KEY POINTS

  • The Environment Protection Authority in Victoria faces proposed reforms to its regime.
  • The proposals will remain until the Victorian Government confirms its response, which is expected later this year.

​Following eight months of consultation and deliberation, the Victorian Ministerial Advisory Council (MAC) tasked to review the operations of Victoria’s 45-year-old Environment Protection Authority (EPA) has identified 48 potential reforms to the EPA’s current approach. Despite the proposed reforms, it is widely accepted that Victoria’s regime has fallen well behind most other Australian jurisdictions, particularly in respect of mandatory reporting for environmental incidents, and many national organisations will already be well-placed to adapt to any new regime.

Proposed reforms to the regime include:

  • an enforceable general duty to prevent environmental pollution and minimise waste;
  • improved inspection and enquiry powers for the EPA; and
  • stronger and more flexible range of sanctions.

A general duty to prevent pollution, steeper penalties and greater use of licences could be on the cards if proposed reforms are taken up by the Victorian Government. If implemented, this would be the most comprehensive reform agenda in environment law since the Environment Protection Act 1970 (Vic) (EP Act) was first introduced.

In this article we identify the key reforms that may impact on employers’ current approach to compliance in Victoria’s environment protection regime.

General duty to protect Victoria’s environment and increases to penalties

Many of the proposals look to Victoria’s occupational health and safety regime as the appropriate model. In particular, the MAC has recommended the adoption of a general and enforceable duty to “prevent pollution and waste”, comparable to the general duty of employers to maintain a safe workplace, which accounts for the bulk of the prosecutions conducted by WorkSafe Victoria, and similar to the general duty of prevention seen in South Australian environmental protection legislation.

The key elements of the MAC’s proposal for the general duty are:

  • an obligation on all persons to take all reasonably practicable steps to minimise pollution and waste;
  • statutory codes of practice and advice to guide compliance;
  • remedial notices for addressing immediate non-compliance; and
  • criminal and civil sanctions and civil remedies to enforce the duty generally.

As with employers’ general duties regarding occupational health and safety, the MAC proposals envisage that compliance will require organisations to undertake hazard identification and risk assessment before implementing risk control measures.

The MAC has also recommended increasing the maximum penalties for criminal offences, allowing courts to consider the economic benefits an accused has enjoyed from non- compliance with environmental laws, and increasing the EPA’s resources to enable more timely prosecutions.

If adopted, the MAC has recommended a staged approach to this duty, starting with EPA licence holders and entities subject to WorkSafe’s dangerous goods notification regime before extending the general application of the duty.

To support enforcement of a general duty, the MAC has also recommended introduction of “remedial notices” to replace the current “pollution abatement notices” which will operate in much the same way as an improvement notice under the Victorian safety legislation. 

Critically, these notices could be issued directly by EPA inspectors, avoiding the current processes required to issue a pollution abatement notice. Where an inspector observed an immediate threat to the environment, then under the MAC’s proposal, they would have a power to issue a prohibition notice that would have immediate effect.

Officer liability

The MAC report makes no mention of any changes to “officer liability”. This is despite recent guidance provided by EPA itself indicating that it expects officers of an organisation to take a positive “due diligence” approach to environmental compliance that is comparable to the obligations under the model work health and safety (WHS) laws.1

As with the current EP Act, the proposed obligations will apply to all persons, whether a corporation or an individual. However, the EP Act also presumes each officer of an organisation to be guilty of any offence of the organisation and provides that they will be personally liable for the same penalty unless they prove that he or she was not in a position to influence the conduct or that they had used all due diligence to prevent the contravention.

The EP Act specifically identifies directors and any person concerned in the management of a corporation to be potentially responsible for a contravention as officers.

If the EP Act is recast as part of the reform process, then we might expect adoption of  the stand-alone WHS-style due diligence obligations. In the meantime, officer liability remains tied to offences attributable to the organisation, although an individual officer could also be personally and separately responsible for an offence if they have direct involvement in the offence.

Mandatory reporting and incident response preparedness

As widely expected, the MAC has recommended Victoria introduce mandatory reporting of environmental incidents. This will align Victoria with all other Australian jurisdictions.

The policy is largely in place to ensure that in the event of an incident the regulator is involved early in the process to maximise any mitigation actions that may limit the extent of environmental damage. The EPA has broad powers that enable it to intervene in an incident to access adjacent properties, isolate drainage conduits, and establish containments. For serious incidents, this could mean mitigation of the impacts which could help limit the liability to the polluter. We have seen examples of this recently with the overturning of tankers on public roads where the EPA has acted to limit the spread of the tanker contents.

Along with mandatory reporting, the MAC has recommended that pollution incident planning be a mandatory requirement for EPA licence-holders (citing the NSW example as a suitable model). The MAC also indicated that incident planning should be considered a “reasonable step” for any organisation seeking to discharge its general duty to prevent pollution. As such, we eventually expect to see all organisations adopting a level of incident planning to demonstrate compliance with the positive general duty.

Reform to regulations and environment protection policies

The MAC has recognised that many of the State environment protection and waste management policies are drafted in a highly technical manner, rendering them difficult to implement from an individual duty-holder’s perspective. Whilst a valid observation, the technicality does, at least in part, represent the inherent complexity of creating State- wide regulations for environmental matters, which are continuously changing. The MAC also recognises the importance of EPA remaining a science-based regulator.

That said, reform of these policies will come as a welcome relief to many duty holders and environmental practitioners. On the flipside, easier implementation and likely easier enforcement and simplification will come with increased expectations for compliance with a general duty. Broadly, the MAC has recommended a division of the process of developing such policies between:

  • the Department of Environment, Land, Waste and Planning (DELWP), which would set the overarching policy objectives; and
  • the EPA, which would retain responsibility for setting the technical standards.

Broadening the environment protection regime

In recognition of the wide geographic spread of environmental impacts, the MAC has recommended an increased role for local government in inspecting and enforcing statutory obligations around Victoria. This would include increased funding to local government to undertake enforcement activities. It would also mean more “boots on the ground” observing potentially damaging practices and taking enforcement action.

Other proposals to create a more integrated and responsive regime include new legislation to create an overarching regime for environment protection and management led by DELWP. Such legislation could cover:

  • entities directly responsible for the environment, including pollution, waste, biodiversity and climate change (e.g. DELWP, EPA, Parks Victoria, and water authorities);
  • areas that consider environmental issues in decision making (e.g. planning and major infrastructure agencies); and
  • areas that manage environmental risks to human health (e.g. WorkSafe and the Department of Health and Human Services).

Next steps

Ultimately, the proposals recommended by the MAC will remain proposals until the Victorian Government confirms its response, which is expected later this year.2  Further, the delicate balance of power in Victoria’s legislative council may also be an important factor in determining the extent of reform, with that power being held variously by the Greens, the Shooters and Fishers, Vote 1 Local Jobs and the Sex Party.