John Williams (NSW, National Party) Share this | Link to this | Hansard source

As Chair of the Senate Standing Committee on Regulations and Ordinances, I present the Delegated Legislation Monitor No. 11 of 2015.

Ordered that the document be printed.

I move:

That the Senate take note of the document.

In my capacity as Chair of the Standing Committee on Regulations and Ordinances to make some comments on a matter raised in the committee's current report, the Delegated legislation monitor No. 11 of 2015.

At the outset, I would remind senators that the role of the committee is to examine all disallowable instruments of delegated legislation to ensure that they comply with the committee's scrutiny principles.

In broad terms, these scrutiny principles are intended to ensure that the Senate retains effective oversight of the Parliament's legislative power, when that power is exercised by ministers and other officials in making instruments of delegated legislation.

In this respect, the committee approaches its work as a bipartisan and technical inquiry. The committee therefore does not consider whether the particular policy being implemented by an instrument is desirable or not—it simply examines each instrument to ensure that it does not breach the committee's scrutiny principles.

With this in mind, I would like to draw the attention of the Senate to the committee's current examination of the Corporations Amendment (Financial Advice) Regulation 2015.

This regulation makes a number of amendments to the Corporations Regulations 2001, relating to the Future of Financial Advice (FOFA) provisions of the Corporations Act. The Assistant Treasurer has advised the committee that the amendments arise from the disallowance of a previous instrument—the Corporations Amendment (Streamlining Future of Financial Advice) Regulation 2014—on 19 November 2014.

The disallowance of that instrument has reportedly caused some disruption to the financial advice industry, and in that regard the current regulation is intended to 'provide certainty to industry as quickly as possible' until the measures can be enacted through primary legislation. A bill for that very purpose—the Corporations Amendment (Streamlining of Future of Financial Advice) Bill 2014—is currently before the Senate.

Naturally, the committee appreciates that ministers often have to deal with matters that present practical considerations for the regulation of industries under their portfolios. However, the making of regulations to effectively anticipate the consideration and determination of proposed legislation in the Senate—as is being done in this case—raises an important matter of principle for the Regulations and Ordinances Committee.

In particular, pre-emptive regulations of this type can lead to a situation where the regulation does not ultimately reflect the will of the Senate, as expressed by its consideration of the subsequent bill.

For example, if the subsequent bill is not passed, or is passed with amendments that do not reflect the substance of the pre-emptive regulation, the regulation will continue in force despite the fact it does not reflect the outcome of the Senate's determination of the bill.

To address the potential for outcomes like this, the members of the committee agree that it is important that in these cases the fate of the subsequent bill is determined by the Senate within the period that the pre-emptive regulation remains open to disallowance. This protects the ability of the Senate to disallow the instrument in the event that the subsequent bill is not passed, or is passed with amendments that do not reflect the substance of the regulation.

Applying these considerations to the current instrument being examined by the committee, I draw senators' attention to the committee's decision to give a notice of motion for disallowance of the current regulation. This notice has the effect of extending the disallowance period for the regulation by a further 15 sitting days—a period which the committee expects will provide sufficient time for the fate of the current Future of Financial Advice Bill to be determined by the Senate.

These remarks I hope draw senators' attention to an important principle of the Regulations and Ordinances Committee's work, and I commend the committee's report to the Senate.

Question agreed to.