best Practice Regulation (OBPR).
The RIS estimates the average annual regulatory saving at $299.1 million per annum. The OBPR has agreed to the regulatory saving.
16 September 2015
Post–implementation Review – Attorney-General’s Department
In the 2011-12 Budget, the then Government announced its response to the findings of the 2010 Review of the Australian Screen Production Sector. The key elements of the measure included:
- providing support to a wider range of productions to increase the film tax offsets’ effectiveness as production incentives;
- aligning the scope of qualifying Australian production expenditure prescribed in the legislation with standard industry practices;
- improving mechanisms for supporting documentary productions; and
- funding for a comprehensive screen industry survey to be undertaken by the Australian Bureau of Statistics.
A Regulation Impact Statement (RIS) was required but not prepared before the decision to implement the measure was taken. Consequently, a Post-Implementation Review (PIR) was required.
The PIR found that the measure benefited Australian producers, Australians working in the screen industry and related vendors, and was received favourably by the sector. Applications for the Post, Digital and Visual Effects offset and the Producer offset increased as a result of relaxing eligibility conditions, reducing expenditure thresholds and increasing offset rates.
The PIR was assessed as compliant by the Office of Best Practice Regulation. The PIR estimates the regulatory savings of the measure at $190,000 per annum.
16 September 2015
Post–implementation Review – Australian Transaction Reports and Analysis Centre (AUSTRAC)
On 27 October 2011 the then Government added Chapters 58 and 59 to the Anti-Money Laundering and Counter-Terrorism Financing Rules relating to the cancellation and suspension of remittance dealer registrations.
- Chapter 58 specifies the matters that the Australian Transaction Reports and Analysis Centre Chief Executive Officer (AUSTRAC CEO) must consider when deciding whether or not to cancel the registration of a person who provides registrable designated remittance services or registrable remittance network provider services.
- Chapter 59 specifies the grounds on which a person may be suspended from registration for a period of time as determined by the AUSTRAC CEO.
A Regulation Impact Statement (RIS) was required but not finalised before the decision to introduce the new chapters was taken. Consequently, AUSTRAC was found to be non-compliant with the Government’s RIS requirements and was required to undertake a Post-Implementation Review (PIR).
The PIR found that the chapters have been effective in reducing the incidence and risk of misuse of remittance funds and serious crime related to remittance transactions, preventing high-risk remittance dealers from operating, or continuing to operate, as remittance dealers; and protecting the commercial significance of the remittance sector in Australia’s financial system.
Law enforcement agencies see the chapters as being an important means to disrupt actual and potential criminal activity relating to money-laundering, terrorism-financing and people-smuggling in the remittance sector. Submissions from industry indicated that the Chapters have minimal impact on legitimate remitter service providers.
The PIR was assessed as compliant by the Office of Best Practice Regulation. The PIR estimates the regulatory costs of the introduction of the two Chapters at zero.
16 September 2015
Regulation Impact Statement – Department of Infrastructure and Regional Development
The Government has amended the Airports Act 1996 to remove the airport cross-ownership restrictions placed on Sydney West Airport (SWA).
The Airports Act 1996 provides that airport-operator companies are subject to a 15 per cent limit on cross-ownership of certain airports. The aim of the restrictions is to ensure diversity of ownership and control of certain major airports as specified in the Act. In relation to SWA, the 15 per cent limit on cross-ownership applied to the following pairs of airport-operator companies (section 49): SWA and Brisbane Airport; SWA and Melbourne (Tullamarine) Airport; and SWA and Perth Airport.
A Regulation Impact Statement (RIS) was prepared and certified by the Department of Infrastructure and Regional Development, and has been assessed as compliant by the Office of Best Practice Regulation (the OBPR).
The OBPR advises that the preparation of the RIS was not consistent with best practice as the RIS required a higher level of analysis. In particular, the RIS does not explain the purpose of the cross-ownership restrictions, or the competition problem that they seek to address.
The RIS estimates that the average annual regulatory cost is zero. The OBPR has agreed to the estimate.