This week the Andrews Government released its response to the Independent Inquiry into EPA Victoria. The Inquiry report was released on 16 May 2016 and recommended significant reforms in respect of the functions, powers and funding for EPA, including a comprehensive overhaul of existing environment protection legislation (see our update on the Independent Inquiry Report here).

The Government response supports 40 of the 48 recommendations in full, with seven supported in principle, and one supported in part. The reform agenda is intended to deliver, among other things, a proactive and strategic EPA focused on preventing harm to human health and the environment and increased clarity and guidance for industry about environmental protection responsibilities. This will include the introduction of a new ‘preventative duty’ similar to statutory environmental duties in other jurisdictions and work health and safety legislation.

Legislative changes to modernise the EPA’s governance and overhaul the Environment Protection Act 1970 (Vic) (EP Act) will be introduced throughout 2017 and 2018.

Further, the Government has committed $45.5 million in 2016-2017 and 2017-2018 to ‘kick start’ a five year reform program, including increased funding allocated to:

  • expanding the public health capability in the EPA to better identify, manage and communicate environmental health risks in Victoria;
  • enforcement action related to pollution (described as ‘holding polluters to account’);
  • piloting a program of local government environment protection officers to respond more effectively to local issues affecting liveability and amenity;
  • the appointment of a Chief Environmental Scientist and boosting EPA’s intelligence gathering on new and emerging risks;
  • improving digital information management to support better regulation; and
  • strengthening the EPA’s role in land use planning.

All of this points to a more active and effective environmental regulator and a significant reform agenda for environment protection legislation and policy over the next few years in Victoria. This will result in new regulatory risks (including through an immediate injection of funds into a refreshed EPA prosecution strategy, an increase in proactive enforcement, legislative reforms to introduce pollution incident reporting, increased penalties for environmental offences and possibly new contamination reporting requirements) which businesses in Victoria will now need to prepare for. Many of the proposed reforms reflect current regulatory practice in other States including NSW, so businesses have examples and experiences that can be drawn on now to start preparing for these changes.

Key recommendations

Using the same headings as our earlier update, and focusing on some of the key recommendations most likely to impact on business, we have summarised below the Government responses to those Inquiry recommendations:

Reforming the EPA’s legislation, governance and funding

  • The Government is supportive of the overhaul of the EP Act, but not a separate Establishment Act. The Act will be updated in two stages, with establishment and governance provisions of the EPA being included in a Bill to amend the Act in 2017 and the overhaul of the powers and enforcement tools being introduced in a separate amending Bill in 2018.
  • The Government supports in principle the recommendation of a separate Environment Protection (Integration and Coordination) Act to improve coordination and collaboration across government on environment protection and public health issues. However, the Government will consider a range of legislative and non-legislative mechanisms to achieve this after the overhaul of the EP Act has been completed.

EPA’s role in land use planning – including managing land use conflicts

  • The Government supports the creation of statutory mechanisms for involving the EPA earlier in strategic planning processes for a range of land uses to be defined. This will include planning scheme amendments, rezoning and structure planning, including strategic planning by the Victorian Planning Authority. The form of these triggers for the EPA involvement is to be determined.
  • The Government also supports improving the understanding and application of the EPA regulatory requirements applied through the planning system, including increased training on those requirements for planners.
  • The Government supports strengthening land use planning mechanisms to establish and maintain buffers between sensitive land uses and existing industry and other activities which present environmental and human health risks. This work is to be informed by Government responses to the recommendations of the Major Hazard Facilities Advisory Committee (not yet released) and the Animal Industries Advisory Committee (released in October 2016).

Strengthening prevention of environmental harm – general duty and mandatory notification of pollution incidents

  • As noted above, the Government supports the introduction into the EP Act of a general ‘preventive duty’ to minimise risks of harm to human health and the environment. The Government response states that the EPA will develop guidance for how to comply with the duty in consultation with business, drawing on the general statutory environmental duties in other jurisdictions and work health and safety legislation.
  • The Government supports in principle expanding the types of activities that require a works approval or licence but notes that this requires further investigation and a comprehensive review of the Environment Protection (Scheduled Premises and Exemptions) Regulations 2007. The Government also supports the Inquiry’s recommendation to require EPA licensees to make emissions monitoring information available to the public.
  • The Government supports reform of the EP Act to require mandatory notification of pollution incidents and EPA licensees to prepare and implement pollution incident response plans, as included in the NSW model. The Government also supports fixed terms for licences and regular reviews, and a new category of post closure licences for landfills and high risk contaminating activities.

Holding polluters to account – increasing enforcement measures and penalties

  • The Government has committed $6.5 million for the EPA to develop a prosecution strategy in 2017 to maximise the effectiveness and efficiency of its existing powers. The EPA will then revise its prosecution strategy following the implementation of amendments to the EP Act to introduce the general duty.
  • The Government supports the increase of penalties for environmental offences as part of the overhaul of the EP Act. The Inquiry report recommended increases in line with NSW penalties (which for corporations is up to $1M for strict liability pollution offences, $2M where there is negligence and $5M for wilful conduct leading to an offence). The Inquiry report also recommended introducing a civil penalty regime as an alternative to prosecution which has also been supported.
  • Without promising reform, the Government supports in principle investigations into improving third party rights for review of EPA decisions and civil remedies to restrain or remedy breaches of environmental legislation.

Managing legacy risks – site contamination

  • The Government supports the development of a public database with site history information to assist with the identification of potentially contaminated sites. The database will include past uses of potentially contaminated sites, whether a statutory audit has been undertaken and actions taken following that audit. Guidance materials will be developed to assist in interpreting the information. Historical land use information held by the State Library of Victoria is presently being digitized and will be searchable on the State Library website from late 2017.
  • In one of the more comprehensive responses (which picks up the recommendations of previous advisory committees and inquiries), the Government supports the recommendations to reform and better integrate planning and environmental regulation, policy and management of legacy contaminated sites. In particular, the Government response states that changes are proposed to the EP Act and environmental and planning statutory instruments to: position the EPA and planning decision makers to identify and consistently screen potentially contaminated sites according to risks, including through expanded notification requirements, proportionate clean up requirements (and in particular a more risk-based approach to groundwater contamination), and strengthening monitoring and enforcement of audit conditions with increased transparency and clarified responsibilities. Further, the response states that these reforms will be supported by enhanced information for landowners and the community, improved guidance and training to support local government decision making, and targeted facilitation measures to attract investment in renewal of contaminated sites and precincts.

Strengthening EPA’s role in mining regulation

  • The Government supports in principle the Inquiry’s recommendations to strengthen and formalise the EPA’s role in mining regulation under the Mineral Resources (Sustainable Development) Act 1990. In addition to restating and affirming the Government’s existing program of legislative and policy reform in response to the Hazelwood Mine Fire Inquiry, in the response, the Government newly committed to:
    • alongside the proposed overhaul of the EP Act - legislating requirements for mining work plan applications and variations, including rehabilitation plans, to be referred to the EPA for determination of appropriate environmental management conditions related to waste and pollution (i.e. controls to protect air, water and land quality and minimise noise);
    • establishing clear and easy to use environmental standards under the EP Act, and clarifying that the standards apply to mining over the lifecycle of a mine, with these standards used to set environmental conditions in work plans; and
    • undertaking more joint inspections by the EPA with the Department of Economic Development, Jobs, Transport & Resources’ Earth Resources Regulation unit of high risk mine sites.

Next steps

The Government has appointed an interim advisory board headed by EPA Chairman Cheryl Batagol to support the EPA through this reform process. The Government has committed to thorough consultation, which will no doubt include the Department of Environment, Land, Water and Planning and EPA conducting targeted stakeholder consultation through industry and professional associations and broader consultation on a number of specific reforms.