Kate Chaney (Curtin, Independent) Share this | Hansard source

The Environment Protection Reform Bill 2025 and the six accompanying bills are part of a long-awaited package of reforms to fix our deeply flawed environmental laws. I want to talk about how we got here, the good parts of the bills and the most concerning loopholes that could undermine the bills' effectiveness.

Our environmental protection laws were written last century. Everyone agrees they are not fit for purpose. It's rare to find agreement in this building, but on this matter there is consensus. Our environmental laws do not protect nature and do not work for business. More than 48 per cent of the continent is now degraded, and more than 70 per cent of our most diverse regions are devoid of native vegetation.

Environmental protection is one of the top three issues constituents contact me about, with thousands of constituents writing to me in the last three years, concerned that the places they love are not being adequately protected. At the same time the timelines for development have blown out, in large part because of the duplication and inefficiencies in our environmental laws.

To meet the challenges our country faces today—climate change, cost of living and housing—we need to be able to build, and build quickly. We need renewable energy to reduce our emissions and bring down the cost of electricity. We need more houses for Australians to call home. Yet we're consistently underdelivering. In the last quarter, zero large-scale projects reached financial close. Nationally, we continue to underdeliver on housing targets. This is why EPBC Act reform is essential. With our natural world and ecosystem degrading and delays holding up vital developments, we need a change.

Despite the importance and complexity of this issue, the government dropped 1,500 pages of legislation on us on Thursday for debate this week. It's now Tuesday. This makes a mockery of the role of the House of Representatives, which is to deliberate on legislation and hold the government of the day to account. Despite this, I have done my best to review the legislation, speak to a wide range of experts, identify what's good and not so good in the legislation and propose and draft amendments. The Senate is due to report back in March. While these reforms are urgent, I urge the government to wait for the Senate inquiry. We've been waiting for these reforms for 25 years. It's worth waiting a couple more months to get this right.

There are some positive changes in this reform package for both business and the environment. For businesses, assessment pathways will be streamlined, with three different processes replaced by a single pathway. This will mean that businesses are spending less time and money on navigating the assessment processes and waiting for an answer. We'll have bioregional plans with 'go' and 'no go' zones. Not only does this more holistically protect nature; it also provides greater certainty and streamlined assessment processes for businesses.

And there are some wins for nature. For the first time, unacceptable impacts have been defined. If the damage is bad enough, a project should not be able to go ahead. That's a positive step. And we'll have a clear, legislated mitigation hierarchy for the first time. This means that project proponents have to try to avoid negative impacts and then minimise the unavoidable impacts, and only then can they go to restore or offset the residual impacts. Projects can't just jump straight to offsets. When they do go to offsets, proponents need to show a net gain for the environment. So the overall impact must be better for nature, not just slow the decline.

These are all good changes. But there are some very large loopholes that could undermine these benefits. The two I'm focusing on are the integrity of offsets and the national interest exemptions. I'm very open about how to deal with these problems, but they have to be addressed. On offsets, if a project proponent wants to use offsets, where they've tried to avoid or minimise the damage but there's a residual impact, there are two ways they can approach this. They can invest in an offset project directly, or they can pay money into an offsets fund managed by the Restoration Contributions Holder. The intention is that this offsets fund is used to purchase offsets to compensate for the damage caused by the proponents.

The EPBC reforms intend to include some good standards for direct offset projects, including requirements that offsets are like for like, additional, and ready to deliver compensation before the damage occurs. But it appears that these standards won't apply for projects funded through the offsets fund. This raises questions about how we ensure that this offsets fund delivers for nature. Funds like this have not worked in the past. We've seen funds in New South Wales, Queensland and the Pilbara that have failed to deliver real restoration of the environment.

But why does this happen? It's not about idea and principle. You make it easier for businesses to compensate for their environmental damage by paying into a government fund that can then use its fund—and, hopefully, its expertise in conservation—to strategically and more effectively invest in environmental offsets. But in practice they just don't seem to work. Developers damage the environment and pay into the fund, but the funds always seem to underdeliver on offset projects. This leads to a situation where developers effectively pay to destroy. They pass on their liability to the offsets fund, which then is unable to find suitable offsets. At the end of the day, it's nature that bears the cost. Globally, funds like these are increasingly considered inappropriate to justify the destruction of intact native ecosystems like we have in Australia.

I'll be proposing amendments to tighten up the use of this fund. If we consider the comparable funds in New South Wales, Queensland, the Pilbara and overseas, there are a number of consistent lessons to be learned. Firstly, we need to limit the use of the offsets fund. It should be a last resort for developers. Otherwise, the funds simply can't purchase enough offsets to keep up with the damage caused by developments. I'm drafting an amendment that requires projects to use the offsets fund only if they're unable to purchase offsets directly. Effectively this introduces another layer into the mitigation hierarchy: first avoid damage, then mitigate, then directly offset, and only then can you pay into the offsets fund.

Another potential solution would be to require large projects that have significant resources to directly offset rather than using the fund. While the offset fund is a great solution for small developers that don't have the capacity to find suitable offsets, large multibillion-dollar companies absolutely have the capacity to secure the offsets themselves rather than pay to pass the liability onto the fund. A cash payment is obviously easier than actually doing the work to offset damage. Without limitations on when the offset funds can be used, all proponents will go for the easy option. Both of these proposed solutions would reduce the use of the offset fund, minimising the risk that it's unable to deliver for nature.

Secondly, we've often seen that offset funds are unable to find suitable offsets for the damage caused. The developer pays into the fund for damage to a wetland and passes on its liability. Then, when the offset fund looks for a suitable wetlands offset project, it discovers that none are available. I'm introducing an amendment to ensure that the offsets fund is used only when it's likely that appropriate offsets will be available. If they're not going to be available, the project should be revisiting the damage it's causing. A second amendment creates an excluded matters list—a list of species and ecosystems that are so close to extinction that the fund will never be able to find suitable offsets. Proponents should not be permitted to damage species and ecosystems on the excluded matters list and then make it the fund's problem by making a cash payment.

Thirdly, we need to ensure that offsets are priced appropriately. There's a long history of underpricing environmental offsets, and it's always nature that cops the bill. Offsets need to be appropriately priced so that the fund has sufficient capital to purchase offsets that compensate for the damage caused and deliver a net gain. This legislation does not set out the price for offsets but provides for regulations that will determine the price. I'm introducing amendments that require a regular review of the offsets price calculator. I also believe the legislation should outline a set of factors that must be considered in the offsets price calculator, such as administration costs, logistical costs and accounting for the risk of failure. If we get the pricing wrong, the offsets fund becomes ineffective.

Fourthly, we need greater transparency on what this fund is actually achieving through public reporting. If it's not working, it must be changed. The offsets fund reports on the progress of its offsets to the minister every year, and I'm introducing an amendment to ensure that this report is made publicly available. It will be vital that there is scientific oversight of this process. I would suggest that the legislation should also specify that the restoration contributions advisory committee contain significant expertise related to threatened species and ecological restoration. There may well be other ways to improve the integrity of the offsets fund, and I'm very open to considering them, but we've seen, from a range of comparable jurisdictions, that these funds can often provide a cheap way out for developers at the expense of the environment. With this legislation as it is, this offsets fund represents a potential single point of failure for the entire reform package. We must get it right.

My second major concern is about the national interest test. There are two national interest pathways. The first is called the national interest exemption. It allows the minister to declare that a project is in the national interest and allows it to bypass all environmental safeguards. It's intended to be used for natural disasters and emergencies when we need to override environmental laws. This test has always existed and has mostly been used in good faith. But this package introduces a new exemption called the national interest proposal. This appears quite similar to the national interest exemption; it allows the minister to choose to bypass almost all environmental safeguards. But this new national interest proposal appears to be intended for a much broader range of projects, including housing or energy projects. There are no limits on what the minister can consider in determining whether a project is a national interest proposal. There's a real risk that a minister could use this exemption for political reasons. We don't need this additional separate pathway. It provides an opportunity for this or a future government to completely ignore the environmental protections and declare every project to be in the national interest. And it's not great for business. You can't make long-term investment decisions on the chance that the minister will consider that your project fits the vague definition of 'the national interest'. We should be accelerating approvals by streamlining the environmental assessment, rather than introducing a sneaky bypass that's completely left to the minister. If the government is unwilling to remove the national interest proposal then, at the very least, fossil fuel projects should not be able to bypass environmental protections. I'll introduce an amendment to this effect.

When the government does exercise its discretionary power to bypass environmental laws, there should be very strong transparency in relation to that decision. These reforms allow the minister to redact information from the statement of reasons required under the current EPBC Act when the national interest exemption is used. There's no reason for more secrecy under the new laws. If the minister is going to bypass the environmental laws, the public has a right to know why.

I have a series of other concerns about these reforms that I don't have time to address. These reforms do not deal with land clearing or native forest logging. There's a huge amount of ministerial discretion. The phrase 'ministerial satisfaction' appears over 600 times in the combined bills and explanatory memoranda. They do not introduce a climate trigger or introduce climate considerations, even though climate change is the biggest threat to the environment. There are also huge uncertainties around key features of the reforms, including the safeguards for the bilateral accreditation processes, which could be an opportunity for reduced duplication if we get it right, and uncertainties about the independence and power of the national EPA, about the rigour of the national environmental standards and about the process of and community engagement in developing bioregional plans.

Despite the ridiculous timeframes and the serious concerns in these bills, I would encourage every part of the parliament to contribute constructively to this process and accept that no-one is going to get everything they want. We need to make our environmental laws work better so we can safeguard the environment and build a future that we're proud to leave to our children and grandchildren. I implore the Greens to act constructively and not let the perfect be the enemy of the good. This is an opportunity to show that you've learnt the lessons of the last election. People want outcomes, and you have a chance to deliver. I implore the coalition to show that they can be an effective party of opposition and to focus on the need to improve the laws for the environment and for business rather than use this as a pointscoring exercise. Australians are sick of the petty politics. They want to see constructive engagement and results.

Perhaps most importantly, I implore the government to act in good faith to improve this legislation and get it passed. These bills require significant amendments. This is a once-in-a-generation opportunity to reform the environmental laws that protect our environment and support our businesses. Let's get it right. I'll be working constructively with the government and others in the House and the Senate to come up with a package that can satisfy the twin imperatives of more certainty and timeliness for business and a better environment for our children and grandchildren.

I will now move a second reading amendment acknowledging the need for better outcomes for business and the environment and the need to work together and pass environmental reforms and calling on the government to amend this bill to resolve its significant flaws. I move the amendment circulated in my name:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House:

(1) acknowledges that we need to achieve better outcomes for business and the environment;

(2) further acknowledges it is in the interest of the Government, Opposition and crossbench to work constructively to pass these reforms; and

(3) calls on the Government to amend this bill to resolve significant flaws, including loopholes in the offsets framework".

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