Gasfields Commission and Other Legislation Amendment Bill 2017

Gasfields Commission and Other Legislation Amendment Bill 2017

Report No. 46, 55th Parliament Infrastructure, Planning and Natural Resources Committee July 2017

Infrastructure, Planning and Natural Resources Committee

Chair Mr Jim Pearce MP, Member for Mirani

Deputy Chair Ms Ann Leahy MP, Member for Warrego

Members Mr Craig Crawford MP, Member for Barron River

Mr Shane Knuth MP, Member for Dalrymple

Mrs Brittany Lauga MP, Member for Keppel

Mr Tony Perrett MP, Member for Gympie

Committee Secretariat

Telephone +61 7 3553 6621

Fax +61 7 3553 6699

Email [email protected]

Technical Scrutiny Secretariat

+61 7 3553 6601

Committee Web Page www.parliament.qld.gov.au/IPNRC

Acknowledgements

The committee acknowledges the assistance provided by the Department of State Development and the Department of Science, Information Technology and Innovation.

mailto:[email protected]


Infrastructure, Planning and Natural Resources Committee i

Contents

Abbreviations ii

Chair’s foreword iii

Recommendations iv

1 Introduction 1

1.1 Role of the committee 1

1.2 Inquiry process 1

1.3 Policy objectives of the Gasfields Commission and Other Legislation Amendment Bill 2017 1

1.4 Consultation on the Bill 2

1.4.1 Amendments to the Biodiscovery Act 2004 2

1.4.2 Amendments to the Gasfields Commission Act 2013 2

1.4.3 Amendments to the Sustainable Ports Development Act 2015 3

1.5 Should the Bill be passed? 3

2 Examination of the Gasfields Commission and Other Legislation Amendment Bill 2017 4

2.1 Amendment of Biodiscovery Act 2014 4

2.1.1 Stakeholder comments 5

2.2 Amendments to the Gasfields Commission Act 2013 9

2.2.1 Gasfields Commission review 9

2.2.2 Amendments to the commission’s functions 11

2.2.3 Part-time chairperson 11

2.2.4 Redesignation of role of general manager to chief executive officer 12

2.2.5 Stakeholder comments 12

2.3 Amendments to the Sustainable Ports Development Act 2015 13

3 Compliance with the Legislative Standards Act 1992 15

3.1 Fundamental legislative principles 15

3.1.1 Rights and liberties of individuals 15

3.2 Proposed new or amended offence provisions 16

3.3 Explanatory notes 16

Appendix A – List of submissions 17

Appendix B – List of witnesses at public departmental briefing 18

Appendix C – Proposed new and amended offence provisions 19

3.4 Proposed new and amended offence provisions 19

Statement of Reservation 20


ii Infrastructure, Planning and Natural Resources Committee

Abbreviations

APPEA Australian Petroleum Production & Exploration Association

Bill Gasfields Commission and Other Legislation Amendment Bill 2017

Biodiscovery Act Biodiscovery Act 2004

department Department of State Development

Commission Gasfields Commission Queensland

DSITI Department of Science, Information Technology and Innovation

Gasfields Act Gasfields Commission Act 2013

Ports Act Sustainable Ports Development Act 2015


Infrastructure, Planning and Natural Resources Committee iii

Chair’s foreword

This report presents a summary of the Infrastructure, Planning and Natural Resources Committee’s examination of the Gasfields Commission and Other Legislation Amendment Bill 2017.

The committee’s task was to consider the policy outcomes to be achieved by the legislation, as well as the application of fundamental legislative principles—that is, to consider whether the Bill had sufficient regard to the rights and liberties of individuals, and to the institution of Parliament.

On behalf of the committee, I thank those organisations who lodged written submissions on the Bill. I also thank the committee’s secretariat, and the Department of State Development and the Department of Science, Information Technology and Innovation.

I commend this report to the House.

Jim Pearce MP

Chair


iv Infrastructure, Planning and Natural Resources Committee

Recommendations

Recommendation 1 3

The committee recommends the Gasfields Commission and Other Legislation Amendment Bill 2017 be passed.

Recommendation 2 8

The committee recommends that the Minister in the second reading speech report the findings of the government’s consideration of the recommendations and stakeholder issues raised during the 2016 review, including issues relating to the rights to intellectual property of Indigenous people as identified in the Nagoya protocol.


Infrastructure, Planning and Natural Resources Committee 1

1 Introduction

1.1 Role of the committee

The Infrastructure, Planning and Natural Resources Committee (committee) is a portfolio committee of the Legislative Assembly which commenced on 27 March 2015 under the Parliament of Queensland Act 2001 and the Standing Rules and Orders of the Legislative Assembly.1

The committee’s areas of portfolio responsibility are:

Transport, Infrastructure and Planning

State Development, Natural Resources and Mines, and

Local Government and Aboriginal and Torres Strait Islander Partnerships.

Section 93(1) of the Parliament of Queensland Act 2001 provided that a portfolio committee is responsible for examining each bill and item of subordinate legislation in its portfolio areas to consider:

the policy to be given effect by the legislation

the application of fundamental legislative principles, and

for subordinate legislation – its lawfulness.

The Gasfields Commission and Other Legislation Amendment Bill 2017 (Bill) was introduced into the House and referred to the committee on 10 May 2017. In accordance with the Standing Orders, the Committee of the Legislative Assembly required the committee to report to the Legislative Assembly by 14 July 2017.

1.2 Inquiry process

On 11 May 2017, the committee wrote to the Department of State Development (department) seeking advice on the Bill, and invited stakeholders and subscribers to lodge written submissions.

The committee received written advice from the department and received 5 submissions (see Appendix A). On 14 June 2017, the committee received written advice from the department in response to matters raised in submissions.

The committee held a public briefing with the Department of State Development and the Department of Science, Information Technology and Innovation (DSITI) on 24 May 2017 (see Appendix B).

1.3 Policy objectives of the Gasfields Commission and Other Legislation Amendment Bill 2017

The objectives of the Bill are to:

Amend the Gasfields Commission Act 2013 to provide clearer separation between the strategic and operational functions of the commission. The Bill seeks to modify membership requirements and clarify the responsibilities of the chief executive officer. The Bill implements specific recommendations made by the independent reviewer in relation to the Gasfields Commission Act 2013.

Amend the Biodiscovery Act 2004 to expand the contractual framework available for biodiscovery under the Act to allow other entities to enter into subsequent use agreements with a party to a benefit sharing agreement, allowing the formation of biodiscovery commercial chains.

Amend the Sustainable Ports Development Act 2015 to ensure that port overlay provisions which implement a priority port master plan are applied consistently to development assessed against a local government planning scheme under the Sustainable Planning Act 2009 or a land use plan

1 Parliament of Queensland Act 2001, section 88 and Standing Order 194.


2 Infrastructure, Planning and Natural Resources Committee

under the Transport Infrastructure Act 1994 in priority port master planned areas, providing that development is not regulated by the development scheme for a state development area or a priority development area.2

1.4 Consultation on the Bill

1.4.1 Amendments to the Biodiscovery Act 2004

In relation to consultation on the proposed amendments to the Biodiscovery Act 2004 (Biodiscovery Act), the explanatory notes advise:

Extensive consultation with biodiscovery stakeholders was undertaken during the independent Statutory Review of the Biodiscovery Act in May to July 2016. In preparing the amendments to the Biodiscovery Act, DSITI has consulted with active biodiscovery stakeholders including:

Griffith University

The University of Queensland

James Cook University

Queensland University of Technology

The University of the Sunshine Coast

Dugalunji Aboriginal Corporation

The Australian Institute of Marine Science

Rijk Zwaan

Seqirus

EcoBiotics.3

The department advised that these entities ‘support the proposed approach as the first stage in a broader reform of the Biodiscovery Act to give effect to the recommendations arising from the statutory review of the act which was completed last year.’4

1.4.2 Amendments to the Gasfields Commission Act 2013

As set out in the explanatory notes, community consultation regarding the Gasfields Commission Queensland (commission) was undertaken between March and July 2016. In regards to proposed amendments to the Gasfields Commission Act 2013, the department consulted ‘extensively’ with the commission and briefed the following key stakeholders:

Queensland Resources Council

Australian Petroleum Production and Exploration Association

Lock the Gate Alliance

AgForce Queensland

Queensland Farmers’ Federation

Local Government Association Queensland.5

2 Explanatory notes, pp 1, 2. 3 Explanatory notes, p 5. 4 Public hearing transcript, 24 May 2017, p 2. 5 Explanatory notes, p 4.



The department advised that stakeholders raised ‘no issues or concerns in relation to the amendments to the Gasfields Act.’6

In regards to the review of the commission, the Australian Petroleum Production and Exploration Association (APPEA) stated:

We would also like to acknowledge the positive work of the Review of the Gasfields Commission completed prior to the Bill being brought forward. The review was conducted in a balanced manner, a thorough investigation of options was undertaken, and all stakeholder views were considered.7

1.4.3 Amendments to the Sustainable Ports Development Act 2015

The explanatory notes advise that the department did not undertake any external consultation in relation to the proposed amendments to the Sustainable Ports Development Act 2015 (Ports Act).8 However, the department did liaise with Economic Development Queensland, the Office of the Coordinator-General, the Department of Transport and Main Roads and Queensland Treasury and Trade, all of whom support the amendment.9

1.5 Should the Bill be passed?

Standing Order 132(1) requires the committee to determine whether or not to recommend the Bill be passed.

After examination of the Bill, including the policy objectives which it will achieve and consideration of the information provided by the department and from submitters, the committee recommends that the Bill be passed.

Recommendation 1

The committee recommends the Gasfields Commission and Other Legislation Amendment Bill 2017 be passed.

6 Public hearing transcript, 24 May 2017, p 2. 7 Submission 3, p 1. 8 Explanatory notes, p 5. 9 Public hearing transcript, 24 May 2017, p 2.



2 Examination of the Gasfields Commission and Other Legislation Amendment Bill 2017

This section provides detailed information on the proposed amendments and the committee’s examination of stakeholder comments and issues on the Bill. These are set out in the order appearing in the Bill.

2.1 Amendment of Biodiscovery Act 2014

The proposed amendments to the Biodiscovery Act 2014 are in response to stakeholder feedback from the 2015 Independent Statutory Review of the Act and ongoing consultation through the negotiation of benefit sharing agreements with biodiscovery entities.10 As a result of this consultation process, the Bill proposes to expand the contractual framework for biodiscovery under the Act for the purpose of stimulating further innovation and investment in Queensland.11 The department advised:

The Biodiscovery Act is currently structured so that every entity that uses native biological material along a commercial supply chain is required to have a benefit-sharing agreement with the state. The amendments to the Biodiscovery Act will provide an alternative option whereby a head biodiscovery entity which has a benefit-sharing agreement with the state will be permitted to enter into its own arrangements with subsequent users of the native biological material subject to minimum terms being met. This change ensures that all entities along a commercial supply chain can operate in an official commercial arrangement with reduced regulatory burden under the Biodiscovery Act. This will help encourage job creation and innovation in scientific discovery whilst protecting the state’s interests in native biological material. A range of consequential amendments are required to the Biodiscovery Act to deliver this new user model.12

The department provided further clarification in support of the amendments:

The existing approach under the Biodiscovery Act is considered too onerous to be commercially viable in most instances.13

DSITI provided the following example to compare the current approval process and benefit sharing agreement arrangements with the outcomes that are expected from the proposed amendments to the Act:

At the moment, anybody doing biodiscovery is required to have three approvals. One is a collection authority, which is administered by the Department of Environment and Heritage Protection or National Parks, Sport and Racing, depending on where the material comes from. There are two other requirements that are managed by the Department of Science, IT and Innovation. One is a biodiscovery plan, which is basically a description that says this is what we plan to do, these are the kinds of things that we will develop and these are the kinds of benefits that we see may arise. It is a fairly descriptive document. Then there is a third approval that is called a benefit sharing agreement, which is essentially a contract with the state that requires some kind of benefit to be returned to the state. It may be financial, but it may also be a social or environmental benefit. It has various reporting obligations, so annual reporting on what has been achieved through the biodiscovery and those sorts of things, and the provision of those benefits.

As I mentioned earlier, biodiscovery might be the researcher at the moment, but in time you would hope it leads to somebody manufacturing a drug, for example. At the moment, every single participant in a market chain would be required to have a benefit sharing agreement with

10 Explanatory notes, p 2. 11 Public hearing transcript, 24 May 2017, p 2. 12 Public hearing transcript, 24 May 2017, p 2. 13 Explanatory notes, p 2.



the state: the researcher or the university that the researcher belongs; then if they commercialise that to a small business, that person would have to have an agreement with the state; if they give that to a manufacturer, for example, in some kind of commercial agreement, that manufacturer would have to have an agreement with the state. Under this, the plan is to keep that in place and also provide an additional option that allows for what we call the head biodiscovery entity. That may be the university, but it could also, in time, become any one of those members along the chain, to take on the responsibility of managing those agreements through the chain, essentially on behalf of the state. The head biodiscovery entity would then have a subsequent user agreement with each of the participants along that chain. They would have the responsibility for providing the benefits and reporting back through the state on behalf of their market chain. We are told that this will make it easier for those sorts of commercial deals.14

2.1.1 Stakeholder comments

The committee received two submissions regarding amendments to the Biodiscovery Act from Griffith University and Dugalunji Aboriginal Corporation. The university advised that it welcomed the proposed amendments:

By permitting a biodiscovery entity (e.g. Griffith University) to enter into subsequent use agreements with downstream subsequent users (e.g. a biotech or pharma company), the legislation now facilitates the development of pharmaceuticals, agrochemicals, nutraceuticals or cosmeceuticals, enabling the formation of biodiscovery commercial chains.15

Dugalunji Aboriginal Corporation also expressed its support for the Bill’s proposed amendments to the Biodiscovery Act ‘as there may be circumstances where the option [for a subsequent use agreement] will provide the biodiscovery entity with more flexibility when negotiating with third parties.’16

Griffith University made three recommendations to the Bill. Firstly, while the University acknowledged that the Bill would provide that a benefit sharing agreement must include prescribed minimum terms (clause 7), it recommended that the following set of prescribed minimum terms be included in the Act ‘to ensure that all biodiscovery entities will have similar obligations’:

1. Each subsequent use agreement must incorporate these Prescribed Minimum Terms.

2. Each subsequent user must acknowledge the rights of the State of Queensland in relation to the native biological material and commit to the spirit and application of the Convention on Biological Diversity and the Nagoya Protocol;

3. Each subsequent user must keep and disclose true and accurate accounts and records of Biodiscovery research and commercialisation in relation to the native biological material to enable the Biodiscovery Entity to comply with the Act, including any reporting requirements, and to verify the payment of amounts of money to the State of Queensland;

4. Each subsequent user must destroy or return, at the Biodiscovery Entity's option, any unused native biological material upon termination or expiration of any subsequent use agreement;

5. Upon termination of a subsequent use agreement, all related further subsequent use agreements terminate;

14 Public hearing transcript, 24 May 2017, pp 7-8. 15 Submission 4, p 3. 16 Submission 2.



6. Upon termination of a subsequent use agreement, the subsequent user must cease any biodiscovery research and commercialisation activities in relation to the native biological material;

7. Within the subsequent use agreement, the 'prescribed minimum terms' take precedent over any other terms within the subsequent use agreement to the extent of any inconsistency; and,

8. These prescribed minimum terms survive termination or expiration of any subsequent use agreement.17

In regard to this recommendation to prescribe a set of minimum terms as per those set out by Griffith University, DSITI advised:

DSITI is developing prescribed minimum terms to enable biodiscovery entities to enter into subsequent use agreements with subsequent users.

A subsequent use agreement with a subsequent user must contain the prescribed minimum terms in order for it to use the native biological material which is the subject of the agreement.

The Biodiscovery Act will provide the head of power to make and apply the prescribed minimum terms.

The prescribed minimum terms are not proposed to be included in the Biodiscovery Act itself because they may need to be amended from time to time to accommodate, for example, advances in technology and best management practices.

This will ensure the prescribed minimum terms remain contemporary and are responsive to industry and regulator requirements.

The prescribed minimum terms, and any amendment thereafter, must be approved by the Minister.

DSITI will consult with stakeholders about the content of the prescribed minimum terms should the amendment be approved, and prior to the prescribed minimum terms being recommended to the Minister.18

Secondly, the university advised that it proposes to introduce ‘standarised template Benefit Sharing Agreements and templates for Biodiscovery Plans’ for the purpose of ensuring that all biodiscovery entities have ‘comparable obligations, terms and conditions, when conducting biodiscovery and engaging with industry partners to commercialise biological materials from Queensland.’ The university recommended that the government consults with stakeholders ‘to shape these documents.’19

DSITI advised that it had ‘developed a model benefit sharing agreement to assist with negotiations between the State and biodiscovery entities and provide greater regulatory certainty.’ DSITI advised it is also ‘consulting with stakeholders about the content of the model benefit sharing agreement and intends to develop a standard agreement’ and would ‘welcome’ working with Griffith University and other stakeholders to refine this agreement and the approved forms. DSITI noted that ‘[a]n application for approval of a biodiscovery plan must be in the approved form and provide for inclusion of the details mentioned in section 37 of the Biodiscovery Act.’20

17 Submission 4, p 4. 18 Department of Science, Information Technology and Innovation, Department of State Development

correspondence dated 14 June 2017, p 4. 19 Submission 4, p 5. 20 Department of Science, Information Technology and Innovation, Department of State Development

correspondence dated 14 June 2017, pp 4, 5.



Thirdly, the university recommended that ‘benefit sharing’ be inserted prior to the word ‘agreement’ in the new section 35(2) to ensure consistency with section 35(1). However, DSITI advised that ‘an “agreement” is taken to be a “benefit sharing agreement” for the purposes of Part 5, Division 1 of the Biodiscovery Act, unless otherwise stated (see section 33 of the Biodiscovery Act)’.21

Dugalunji Aboriginal Corporation commented on the explanatory notes and the advice that the subsequent use agreements would reduce red tape for stakeholders:

Whilst these changes to the Act are good they would place the biodiscovery entity in a position where it bears the burden of managing any subsequent use agreements and the administration accompanied with that. There are some downsides with that proposition given the increased administration placed on the biodiscovery entity.22

DSITI recognised Dugalunji Aboriginal Corporation’s concerns regarding a biodiscovery entity having the additional responsibility of managing subsequent use agreements and advised:

The proposed amendments do not replace the existing option of each biodiscovery entity along a commercial chain entering into a benefit sharing agreement with the State.

A biodiscovery entity could also use a combination of the two agreements at any point along the commercial chain.

The current requirement for each biodiscovery entity in a commercial chain to enter into a benefit sharing agreement with the State was identified as a barrier to commercialisation for some biodiscovery entities.

The amendment will remove this barrier for biodiscovery entities who wish to use it.23

The committee notes that Griffith University also stated that permitting a biodiscovery entity to enter into subsequent use agreements would facilitate the development of products of biodiscovery and commercial chains.24

Dugalunji Aboriginal Corporation also commented that the Bill does not address other stakeholder issues raised during the 2016 review:

Further amendments would be required to the legislation to address these issues particularly those that relate to Indigenous Peoples rights to intellectual property as identified in the Nagoya protocol.25

DSITI advised:

The State recognises that amendments to the Biodiscovery Act would be required to address Indigenous knowledge and intellectual property protection issues.

A statutory review of the Biodiscovery Act was undertaken in 2016 and considered the issue of Indigenous knowledge and intellectual property protection.

The State is considering the recommendations of the 2016 Review.

21 Department of Science, Information Technology and Innovation, Department of State Development correspondence dated 14 June 2017, p 5.

22 Submission 2. 23 Department of Science, Information Technology and Innovation, Department of State Development

correspondence dated 14 June 2017, p 5. 24 Submission 4, p 3. 25 Submission 2.



DSITI will consult with stakeholders about the 2016 Review and any future amendments to the Biodiscovery Act.26

Committee Comment

In relation to Griffith University’s recommendation to prescribe the minimum terms within the Act as set out in its submission in order to ensure all biodiscovery entities have similar obligations, the committee is satisfied with DSITI’s response that it is developing a set of prescribed minimum terms and that it will consult with stakeholders during this process. The committee is also satisfied with DSITI’s advice in regard to not including the prescribed minimum terms in the Act itself as the terms may need to be amended occasionally to ‘remain contemporary’ and ‘responsive to industry and regulator requirements’.27 The committee notes the prescribed minimum terms, and any future amendments, must be approved by the Minister. In regard to Griffith University’s concerns that all biodiscovery entities have similar obligations, the committee notes that a subsequent use agreement with a subsequent user must contain the prescribed minimum terms and, therefore, all subsequent users would be subject to the same obligations.

In regard to Griffith University’s recommendation that the government consults with stakeholders on a template for a benefit sharing agreement, the committee is satisfied with DSITI’s advice that it will undertake this consultation.

The committee notes the two issues raised by the Dugalanji Aboriginal Corporation. The first issue relates to concerns about a biodiscovery entity having the additional responsibility of managing subsequent use agreements and the administrative burden that may accompany this. The committee notes that the Corporation supports the Bill and the option for a subsequent use agreement as it may provide more flexibility for a biodiscovery entity when negotiating with third parties.28 The committee also notes DSITI’s advice that the proposed amendments would not replace the existing option of each biodiscovery entity along a commercial chain to enter into a benefit sharing agreement with the State and that a combination of the two agreements at any point along the commercial chain could be used. For these reasons and as the current requirement for each biodiscovery entity in a commercial chain to enter into a benefit sharing agreement with the State was identified as a barrier to commercialisation, the committee is satisfied that the amendment would not create undue administrative burden on biodiscovery entities.

The second issue raised by the Dugalanji Aboriginal Corporation was that the Bill did not address other stakeholder issues raised during the 2016 review. The committee notes DSITI’s advice that the government is currently considering the recommendations of the 2016 review and will consult with stakeholders about the review and any future amendments to the Biodiscovery Act. The committee supports the government consulting with those stakeholders, including the Dugalanji Aboriginal Corporation, specifically affected by issues relating to the rights to intellectual property of Indigenous people.

Recommendation 2

The committee recommends that the Minister in the second reading speech report the findings of the government’s consideration of the recommendations and stakeholder issues raised during the 2016 review, including issues relating to the rights to intellectual property of Indigenous people as identified in the Nagoya protocol.



28 Submission 2.



2.2 Amendments to the Gasfields Commission Act 2013

The Bill proposes to amend the Gasfields Commission Act 2013 for the purpose of improving the operational structure of the commission by clearly distinguishing between the roles of the commission’s board and its staff, and corresponding strategic and operational functions of the commission.29

The amendments are a result of an independent review of the commission undertaken by Professor Robert Scott. The report made 18 recommendations and was delivered to government on 29 July 2016. As part of the review, 82 interviews were conducted with landholders, peak industry groups, government agencies, local governments, community groups and other interested stakeholders. Fifty-eight submissions were received also as part of the review. The proposed amendments in the Bill will implement ‘several of the recommendations from the review and aim to’:

give effect to a new structure that separates the strategic and operations aspects of the commission

allow the chairperson to be part-time

redesignate the role of general manager to chief executive officer.30

Other consequential amendments as a result of these structural changes are also required, such as attendance at board meetings, leave and delegations.31

2.2.1 Gasfields Commission review

As noted above, Professor Scott delivered the ‘Independent Review of the Gasfields Commission Queensland and associated matters’ to government in July 2016. On 1 December 2016, the Minister for State Development and Minister for Natural Resources and Mines released the report and the government response. The government's response detailed a range of measures to be adopted based on the review including:

establishing a Land Access Ombudsman to deal with disputes between landholders and resource companies in relation to conduct and compensation agreements

structural and operational changes to the Gasfields Commission that will enable it to work more effectively

a renewed focus by the commission on extension and communication activities to improve the availability of information on the coal seam gas industry particularly for landholders

developing, in consultation with stakeholders, improved approaches to negotiation and alternative ways to resolve land access disputes.32

The committee notes that the government either supported or supported-in-principle all 18 recommendations of the review except for the following two recommendations:

Recommendation 2:

That the Gasfields Commission Act be amended to reflect the following purpose:

29 Public hearing transcript, 24 May 2017, p 2. 30 Explanatory notes, p 1. 31 Department of State Development, Gasfields Commission Review,

http://statedevelopment.qld.gov.au/industry-development/gasfields-commission-review.html. 32 Department of State Development, Gasfields Commission Review,

http://statedevelopment.qld.gov.au/industry-development/gasfields-commission-review.html.

http://statedevelopment.qld.gov.au/industry-development/gasfields-commission-review.html

http://statedevelopment.qld.gov.au/industry-development/gasfields-commission-review.html



The purpose of the Act is to continue the Gasfields Commission to create and maintain a harmonious and integrated relationship between landholders, regional communities and the onshore gas industry in Queensland.

Recommendation 2a):

That the Gasfields Commission Act be amended to reflect the following functions of the Gasfields Commission:

a) facilitate and maintain a harmonious and balanced relationship between landholders, regional communities and the onshore gas industry in Queensland

The government provided the following response for not supporting recommendation 2 from the report of the independent review:

The National Harmonised Regulatory Framework for Natural Gas from Coal Seams 2013, defines coexistence as:

“Principle that acknowledges and respects the rights of all land users and the potential of all regulated land uses, while ensuring that regulated land is not restricted to a sole use without considering the implications or consequences for other potential land uses, and the broader benefits to all Australians.”

The State and many regional stakeholders have invested significantly in building a broad understanding in the community of the concept of coexistence across the area of operation of the onshore gas industry. Despite the definition of coexistence at a national level, it is accepted that the concept of coexistence is subject to interpretation by different stakeholders. Survey data presented in the review indicates a small minority of stakeholders do not accept coexistence is possible. For the vast majority, it appears that coexistence ranges on a spectrum from “embracing or approving” to “accepting or tolerating”.

Given the broad understanding of the term coexistence in the community and the adoption of the concept at a national level, it is considered that there has not been sufficient justification provided in the report to change the purpose of the Gasfields Commission Act 2013.

The preference of the government in supporting the majority of the recommendations of this review, is to address issues raised by stakeholders whilst building on the purpose of the Commission to manage and improve the sustainable coexistence of landholders, regional communities and the onshore gas industry in Queensland (Gasfields Commission Act 2013

section 3). Recommendations for example that clarify the role of the Gasfields Commission and other agencies, improve communication and strategic stakeholder engagement and more streamlined and accessible processes to manage disputes, are all expected to deliver long-term improvements in the sustainable coexistence with the onshore gas industry.

In response to rejecting recommendation 2a of Professor Scott’s report, the government advised:

This recommendation reflects the change in the purpose of the Commission in Recommendation 2 above, which the government does not support. The report states that the Gasfields Commission has contributed significantly to improving relationships between landholders, regional communities and the onshore gas industry. The current function s.7(a) “facilitating better relationships between landholders, regional communities and the onshore gas industry” supports the principle of co-existence between stakeholders.33

33 Queensland Government, Government Response to the Independent Review of the Gasfields Commission, https://www.statedevelopment.qld.gov.au/resources/report/government-response-to-the-independent-review.pdf.

https://www.statedevelopment.qld.gov.au/resources/report/government-response-to-the-independent-review.pdf

https://www.statedevelopment.qld.gov.au/resources/report/government-response-to-the-independent-review.pdf



2.2.2 Amendments to the commission’s functions

The department advised that while the findings of the review found that the commission had been working effectively, the report recommended that the way the commission operated be amended given the changing nature of the industry as it transitioned from a start-up situation to an established industry:

… the key recommendations Professor Scott made were very much around moving the board from being very active in terms of the commission being very actively involved out in the community to a board which was more traditional in that it was providing strategic oversight for the commission with the officers of the commission expected to take on a lot more of that community consultation role. In that sense, it was really bringing it in line with other statutory organisations across the Queensland government. That was probably the major shift that was recommended by Professor Scott.34

The committee notes that the review’s recommendation to reduce the number of commissioners from six to three has been implemented. On 1 December 2016, the Minister for State Development and Minister for Natural Resources and Mines announced the appointment of a new chairperson and three part-time commissioners.

The Bill’s proposed amendments to section 7 of the Act (commission’s functions) would remove the provision that the commission convene between landholders, regional communities and onshore gas industry for the purposes of resolving issues. The explanatory notes advise this amendment would ‘allow the commission to focus on facilitating better relationships between gas companies and landholders at a strategic level, rather than through involvement in individual disputes.’35 The department clarified:

The intent of the commission—and this was something that Professor Scott was very strong on—was never to resolve individual disputes between a landholder and gas company but rather to provide information that helped all parties grow and understand what the industry was, what the impact was on those local communities and how that impact could be mitigated or managed. That is very much the central focus of the GasFields Commission, and the changes recommended by Professor Scott were very much around trying to make the role of the commission more effective as the industry transitioned from start-up to establishment.36

2.2.3 Part-time chairperson

Clause 20 of the Bill amends the membership of the commission and would provide for either a part-time or full-time chairperson, and up to 6 part-time commissioners. The current Gasfields Act requires that the chairperson be appointed on a full-time basis.37 The department clarified why the amendment is proposed given the changing focus of the commission’s board from operational to strategic:

Obviously with the recommendation that the commission become a more typical, if you like, statutory authority in the sense that the commission staff do a lot more of the work and the board becomes more of a traditional strategic management board, there was a view that there may only be a need for a part-time commissioner. We have given that flexibility within the amendments to the bill.38

34 Public hearing transcript, 24 May 2017, p 2. 35 Explanatory notes, p 9. 36 Public hearing transcript, 24 May 2017, p 3. 37 Explanatory notes, p 10. 38 Public hearing transcript, 24 May 2017, p 4.



2.2.4 Redesignation of role of general manager to chief executive officer

Clause 27 of the Bill proposes to amend the Act to redesignate the role of general manager to chief executive officer as recommended in the report into the review of the commission:

It reflects the changing nature of the role of the board to one that is a strategic, more traditional board away from one that was more active in terms of the day-to-day operations of the commission. In order to continue the good work of the commission, Professor Scott recommended that the role change from general manager to chief executive officer to reflect its greater role or greater impact. That is obviously reflected in the change to the act.39

2.2.5 Stakeholder comments

The committee received three submissions relating to the Bill’s proposed amendments to the Gasfields Act.40 All submissions supported the amendments with Queensland Resources Council advising:

QRC has no issue with the Bill. QRC understands that the role of the Gasfields Commission is changing, and therefore it is appropriate to make some administrative, strategic and operational changes.41

The committee notes that both QRC and APPEA commented highly on the work of the Gasfields Commission.42 APPEA stated:

The Commission is a key part of the Queensland Government's approach of supporting coexistence and its work has resulted in many benefits for communities, government, and the onshore gas industry.43

The GasFields Commission provided the following advice on how it is preparing to implement the changes proposed in the Bill:

The Commission is currently embedding the resources and capabilities necessary to establish an effective stakeholder relations capability so that the Commission is visible and accessible in the gasfields and emerging areas.

This organisational change contained within the Bill enables the Commission to effectively manage the engagement activities that were previously performed by seven Commissioners.

The Commission has commenced the transition process to establish the new operating environment and has published its 2017 - 2021 Strategic Plan, reflecting the strategic role of the Commission board in setting the direction for Commission staff.44

Both QRC and APPEA, however, expressed some concern regarding a potential overlap of functions and jurisdictions between the Gasfields Commission, the proposed Land Access Ombudsman,45 and the CSG Compliance Unit.

QRC stated:

QRC is strongly supportive of the Commission continuing to play a constructive role in the future. However, QRC understands that the role of the Land Access Ombudsman is to resolve individual disputes relating to coexistence. Therefore, there is an overlap between the previous role of the

39 Public hearing transcript, 24 May 2017, p 4. 40 Queensland Resources Council; Australian Petroleum Production & Exploration Association; GasFields

Commission. 41 Submission 1, p 2. 42 Submission 1; Submission 3. 43 Submission 3, p 1. 44 Submission 5, p 1. 45 Refer Land Access Ombudsman Bill 2017 introduced into Queensland Parliament on 23 May 2017.



Gasfields Commission and the new role of the Land Access Ombudsman. The role of the Commission will need to evolve to enable them to develop a view on the systemic or recurring issues which may generate disputes with landholders.46

APPEA called for ‘clear jurisdictional boundaries’ between the agencies to ensure public confidence in government and the industry:

With regard to the broader regulatory framework we are however concerned that there appears to be growing complexity and overlap between the various agencies with roles in land access and onshore gas regulation. In particular, the functions and jurisdiction of the Gasfields Commission, the proposed Land Access Ombudsman, and the CSG Compliance Unit appear to overlap significantly with respect to complaints, regulatory breaches, health and advice to government agencies.

APPEA supports government's role in each of these areas but it is essential that there are clear jurisdictional boundaries between each government agency and the functions of each agency are effectively communicated to the public. A lack of clarity in this regard adds cost to onshore gas production and undermines public confidence in government and the industry as this is in part dependent on a clear, accessible, and responsive regulatory framework.47

In relation to the concerns regarding the broader regulatory framework for land access and the onshore gas industry, the department advised:

While this issue is not directly relevant to the Bill, the Bill clarifies the strategic function of the Commission and makes clear the Commission should not be involved in individual disputes. This is intended to assist with clarifying the roles and responsibilities of the Commission, Coal Seam Gas Compliance unit and the proposed Land Access Ombudsman.48

Committee Comment

The committee is satisfied that the Bill provides clarity on the strategic function of the Commission not to be involved in individual disputes and its role within the onshore gas industry, and ensures the responsibilities of the Commission, Coal Seam Gas Compliance unit and the proposed Land Access Ombudsman do not overlap and add costs for the industry.

2.3 Amendments to the Sustainable Ports Development Act 2015

The Bill proposes to amend the Ports Act ‘to ensure that port overlay provisions are applied consistently to development assessed against a local government planning scheme under the Sustainable Planning Act 2009 or the Planning Act 2016 (Planning Acts), or a land use plan under the Transport Infrastructure Act 2994 (Transport Act) in priority port master planned areas.’49 This amendment is proposed to:

clarify that development within a state development area or priority development area that is not assessed against the development scheme but regulated under the local government planning scheme or land use plan must consider the port overlay.50

The department advised that the amendment was a ‘technical fix to a regulatory issue’; the amendment would ‘fix that turning on and off of regulatory powers in a state development area or a

46 Submission 1, p 2. 47 Submission 3, p 1. 48 Department of State Development, correspondence dated 14 June 2017, p 2. 49 Explanatory notes, p 2. 50 Explanatory notes, p 2.



priority development area under the Economic Development Act.’51 The department provided the following clarification and example to further explain the objective of the amendment:

As we have progressed master planning under the Sustainable Ports Development Act since 2015, what we have discovered is that when we look at some of the operational matters that we may wish to regulate—we are not there yet—through a master plan and then, through the regulatory tool, a draft port overlay or a port overlay, what the act currently does is create a regulatory island, if you like, for local governments and ports. At the moment, if we have a draft master planned area like we do for Gladstone, that master planned area contains within it local government areas, port lands regulated under the Transport Infrastructure Act and state development areas.

At the moment under the act a port overlay cannot regulate development in a state development area. When we go back to have a look at what we actually intended and what was discussed in this committee’s report back in September 2015, development that was regulated by the Coordinator-General or the Minister for Economic Development Queensland was to be basically exempted from a port overlay. How it was to work was that producing a port overlay to regulate requirements under the Sustainable Ports Development Act triggered a requirement then for the Coordinator-General or the Minister for Economic Development Queensland to have a look at their development schemes and decide whether they were going to be consistent with a port overlay requirement.

What that means in real terms is that a development scheme for a Coordinator-General does not actually regulate everything in a state development area; it just regulates some matters. For Gladstone, for instance, the Gladstone State Development Area scheme regulates material change of use and it also regulates only some operational matters associated with vegetation clearing and management. It does not go down to the next level of regulation which is actually controlled either by the port or by the local government in terms of operational type work—if you are doing earthworks or other matters, that type of regulation sits with the local government. At the moment, if we have a port overlay content, for instance, that might want to regulate something to do with earthworks, because it is not currently captured in terms of protecting outstanding universal value matters, we cannot turn that on in a state development area. It is a matter regulated by, say, local government. It is not captured by a regulation under the development scheme, controlled by the Coordinator-General. We cannot turn that provision on.52

Committee Comment

The committee is satisfied that the proposed amendments to the Sustainable Ports Act 2015 will achieve their objective of ensuring that port overlay provisions are applied consistently to development assessed against a local government planning scheme under the Sustainable Planning Act 2009 or the Planning Act 2016 (Planning Acts), or a land use plan under the Transport Infrastructure Act 2994 (Transport Act) in priority port master planned areas.

51 Public hearing transcript, 24 May 2017, p 4. 52 Public hearing transcript, 24 May 2017, p 4.



3 Compliance with the Legislative Standards Act 1992

3.1 Fundamental legislative principles

Section 4 of the Legislative Standards Act 1992 states that ‘fundamental legislative principles’ are the ‘principles relating to legislation that underlie a parliamentary democracy based on the rule of law’. The principles include that legislation has sufficient regard to:

The rights and liberties of individuals, and

The institution of Parliament.

The committee has examined the application of the fundamental legislative principles to the Bill. The committee brings the following to the attention of the House.

3.1.1 Rights and liberties of individuals

Section 4(2)(a) of the Legislative Standards Act 1992 requires that legislation has sufficient regard to the rights and liberties of individuals.

It is considered that clause 27 raises a potential issue of fundamental legislative principles.

Clause 27

Summary of provisions

Clause 27 inserts new section 30 into the Gasfields Commission Act 2013.

New section 30 provides that the Gasfields Commission (the commission) must employ a chief executive officer (CEO). Currently the commission has a general manager with that position being replaced with a CEO by way of section 30. Pursuant to section 30(3) the commission may at any time remove the CEO from office for any reason or none.

Potential FLP issues

Section 4(2)(a) of the Legislative Standards Act 1992 requires that legislation have sufficient regard to the rights and liberties of individuals.

It may be argued that the CEO would hold a reasonable expectation that an explanation would be provided if they were to be removed from their position, or that the removal might need to be on the grounds of some sort of under-performance or malfeasance on their part.

The committee notes, however, that under current section 30(3) the general manager may currently be removed from office ‘for any reason or none, and has therefore been subject to the same condition of employment as that proposed for the new CEO position.

The provision is also consistent with other legislation recently introduced. For example, the Corrective Services (Parole Board) and Other Legislation Amendment Bill 2017, currently before the Legislative Assembly, provides that the Governor in Council may, at any time, end the appointment of a community board member for any reason or none. Further, the Legislative Assembly has passed legislation, such as the Queensland Reconstruction Authority Act 201153 and the Tourism and Events Queensland Act 201254 which also allow for the removal from office of the CEO for any reason or none.

Committee Comment

The committee notes that clause 27 is consistent with the current provision applying to the general manager. The capacity to remove the CEO ‘for any reason or none’ is also consistent with legislation

53 Queensland Reconstruction Authority Act 2011, s21(2). 54 Tourism and Events Queensland Act 2012, s17(2).



previously passed by the Legislative Assembly. The committee notes the provision is not uncommon to employment contracts of chief executives across the public sector.

3.2 Proposed new or amended offence provisions

A table with details of the proposed new offence provision is at Appendix C.

3.3 Explanatory notes

Part 4 of the Legislative Standards Act 1992 relates to explanatory notes. It requires that an explanatory note be circulated when a Bill is introduced into the Legislative Assembly, and sets out the information an explanatory note should contain.

Explanatory notes were tabled with the introduction of the Bill. The committee considers that the notes are fairly detailed and contain the information required by Part 4 and a reasonable level of background information and commentary to facilitate understanding of the Bill’s aims and origins.



Appendix A – List of submissions

Sub # Submitter

001 Queensland Resources Council

002 Dugalunji Aboriginal Corporation

003 Australian Petroleum Production & Exploration Association

004 Griffith University

005 Gasfields Commission Queensland



Appendix B – List of witnesses at public departmental briefing

Department of State Development

Mr Matthew Andrew, Executive Director, Industry Development

Mr Andrew Broadbent, Director, Industry Development

Mr Peter Silvester, Director, Priority Ports

Department of Science, Information Technology and Innovation

Ms Lea Diffey, Executive Director, Science Development



Appendix C – Proposed new and amended offence provisions

3.4 Proposed new and amended offence provisions

A table with details of the proposed new offence provision is set out below.

Clause Offence Proposed maximum penalty

13 Amendment of Biodiscovery Act 2004

Insertion of new s 55A Contravening prescribed minimum terms of a subsequent use agreement

A subsequent user who is a party to a subsequent use agreement must not contravene a prescribed minimum term of the agreement.

100 penalty units



Statement of Reservation

Dr Jacqueline Dewar Research Director Infrastructure, Planning and Natural Resources Committee Parliament House George Street BRISBANE Q 4000

12 July 2017

Dear Dr Dewar

Ann Leahy MP Member for Warrego

The LNP Members of the Infrastructure Planning and Natural Resources Committee wish to make the following Statement of Reservation and raise these concerns regarding the Gasfields Commission and Other Legislation Amendment Bill 2017.

1 Staffing and location 2 Remuneration of the part time members

The Bill's objective, that arose from an independent review by Professor Bob Scott; is to provide improvements to the operational structure of the Gasfields Commission and this is intended to improve its operation and clearly distinguish between the roles of the Commissioners and the staff of the commission. These changes aim to:

• Give effect to a new structure that separates the strategic and operational aspects of the commission

• Allow the chairperson to be part-time

2 Staffing and location

LNP Members of the Committee were disappointed to learn during the Public Hearings that the Gasfields Commission has closed its Toowoomba Office as at the 30th June 2017 and the office will now be located in Brisbane.

Continued page 2

Roma Electorate Office PO Box 945 ROMA Q 4455 P: 07 4570 1100 Toll Free: 1800 814 479 F: 07 4570 1109 St George Electorate Office PO Box 503 ST GEORGE Q 4487 P: 07 4519 0700 Toll Free 1800 625 430 F: 07 4519 0709

E: [email protected]

2

The organisation chart for the Gasfields Commission indicates the Commission employed thirteen (13) staff members (excluding Commissioners) as at 8 June 2017. Only three of the staff are identified as regional engagement officers ie only 23% of the total staffing of the Commission.

The explanatory notes state "new subsections (ia) and (ib) are inserted into section 7 of the Gas fields Act and provide two new functions for facilitating the provision of information and community participation in health and well-being matters relating to onshore gas activities. These functions will be performed in conjunction with health specialists and service providers and are intended to be a coordination and communication role only."

Given the on-shore gas activities are located in regions outside the capital city metropolitan area, the LNP Members question how this information and community participation will be meaningful for communities located in the on-shore gas regions with only 23% of the Commission Staff tasked to regional engagement.

If the State Government wish to make the focus in legislation on coordination and communication of health and wellbeing matters related to the on-shore gas activities, then State Government should stop the window dressing and ensure that the Commission has a staffing balance that is more regionally focused than the present organisation structure.

2 Remuneration of part time members

During the course of the hearing the Committee Members were advised "The remuneration package/or a full-time chair of the commission is-I will just double-check to make sure I have it right; this is the total package-$221, 7 41. That is for a full-time chair. For a part-time chair, the total remuneration is $6,000, plus reasonable out-of-pocket expenses. The part-time remuneration has been set under the remuneration procedures for part-time chairs and members of Queensland government bodies. For part-time commissioners-and that is what the commissioners now are-the remuneration is $4,500, plus reasonable out-of-pocket expenses."

The LNP Committee Members question how a Government will continue to attract a suitably qualified and experienced persons to undertake a part time Chair and Commissioner role's when the total remuneration is respectively $6000 and $4500 plus reasonable out of pocket expenses. As the on-shore gas industry in Queensland is a multi billion dollar industry this seems to be an imbalance in remuneration for part time Chair's and Commissioners given the importance of the on-shore gas industry to generate growth and jobs in Queensland.

Continued page 3



3

The Committee Members learnt the following during the course of the hearing "When the current board chair accepted the role as a full-time commissioner, site was very aware that changes would be made to the act and it would then be up to the minister to determine whether or not the commissioner would be full time or part time going forward from there. That will obviously be a decision that gets made following the amendment to the act."

In the interests of the stability for the community, the LNP Committee Members ask that the Minister to give clarification in his second reading speech, that he doesn't intend to vary the appointments of the current full time Chair whose term is current till 31st May 2018 once the Act commences.

LNP Members appreciate the opportunity to raise these concerns in the Statement of Reservations.

Yours faithfully

Ann Leahy MP Member for Warrego

Tony Perrett MP Member for Gympie



Documents

Gasfields Commission and Other Legislation Amendment Bill 2017