Administrative Review Council

ADMINISTRATIVE REVIEW COUNCIL

TWENTY-SEVENTH ANNUAL REPORT

2002-03

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Contents

Copyright

Letter

1 Overview

Promoting the work of the Council

Changes in Council membership

2 The work and performance of the Council

The Council's work

An assessment of the Council's performance

3 Management and accountability

Enabling legislation

The responsible Minister

The annual report

Functions and powers of the Council

Membership of the Council

The Council's Secretariat

Council expenditure

The Council's meeting dates

Consultancy services

Social justice and equity

Equal employment opportunity

Occupational health and safety

Freedom of information

Advertising and market research

Ecologically sustainable development and environmental performance

Appendix A Section 51 of the Administrative Appeals Tribunal Act

Appendix B Reports and guidelines issued by the Administrative Review Council

Appendix C Letters of advice

Appendix D Status of the Council's recommendations

Appendix E The Council's expenditure, 2002-03

© Commonwealth of Australia 2003

This work is copyright. Apart from any use permitted under the Copyright Act 1968, no part may be reproduced by any process without written permission.

ISSN 0155-025X
ISBN 0 642 21130 2

For information about this report, or more generally about the Council's work, please contact:

The Executive Director
Administrative Review Council
Robert Garran Offices
National Circuit
BARTON ACT 2600

Telephone: 02 6250 5800
Facsimile: 02 6250 5980
Email: arc.can@ag.gov.au
Internet: www.law.gov.au/arc

ADMINISTRATIVE REVIEW COUNCIL

28 October 2003

The Hon. Philip Ruddock MP
Attorney-General
Parliament House
CANBERRA ACT 2600

Dear Attorney-General

In accordance with s. 58 of the Administrative Appeals Tribunal Act 1975, I am pleased to present to you this report on the operation of the Administrative Review Council for the year 2002-03.

Yours sincerely

Wayne Martin signature

Wayne Martin QC
President

The Administrative Review Council, 3 July 2003

Administrative Review Council 3 July 2003

Photograph by Norman Plant

Standing: Professor David Weisbrot, Professor John McMillan, Melanie Sloss SC, Justice Garry Downes AM, Sue Vardon, Robert Cornall, Patricia Ridley

Seated: Professor Robin Creyke, Wayne Martin QC, Christine Charles

Not included: Stephen Gageler SC

1 Overview

The year 2002-03 has been a productive one for the Administrative Review Council, with significant progress on existing projects and work beginning on several new projects. The year has also seen an increase in the level of advice provided by the Council on administrative law aspects of Commonwealth government legislation.

Two of the Council's research projects reached important milestones during the year with the publication and launch of The Scope of Judicial Review discussion paper and the Automated Assistance in Administrative Decision Making issues paper. These papers concern law and practice in diverse areas of the administrative law system and raise important questions about responding to change in these areas. Both papers - and especially the one on judicial review - have attracted high levels of interest and been well received. The Council expects to produce final reports of its work in both areas during 2003-04.

In addition to its work on these two projects, the Council began work on two new projects. The focus of the first project is Commonwealth government agencies' use of coercive investigative powers. The Council's aim is to provide guidance on the use of such powers and encourage greater consistency across government to the extent that that is possible. The second project deals with matters relating to the procedural discretions of review tribunals, including time limits, standing, and the stay of decisions. Here, the aim is to provide guidance to agencies on the circumstances in which modifications to tribunal discretions are appropriate.

The Council has continued to provide advice on the practical application of administrative law values and principles to decision makers, tribunals, government and individuals. The trend of the previous year continued and intensified in 2002-03, with an increase in the number of advices provided and submissions made by the Council on aspects of administrative law and policy.

During the year the Council provided advice on a range of proposals with implications for administrative law and policy. The Council is pleased with its efforts in this regard, particularly where it was able to become involved at an early stage in the process. It has resolved to continue to pursue opportunities for early involvement in the development of administrative law and policy aspects of legislative proposals.

Promoting the work of the Council

During 2002-03 the Council gave particular consideration to ways in which it might best promote its work and its role in the federal administrative law and decision-making system. While recognising that the principal means of achieving this objective is through the quality of its publications, the Council also took steps to improve both access to and awareness of its publications through better publicity techniques. This included presentations by Council members and Secretariat staff at administrative law seminars and conferences, coordinated publicity campaigns at the time of the launch of publications, and submissions to parliamentary committees and other government inquiries concerned with administrative law.

Publication of the Council's Scope of Judicial Review and Automated Assistance in Administrative Decision Making also afforded the Council the opportunity to reconsider its publicity strategies in the light of new technology. Copies of both papers are available on CD-ROM, as well as in the traditional paper format. In future, all major Council publications will be available in both formats. Copies of all important papers will also continue to be published on the Council's website www.law.gov.au/arc.

In November 2002 the Council met with then Attorney-General, the Hon. Daryl Williams AM QC MP, to discuss the Council's proposed work plan. The outcome of the discussion is reflected in the work of the Council detailed in this report.

Changes in Council membership

  Ron McLeod AM retired as Commonwealth Ombudsman in March 2003, and his ex officio position on the Council was filled by his successor as Ombudsman, Professor John McMillan. Mr McLeod was farewelled at the Council's February 2003 meeting, when he was thanked for his contribution to the work of the Council.

In March 2003 the Council was pleased to welcome two new members - Melanie Sloss SC, a member of the Victorian Bar, and Sue Vardon, Chief Executive Officer of Centrelink. In June 2003 the Council welcomed the re-appointment of Robert Cornall for a further three-year term while farewelling another member, Bill Blick PSM, Inspector-General of Intelligence and Security, whose term of appointment expired in that month.

2 The work and performance of the Council

Section 51 of the Administrative Appeals Tribunal Act 1975 sets out the statutory functions of the Administrative Review Council (see Appendix A). The Council is required to review and inquire into the Commonwealth administrative law system and to recommend to the Minister improvements that might be made to the system. This includes assessing the adequacy of procedures used in exercising administrative discretions and reviewing classes of decisions to determine if they should be subject to administrative review. The Council has a particular recommendatory role in relation to Commonwealth merits review tribunals.

The Council's work

The Council carries out its functions under s. 51 of the Administrative Appeals Tribunal Act through a work program that takes in the preparation of reports on longer term research projects dealing with aspects of the administrative law system, through advising government about the application of administrative law principles to particular policy developments, and through educational and training activities.

Reports and consultation papers

The Council has published 45 reports on aspects of the Commonwealth's administrative law and decision-making system during the 27 years of its existence (see Appendix B). In many instances publication of the reports has been preceded by the publication of issues and discussion papers.

In 2002-03 the Council released two important papers - a discussion paper, The Scope of Judicial Review, and an issues paper, Automated Assistance in Administrative Decision Making. Both are substantial publications and have provided valuable opportunities for members of the community to become involved in the Council's work. The Council has also started work on two new projects, one relating to the coercive investigative powers of Commonwealth agencies and the other relating to the procedural discretions of Commonwealth tribunals.

The scope of judicial review

The Scope of Judicial Review explores a number of aspects of judicial review, among them the following:

On the basis of responses to the discussion paper and related consultations, the Council will shortly begin developing a final report of its work on the scope of judicial review.

Automated assistance in administrative decision making

Automated Assistance in Administrative Decision Making deals with the use of computer-based 'expert systems' for primary decision making in Commonwealth government agencies and considers the implications for administrative decision makers of the use of this technology. The paper canvasses arguments that the technology has great potential to increase accuracy and reduce the costs of administering government programs; it also discusses suggestions that the technology can offer new and innovative methods of service provision. A number of matters are raised, among them increased accuracy, reduced costs, the potential 'de-skilling' of decision makers, and the relationship between the administrative law system and decisions made by computer-based systems.

The paper has attracted considerable interest, including from a number of organisations outside the Council's usual stakeholder group. As part of its consultation strategy for the project, the Council is planning to hold several public forums during 2003-04. Input from a wide range of interested parties will be encouraged.

The aim of the Council's final report on this project will be to provide guidance to government on the appropriate use of expert systems in administrative decision making.

Coercive investigative powers of government agencies

The Council has begun work on a project dealing with the coercive investigative powers of government agencies. The project will involve an assessment of the range of such powers conferred by legislation on Commonwealth agencies and will focus on powers exercisable without application to the courts. The primary objective is to determine whether greater consistency in the use of these powers across government is either desirable or achievable. The Council will also consider the accountability mechanisms associated with the exercise of the powers and the protections available to individuals against whom the powers might be exercised.

As a first step, the Council plans to develop a discussion paper outlining the current range of coercive investigative powers conferred on Commonwealth agencies and the considerations associated with establishing a model set of such powers.

Procedural discretions of review tribunals

In its examination of the procedural discretions of Commonwealth review tribunals, the Council's initial focus is on time limits, standing, and stays of decisions. The aim is to identify and categorise varying practices in these three areas with a view to achieving greater legislative consistency. A possible outcome of the project will be recommendations to government on suitable amendments to the procedural discretions provided to tribunals and the circumstances in which such amendments are appropriate.

Other projects

During 2002-03 the Council also resolved to develop a compendium of key principles of administrative law that need to be taken into account in the training of administrative decision makers. Prompted by the outcomes of the HIH Royal Commission, the Council also proposes to carry out a short study of the various mechanisms provided in legislation for reviewing decisions of the Australian Prudential Regulatory Authority. By the end of the reporting year preliminary work on both these projects had begun.

Advice and submissions to government

The Council regularly provides for government departments and agencies advice on a wide range of administrative law and policy questions and responds to public inquiries into matters that affect the Commonwealth administrative law system.

In 2002-03 the Council placed greater emphasis on this role, and particularly on early involvement in the process, because it considers that better policy outcomes are achievable in this way. During the year the Council provided 12 formal letters of advice or submissions to Ministers, agencies and parliamentary inquiries; this compares with seven in 2001-02. Additionally, on a number of occasions the Council provided advice of a less formal nature to several government agencies.

The Council's early involvement in the development of administrative law policy has resulted in increased resources being required for this work, as both Council members and Secretariat staff are more likely to be involved in follow-up negotiations. The Council considers that the benefits that accrue - in terms of improvements in the application of administrative law principles to new and often unique areas of government policy - justify the increased resources required.

Appendix C presents letters of advice issued by the Council in 2002-03. Because of their proximity to the deliberations of government, not all such letters are reproduced. The Council hopes to publish these letters in future annual reports.

Also included in Appendix C is a letter of advice from 2001-02 relating to the review of decisions of the Pharmaceutical Benefits Advisory Committee: because issues relating to this advice were still under consideration, it was not possible to publish the letter in last year's annual report.

Education and training

Publications

From time to time the Council issues guidelines for use by agencies, decision makers, tribunals and legislators; these are listed in Appendix B along with the Council's reports.

The Practical Guidelines for Preparing Statements of Reasons and the associated Commentary were revised and re-issued in November 2002 to take into account changes in the law relating to the content of statements of reasons consequent on the decision of the High Court in Minister for Immigration and Multicultural Affairs v. Yusuf (2001) 180 ALR 1.

After reviewing its role in the light of the existence of other administrative law publications and continuing demand trends, the Council decided to recast its periodic journal, Admin Review, as an essentially annual publication. It plans to publish a 55th edition of the journal in early 2004. This initiative will allow the Council to provide a yearly overview of events, complementing other administrative journals but also reflecting the Council's unique perspective as part of the Commonwealth administrative law system.

In October 2002 the Council published A Report on the Council of Australasian Tribunals, which documents the development of the Council of Australasian Tribunals, or the COAT, through to its establishment at a meeting of Commonwealth, state and territory tribunals in Melbourne on 6 June 2002.

The Council also contributed articles to other publications: a report on the COAT was published in the Australian Administrative Law Journal and an article on the work of the Council was included in the Australian Law Reform Commission's journal, Reform.

The Council's website

Since 1995 complete copies of Council reports and other substantial Council publications have been published on the Council's website <www.law.gov.au/arc>. The website is an important window for the Council, also providing details of Council membership and of letters of advice provided to government and submissions presented to parliamentary committees.

During the year the Council Secretariat continued with work started in 2001-02 to revise and update the website. The website was used to advertise the launch of and seek responses to the Council's discussion paper The Scope of Judicial Review and the issues paper Automated Assistance in Administrative Decision Making.

Participation in administrative law seminars, conferences and other gatherings

During 2002-03 members of the Council and Secretariat made the following presentations at seminars, conferences and other gatherings:

Presentations of this nature are an important means of raising the profile of the Council and its work.

Other initiatives

The Council works to maintain links with others with an interest and involvement in administrative law, both overseas and at the state and territory level.

On 12 December 2002 the Council Secretariat held informative discussions with Mr Brian Thompson, a senior lecturer in administrative law at Liverpool University, who was visiting Australia for a short period.

The Council's role in the establishment of the Council of Australasian Tribunals and the assistance the Council Secretariat subsequently provided to the COAT in establishing its website register of tribunals also fostered the Council's links with the broader administrative law and decision-making community, particularly administrative tribunals. Although it handed continuing maintenance of the registry over to the COAT secretariat in early 2003, the Council retains a close interest in the COAT, particularly through the Council's President, who is an ex officio member of the COAT. The Council also notes the appointment of ex officio Council member Justice Garry Downes AM to the position of President of the COAT on 5 June 2003.

On 7 March 2003 Council and Secretariat members met with the then President of the COAT, Justice Murray Kellam, and the Secretary to the COAT, John Ardlie, who were visiting Canberra in connection with the establishment of a Canberra Chapter of the COAT.

An assessment of the Council's performance

As noted, 2002-03 was a productive year for the Council. Following is an assessment of the Council's performance in the context of its statutory functions under s. 51 of the Administrative Appeals Tribunal Act.

Reports

Government responses to Council reports

During the year there were no formal responses by the Government to Council reports.

The Government did, however, introduce the Legislative Instruments Bill 2003 into Parliament on 26 June 2003. The Bill is largely consistent with the Council's 1992 report Rule Making by Commonwealth Agencies, which recommended, among other changes, the establishment of an authoritative register to improve public access to legislative instruments. There has been some deviation from the original proposal to take into account advances in technology.

In February 2003 the Attorney-General announced the Government's position on reforms to the Commonwealth's merits review tribunals, reforms that were initially proposed by the Council in its 1995 report Better Decisions: review of Commonwealth merits review tribunals.

Although not intending to re-introduce the Administrative Review Tribunal Bill, the Government is proposing amendments to procedures of existing tribunals that are consistent with the aims of the Bill. The Council expects the amendments will implement some of its initial recommendations.

Appendix D provides an update on the implementation by government of recommendations made by the Council in its reports.

The wider impact of Council publications

The impact of Council publications extends much further than the Commonwealth administrative law system. The information and recommendations presented in the Council's reports and other publications are often turned to by other bodies. The following examples are illustrative:

The demand for Council publications

There has been strong demand for the Council's most recent publications, The Scope of Judicial Review and Automated Assistance in Administrative Decision Making. The Scope of Judicial Review discussion paper represents the most recent and comprehensive work on the subject of judicial review and has been much sought after by members of the legal profession, the judiciary and tribunal members. Because of the high demand, the paper has already been reprinted once.

Demand for Automated Assistance in Administrative Decision Making has also been strong; the paper has attracted considerable interest from the information technology industry and some overseas government agencies.

The Council's report on the establishment of the Council of Australasian Tribunals has been reprinted recently, again because of high demand. There has also been a demand for the Council's 2001 publication A Guide to Standards of Conduct for Tribunal Members and the revised Practical Guidelines for Preparing Statements of Reasons and the related Commentary. The Council has noted an increase in the number of requests from state and territory agencies and tribunals for these publications. Feedback on the 'statements of reasons' booklets has been particularly positive.

In addition, there has been renewed interest in two of the Council's earlier reports, with numerous requests for Better Decisions: review of Commonwealth merits review tribunals and Rule Making by Commonwealth Agencies, probably as a result of Commonwealth government legislative action on the recommendations in these reports.

Advice and submissions to government and the Parliament

The continuing upward trend in the number of advices and submissions provided by the Council during 2002-03 is a source of satisfaction for the Council. Increased attention has been given to this area since Emeritus Professor Dennis Pearce noted in his presentation on the occasion of the Council's 25th anniversary celebrations that the number of advices provided by the Council had fallen to only four in 2000-01. In 2001-02 the number of advices increased to seven; in 2002-03 the number reached 12, the advices covering a broad range of administrative law and policy areas.

As noted, during the year the Council placed particular emphasis on early involvement in the development of administrative policy. When it has been involved early in the process, the outcomes, from the perspective of both government and the Council, have been more positive. The experience has strengthened the Council's view that greater involvement in policy development will lead to improved understanding and implementation of best practice in the application of administrative law.

One consequence of early involvement, however, is the increasing likelihood that advice furnished by the Council will not be able to be published in the annual report because of its proximity to the deliberations of government. Six such advices - relating to legislative policy proposals by the Department of the Treasury, the Department of Transport and Regional Services, the Department of Health and Ageing and the Department of Communications, Information Technology and the Arts - are not published in the Council's 2002-03 annual report for this reason.

Education and training activities

The Council has continued its practice of providing copies of its reports and other publications to educational institutions, libraries, academics and students, in Australia and elsewhere, as one way of participating in academic debate involving administrative law.

Distribution of publications is an important aspect of the Council's educational role, both within government and in the broader community. Efforts to increase access to and knowledge of the Council's work received increased attention during 2002-03 with the development of more sophisticated publicity programs for Council's reports and other publications. As a result, major national newspapers published articles reporting on the release of the Scope of Judicial Review discussion paper and the Automated Assistance in Administrative Decision Making issues paper. Articles and alerts about these publications also appeared in a number of professional journals.

The interest generated by these articles suggests that the publicity program is succeeding in raising the profile of the Council and its work. During the year universities in several states used Council publications in their administrative law programs, resulting in an increase in demand for those publications, notably The Scope of Judicial Review. Other Council publications - such as Automated Assistance in Administrative Decision Making and What Decisions should be Subject to Merits Review? - also attracted a high degree of interest at the Australian Institute of Judicial Administration's Tribunals Conference in Sydney on 5 June 2003.

At a meeting of executive members of the COAT, held in conjunction with the June 2003 Tribunals Conference, Justice Kellam thanked the Council for its contribution to the establishment of the COAT and the tribunals register.

The Council's website

In 2002-03 there was a very significant increase in the number of people visiting the Council's website: an estimated 37 900 people visited the site during the year; this compares with a total of 5 381 visits to the site in 2001-02.

3 Management and accountability

Enabling legislation

The Administrative Review Council is established under s. 48 of the Administrative Appeals Tribunal Act 1975.

The responsible Minister

The responsible Minister is the Attorney-General, who may give directions to the Council in relation to the performance of its functions or the exercise of its powers (s. 51A of the Act) and may refer matters to the Council for inquiry and report (s. 51B). The Council reports to the Attorney-General (s. 51C).

The annual report

The Council is required to furnish an annual report to the Attorney-General for presentation to the Parliament as soon as practicable after 30 June each year. The report is required to be tabled within 15 sitting days of its receipt by the Attorney-General (s. 58 of the Act).

Functions and powers of the Council

As noted in Chapter 2, the powers and functions of the Administrative Review Council are set out in s. 51 of the Administrative Appeals Tribunal Act - see Appendix A.

Membership of the Council

Membership of the Council comprises a President, three ex officio members and up to 10 appointed members (s. 49 of the Act).[3]
The President

The President of the Council is appointed by the Governor-General (s. 49 of the Act). On 22 August 2002 Wayne Martin QC was appointed President of the Council for three years.

Ex officio members

At the end of the reporting period the three ex officio Council members were:

Appointed members

Council members are appointed by the Governor-General (s. 49 of the Act). Appointments are for up to three years and members are eligible for reappointment (s. 52). To qualify for appointment to the Council, members must satisfy one or more of the following criteria:

At the end of the reporting period there were seven appointed Council members (shown here with their term of appointment):

The Council's Secretariat

The Council is assisted in its work by a small Secretariat, the members of which are employed in the Attorney-General's Department under the Public Service Act 1999. Information about that Department's management and human resources policies and practices - including certified agreements and Australian workplace agreements, training and development strategies and outcomes, occupational health and safety, and productivity gains - can be found in the Department's annual report.

At 30 June 2003 the following people made up the Council's Secretariat:

Three Secretariat members left during the reporting year:

Council expenditure

The Council is funded from the budget of the Attorney-General's Department, which publishes its audited financial statements in its annual report. The Council's own statement of expenditure for 2002-03 is presented here in Appendix E.

The Council Secretariat was allocated $467 000 during 2002-03; this compares with $626 380 in 2001-02. During the reporting period the Council spent $409 122, of which $317 039 was paid in salaries and allowances and $92 083 in supplier expenses; the corresponding amounts for 2001-02 were $501 442, $390 594 and $110 848.

The Council's meeting dates

Much of the Council's business is conducted at its regular meetings. During 2002-03 Council meetings were held in Canberra on 20 September 2002, 14 November 2002, 14 February 2003 and 11 April 2003.

Additionally, specific Council projects are dealt with at sub-committee level. During the reporting year the following sub-committee meetings were held:

Consultancy services

The Council did not use the services of any consultants during 2002-03.

Social justice and equity

Because the Council is primarily a law reform and advisory body, it does not offer programs to the public. For the same reason, it does not have a Service Charter. Nevertheless, in recent years the Council has released a number of publications that have significant implications for social justice and equity:

Equal employment opportunity

In view of the Council's small Secretariat, many of its personnel and administrative functions are performed by the Attorney-General's Department. Information about the Department's equal employment opportunity program is provided in the Department's annual report.

Occupational health and safety

The Council's Secretariat uses the policy and resources of the Attorney-General's Department in relation to occupational health and safety. Information about the Department's policy is available in its annual report.

Freedom of information

The Council is an agency for the purposes of the Freedom of Information Act 1982. It received no requests for access to documents during the reporting year.

Section 8 of the FOI Act requires that agencies publish specific information. The Council's statutory functions are set out in Appendix A of this annual report; the other information required by s. 8 follows.

Arrangements for outside participation in the work of the Council

The Council's issues papers and discussion papers, which precede some of its project reports, are distributed for comment and are generally available on the Council's website. Final reports are made available to the public after they have been tabled in the Parliament. Those papers and reports are also circulated to people and groups who may have a particular interest in the subject matter, as well as to members of parliament, the Law Council of Australia, and all state and territory bar associations and law societies.

The availability of the Council's issues papers and discussion papers is generally advertised in a national newspaper and on the Council's website.

From time to time the Council is also called on to make submissions to public inquiries.

Categories of documents held by the Council

The Council maintains the following categories of documents:

Access to documents

All project reports, together with issues and discussion papers, guidelines documents, and copies of Admin Review, are available on request from the Council's Secretariat and can be inspected at the Council's office. When large numbers of a particular publication are requested, a small charge is imposed to cover the cost of publication. More recent reports are also available on the Council's website.

Since 1985-86 the Council's letters of advice have been published in its annual reports, which are available on request from the Secretariat and can be inspected at the Council's office. Minutes of Council meetings and documents placed before the meetings are also held at the Council's office.

It is the Council's policy to make available copies of submissions received as part of its consultation processes in all but the following two circumstances:

All other documents are kept on the files of the Council's Secretariat. Access to those documents can be sought under the FOI Act. If it is possible to release such information, it is the Council's policy to do so.
Facilities for access

As noted, documents can be inspected at the Council's office in Canberra. Information about the facilities available to help people gain access to documents can be obtained from the Council's Executive Director. If necessary, special arrangements can be made to overcome difficulties with physical access.

Freedom of information procedures and initial contact points

The Council's Executive Director will help people seeking access to information to identify the documents in question.

The Executive Director is the only officer authorised to refuse access to documents. If a request is to be refused on grounds appearing in ss. 15(2) or 24(1) of the FOI Act - that is, because of insufficient information or an unreasonable diversion of resources - applicants will be notified and offered an opportunity for consultation.

Information officer

Inquiries concerning access to documents or any other information about the Council can be directed to:

The Executive Director
Administrative Review Council
Robert Garran Offices
National Circuit
BARTON ACT 2600

Telephone: 02 6250 5800
Facsimile: 02 6250 5980
Email: arc.can@ag.gov.au

Advertising and market research

The Council did not undertake any advertising or market research activity during 2002-03.

Ecologically sustainable development and environmental performance

As noted, the Council's Secretariat is based in the Attorney-General's Department. Information about the Department's actions and performance in relation to environmental matters is available in its annual report.

Appendix A Section 51 of the Administrative Appeals Tribunal Act

Section 51 of the Administrative Appeals Tribunal Act 1975 describes functions and powers of the Administrative Review Council:

51(1) The functions of the Council are:

(aa) to keep the Commonwealth administrative law system under review, monitor developments in administrative law and recommend to the Minister improvements that might be made to the system; and

(ab) to inquire into the adequacy of the procedures used by authorities of the Commonwealth and other persons who exercise administrative discretions or make administrative decisions, and consult with and advise them about those procedures, for the purpose of ensuring that the discretions are exercised, or the decisions are made, in a just and equitable manner; and

(a) to ascertain, and keep under review, the classes of administrative decisions that are not the subject of review by a court, tribunal or other body;

(b) to make recommendations to the Minister as to whether any of those classes of decisions should be the subject of review by a court, tribunal or other body and, if so, as to the appropriate court, tribunal or other body to make that review;

(c) to inquire into the adequacy of the law and practice relating to the review by the courts of administrative decisions and to make recommendations to the Minister as to any improvements that might be made in that law or practice;

(d) to inquire into:

(i) the qualification required for membership of authorities of the Commonwealth, and the qualifications required by other persons, engaged in the review of administrative decisions; and

(ii) the extent of the jurisdiction to review administrative decisions that is conferred on those authorities and other persons; and

(iii) the adequacy of the procedures used by those authorities and other persons in the exercise of that jurisdiction;

and to consult with and advise those authorities and other persons about the procedures used by them as mentioned in subparagraph (iii) and recommend to the Minister any improvements that might be made in respect of any of the matters referred to in subparagraphs (i), (ii) and (iii); and

(e) to make recommendations to the Minister as to the manner in which tribunals engaged in the review of administrative decisions should be constituted;

(f) to make recommendations to the Minister as to the desirability of administrative decisions that are the subject of review by tribunals other than the Administrative Appeals Tribunal being made the subject of review by the Administrative Appeals Tribunal; and

(g) to facilitate the training of members of authorities of the Commonwealth and other persons in exercising administrative discretions or making administrative decisions; and

(h) to promote knowledge about the Commonwealth administrative law system; and

(i) to consider, and report to the Minister on, matters referred to the Council by the Minister.

(2) The Council may do all things necessary or convenient to be done for or in connection with the performance of its functions.

(3) If the Council holds an inquiry, or gives any advice, referred to in paragraph (1)(ab), the Council must give the Minister a copy of any findings made by the Council in the inquiry or a copy of the advice, as the case may be.

Appendix B Reports and guidelines issued by the Administrative Review Council

Reports

The following reports have been published by the Administrative Review Council since its inception in 1976. For many of them, publication was preceded by the distribution of discussion or issues papers for comment. The year of a report's publication is provided in parentheses after the title.

1

Administrative Decisions (Judicial Review) Act 1977 - exclusions under section 19 (1978)

2

Repatriation Appeals (1979)

3

Review of Import Control and Customs By-Law Decisions (1979)

4

Administrative Appeals Tribunal Act 1975 - amendments (1979)

5

Defence Force Ombudsman (1979)

6

Entry to Cocos (Keeling) Islands and Christmas Island (1979)

7

Citizenship Review and Appeals System (1980)

8

Social Security Appeals (1980)

9

Administrative Decisions (Judicial Review) Amendment Bill 1980 (1980)

10

Shipping Registration Bill (1980)

11

Student Assistance Review Tribunals (1981)

12

Australian Broadcasting Tribunal Procedures (1981)

13

Commonwealth Employees' Compensation Tribunal (1981)

14

Land Use in the ACT (1981)

15

Australian Federal Police Act 1979 - sections 38 & 39 (1982)

16

Review of Decisions under the Broadcasting and Television Act 1942 (1982)

17

Review of Taxation Decisions by Boards of Review (1983)

18

Compensation (Commonwealth Government Employees) Act 1971 - Amendments (1983)

19

Rights of Review under the Migration Act 1958 and Related Legislation: interim report on the constitution of the Administrative Appeals Tribunal (1983)

20

Review of Pension Decisions under Repatriation Legislation (1983)

21

The Structure and Form of Social Security Appeals (1984)

22

The Relationship between the Ombudsman and the Administrative Appeals Tribunal (1985)

23

Review of Customs and Excise Decisions: stage two (1985)

24

Review of Customs and Excise Decisions: stage four - censorship (1985)

25

Review of Migration Decisions (1985)

26

Review of the Administrative Decisions (Judicial Review) Act - stage one (1986)

27

Access to Administrative Review: stage one - notification of decisions and rights of review (1986)

28

Review of Customs and Excise Decisions: stage three - anti-dumping and countervailing duty decisions (1987)

29

Constitution of the Administrative Appeals Tribunal (1987)

30

Access to Administrative Review: provision of legal and financial assistance in administrative law matters (1988)

31

Review of Decisions under Industry Research and Development Legislation (1988)

32

Review of the Administrative Decisions (Judicial Review) Act - the ambit of the Act (1989)

33

Review of the Administrative Decisions (Judicial Review) Act: statements of reasons for decisions (1991)

34

Access to Administrative Review by Members of Australia's Ethnic Communities (1991)

35

Rule Making by Commonwealth Agencies (1992)

36

Environmental Decisions and the Administrative Appeals Tribunal (1994)

37

Administrative Review and Funding Decisions - a case study of community services programs (1994)

38

Government Business Enterprises and Commonwealth Administrative Law (1995)

39

Better Decisions: review of Commonwealth merits review tribunals (1995)

40

Open Government: a review of the federal Freedom of Information Act 1982 (1995)

41

Appeals from the Administrative Appeals Tribunal to the Federal Court (1997)

42

The Contracting out of Government Services (1998)

43

Administrative Review of Patents Decisions (1999)

44

Internal Review of Agency Decision Making (2000)

45

A Report on the Council of Australasian Tribunals (2002)

Guidelines

From time to time the Council has also published guidelines for use by agencies, decision makers, tribunals and legislators, as follows:

Appendix C Letters of advice

The Council has published its letters of advice in its annual reports since 1985-86. Although its reports are tabled in the Parliament and published for the benefit of the public, inclusion of the letters of advice in the Council's annual reports helps these letters reach the broader community. Both the Council's reports and its letters of advice are also published on the Council's website.

The letters of advice issued by the Council in 2002-03 and a letter held over from 2001-02 are reproduced in this appendix. A brief explanation of the background to each letter, together with a short summary of the contents, is included as a preface. Table C.1 lists the letters.

Table C.1 Letters of advice reproduced in this report

Letter number

Subject matter

1

Inspector-General of Taxation - consultation
2

Law Reform Commission discussion paper, Judicial Review of Administrative Decisions: options for reform
3

Prohibited Words and Letters Regulations - application of administrative review principles
4

Inquiry into the Inspector-General of Taxation Bill 2002
5 Proposal to establish a Postal Industry Ombudsman
6

Review of recommendations of the Pharmaceutical Benefits Advisory Committee (1)
7

Review of recommendations of the Pharmaceutical Benefits Advisory Committee (2)

Six letters of advice are not presented in this appendix in view of their proximity to the deliberations of government. The Council hopes to publish these letters in its annual report for 2003-04.

Letter 1 Inspector General of Taxation - consultation

In response to the Government's consultation paper on the proposed Inspector-General of Taxation, the Council was generally supportive of the proposed role of the Inspector-General to investigate systemic tax administration matters, but it was concerned to ensure that the existing powers of the Commonwealth Ombudsman be preserved in this area.

2 July 2002

Mr Richard FE Warburton
Chairman
Board of Taxation
The Treasury
Langton Crescent
PARKES ACT 2600

Dear Mr Warburton

INSPECTOR-GENERAL OF TAXATION - CONSULTATION

Thank you for your letter of 29 May 2002 inviting the Administrative Review Council to participate in the Board of Taxation's consultations on the Government's Consultation Paper, The Inspector-General of Taxation in the Taxation System. In response to your invitation, the Council offers the following comments on the Consultation Paper.

To the extent that it may supplement existing governance and accountability arrangements in the tax administration area, the Council is supportive of the proposed establishment of the office of Inspector-General of Taxation. However, as recognised in the Consultation Paper, there is the potential for considerable overlap with the role of the Commonwealth Ombudsman.

In the Consultation Paper it is proposed that the major role of the Inspector-General would be as an adviser to the Government on the operation of the tax administration system, and that the Ombudsman would continue to deal with individual taxpayer concerns about particular cases (page 11 of the Consultation Paper). However, as noted in the Consultation Paper, under the Ombudsman Act 1976, the Ombudsman also has broad 'own motion' powers enabling the investigation of any administrative matter of a Commonwealth Department or prescribed authority, including matters relating to the administration of tax at both individual and systemic levels.

The Council agrees with the suggestion made in the Consultation Paper (page 11) that practical working arrangements would need to be developed between the offices of the Inspector-General and the Ombudsman respectively in relation to systemic tax administration issues and to avoid duplication in the matters under investigation by either office. The Council suggests that this should be possible by agreement between the two offices rather than through formal procedures which could result in cumbersome and inefficient administration.

In saying this, however, the Council would not wish to be considered to be lending its support to a derogation of the Ombudsman's current 'own motion' role with respect to systemic tax administration issues. While it is recognised in the Consultation Paper that 'clear lines of accountability and reporting need to be established between the Inspector-General and the Government' (page 22), as noted above, the major role of the office would be as an adviser to Government. In contrast, the Council considers the role of the Ombudsman to be broader, encompassing also the oversight and scrutiny of government administration and decision-making, including administration and decision-making in the tax administration area.

In addition, the manner in which the Ombudsman is established emphasises the independence of the office from the Executive Government in the conduct of external reviews of agency decisions and actions. This independence is crucial to the functioning of the office of Ombudsman and to perceptions of that office. The Council would be opposed to any steps which interfered with the standing and role of the Ombudsman in this respect.

Reflecting this distinction, although it is proposed that the Inspector-General would report annually to the Parliament, appear before Parliamentary Committees and table information (page 22), the office would seem primarily to operate by way of report and recommendation to the Minister (page 8). In contrast, in addition to these parliamentary reporting and appearance obligations, the Ombudsman has the capacity pursuant to section 17 of the Ombudsman Act, to report directly to Parliament in circumstances where action requested of a Department or prescribed agency is not taken.

In summary, therefore, the Council is of the view that although it would appear from the Consultation Paper that the role of the Inspector-General in relation to systemic tax administration issues is to be the predominant one, it is important that the existing legislative powers of the Ombudsman should be preserved.

Finally, having regard to the proposed primary focus of the Inspector-General upon identifying and advising upon systemic tax administration issues, the Council is concerned that the information gathering powers proposed for the office (page 22) are wider than necessary for that purpose and should not encompass gaining confidential information concerning individual taxpayers without their consent. That is, it should be possible, in our view, for aggregate data relating to complainants to be made available to the Inspector-General without the need to identify personal details.

The Council trusts that these comments are of assistance. Should you have any queries, please do not hesitate to contact Margaret Harrison-Smith of the Council Secretariat in the first instance on telephone number 6250 5829 or by email at margaret.harrison-smith@ag.gov.au.

Yours sincerely

Wayne Martin signature

Wayne Martin QC

Letter 2 Law Reform Commission discussion paper, Judicial Review of Administrative Decisions: options for reform

In this letter of advice to the Law Reform Commission of Western Australia the Council expresses its strong support of the Commission's view that judicial review procedures in Western Australia are in need of reform. The letter goes on to comment on the particular aspects of the Commission's recommendation for state legislation similar to the Commonwealth Administrative Decisions (Judicial Review) Act.

2 September 2002

Ms Heather Kay
Executive Officer
Law Reform Commission of Western Australia
Level 3, The BGC Centre
28 The Esplanade
Perth WA 6000

Dear Ms Kay

Law Reform Commission discussion paper, Judicial Review of Administrative Decisions: options for reform

The Administrative Review Council (the Council) welcomes the invitation to comment on the Law Reform Commission of Western Australia's Discussion Paper, Judicial Review of Administrative Decisions: options for reform. The Council's comments on the Discussion Paper are set out below.

Need for reform

In view of the fact that, in Western Australia, there is presently no alternative to the prerogative and equitable remedies for the judicial review of administrative actions, the Council strongly agrees with the Commission's finding that 'there is a definite need for reform in this area of the law' in Western Australia (Executive Summary, page i).

In 1973, in advocating reform of the then prevailing Commonwealth system of judicial review, the Ellicott Committee urged the government of the day to accept the view of the Kerr Committee[5] 'that the state of law relating to judicial review of administrative action is technical and complex and in need of reform, simplification and legislative statement'.[6] In the Council's view, these sentiments remain equally pertinent today to any jurisdiction in which there is sole reliance on prerogative and equitable remedies in the review of administrative action.

As reflected in Chapter 3 of the Discussion Paper, in light of these technicalities and complexities, substantive and procedural reform of judicial review processes has been undertaken in many Australian and overseas common law jurisdictions.

Substantive and procedural reform

The Council agrees with the views expressed in the Discussion Paper (pages 6-9) with respect to the substantive and procedural illogicalities existing between these two forms of remedy.

Following the passage of the Administrative Decisions (Judicial Review) Act 2000 (Tas), Western Australia is the only state or territory, apart from the Northern Territory, still reliant in its administrative law jurisdiction on the prerogative writs. The Council therefore agrees with the Commission's proposal (page 27) to reform the procedures associated with the existing remedies.

The Council also agrees with the three arguments for substantive reform outlined by the Commission (pages 24-25), noting that such reform has been undertaken in four Australian jurisdictions to date.[7]

Possible abolition of existing remedies

On balance, the Council considers that it is probably desirable at this stage for Western Australia not to abolish existing prerogative and equitable remedies. Certainly, for practical reasons, the Council considers that the preferred approach would be to codify the grounds of review prior to abolishing these remedies in Western Australia.

Notwithstanding this, however, the Council considers that the Commission could usefully investigate the reasoning underlying the abolition by the Judicial Review Act 2000 (Tas)[8] of the prerogative remedies in that state.

The suggestion made by the Commission (page 26) that any statutory remedy developed should be in addition to, not in derogation of, any common law developments is, in the Council's view, a sensible one, and one which would prevent the creation of jurisdictional 'gaps' developing between the statutory and non-statutory regimes.

Adoption of ADJR Act (Cth)

As noted in the Discussion Paper (page 27), there would be distinct advantages in following the precedent provided by the ADJR Act (Cth) given the considerable jurisprudence that has grown up over the last twenty-two years.

Moreover, the Judicial Review Act 1991 (Qld), the Administrative Decisions (Judicial Review) Act 1989 (ACT) and the Judicial Review Act 2000 (Tas) substantially follow the Commonwealth Act. As noted by the Attorney-General of Tasmania, the Hon. Dr Peter Patmore, in relation to his state's election in that regard:

This will mean that the extensive body of case law which has been developed since 1977 in relation to the interpretation of the Commonwealth Act will be available to administrative decision makers in this State in relation to the Tasmanian Act.[9]

Notwithstanding its support for the adoption of an approach reflective of that adopted under the ADJR Act (Cth), the Council agrees, however, with the Commission's tentative view (pages 27, 28) that that Act should not be followed slavishly.

Ambit of the statutory remedy

Proposed variations, similar to those implemented under the Queensland and Tasmanian Judicial Review Acts, to extend the ambit of those Acts to the review of decisions of the Governor, are supported by the Council. As noted by the Commission, in its Report 32, Review of the Administrative Decisions (Judicial Review) Act: the ambit of the Act, the Council made a similar recommendation in relation to the application of the ADJR Act (Cth) to the Governor-General.[10]

As observed in the Discussion Paper, such provision would ensure consistency of the proposed legislation with the position at common law, having regard to the subsequent impact of the decision of the High Court in FAI Insurances Ltd v. Winneke.[11]

Decisions under an enactment

The Commission also notes the recommendation made by the ARC in its 32nd report[12] to remove the current restriction of the application of the ADJR Act to 'decisions under an enactment'. That exclusion has prevented direct review of the validity of subordinate laws and has inhibited review in relation to executive action, forcing reliance on common law remedies. It has also inhibited the review of activities properly regarded as exercises of public power.[13]

Although these gaps have now been filled by the passage of section 39B(1A) of the Judiciary Act 1903, extending common law review to 'laws of the Commonwealth', the Council considers that it would be sensible, from the outset, to seek to avoid these sorts of jurisdictional difficulties in Western Australia. A formula such as 'under or pursuant to the laws of Western Australia', which the Council notes that the Commission has employed in possible recommendation 5, might appropriately avoid any such traps. It would also permit the possible extension of review to activities of bodies such as that the subject of decision in the Datafin case,[14]on the basis that they are exercising public power, are not consensual, and affect the public at large, assuming such a development, in time, is considered desirable.

Government business enterprises

The Council supports the Commission's tentative recommendation (page 28) that the application of the proposed Western Australian legislation be extended to 'to decisions of an officer or employee of the State or a local government authority involving public funds'.

The Council notes that in its 32nd report, Review of the Administrative Decisions (Judicial Review) Act: the ambit of the Act, it recommended that the application of the ADJR Act (Cth) be extended to decisions of an administrative character not made under legislation but relating to the use of funds authorised or appropriated by the Parliament.[15]

In the case of government business enterprises, however, the Council supports the Commission's tentative recommendation (page 29) that the preferable approach would be 'to consider particular enterprises for exclusion from the operation of the Act ... on a case by case basis'.

Decision of the High Court in Australian Broadcasting Tribunal v. Bond[16]

The Council also supports the Commission's tentative recommendation (page 29) that there should be no statutory modification of the decision of the High Court in Bond's case. The only qualification that should be made to this is that attention should be given to the dissenting judgment of Toohey and Gaudron JJ in Bond, in which it was pointed out that the distinction between 'decision' and 'conduct', based on sections 5 and 6 of the ADJR Act, did not divide neatly between substance and process, as Mason J (for the majority) had indicated. The Council suggests, therefore, that the Commission might wish to consider this area with a view to ensuring that the distinction between 'conduct' and 'decision' is more clearly defined in the proposed Western Australian legislation.

Grounds

In the Discussion Paper it is suggested (possible recommendation 6) that the grounds of review should be specified in the proposed Act and should follow, as closely as possible, the terms used in the ADJR Act, with the possible addition of a ground intended to embrace any developments in the non-statutory grounds of review.

The Council notes that there is considerable overlap between the grounds of review under the ADJR Act: the grounds of error of law and no evidence are illustrative. However, at this stage, the Council considers that it would probably not be practicable to undertake the detailed form of inquiry that such an analysis would require. Any refinements to the grounds of review found to be necessary having regard to the initial operation of the legislation could be made at a later stage. The Council would suggest, however, that the Commission might usefully consult with Tasmania on the issue, having regard to the fact that it has made a number of modifications to the grounds of review under its Judicial Review Act.

The suggestion that in the proposed Western Australian legislation there be a departure from the approach adopted in paragraph 5(1)(j) of the ADJR Act (Cth) (page 28) is supported by the Council having regard to the proposed inclusion of a ground designed to embrace any development in the non-statutory grounds of review. In the 25 years' operation of the ADJR Act, paragraph 5(1)(j) has been little used.

Privative clauses

The Council strongly endorses the proposed abolition of existing privative clauses under Western Australian legislation. It is the Council's view that in the event that a Government wants to limit or to exclude judicial review of administrative decisions, it should do so expressly in the legislation rather than seek to do so circuitously by way of a privative clause. This is the approach to be recommended in the Council's forthcoming discussion paper on the scope of judicial review.

Limitation period

In the Discussion Paper (page 31), the Commission recommends that the 28-day limitation period specified under the Commonwealth and Queensland judicial review legislation for the commencement of judicial review proceedings is too short, recommending that proceedings should be commenced as soon as possible and 'in any event within six months of notification of the decision under review'. It is also suggested that there should be an option for the Court to extend this period or to dismiss proceedings even if brought within the six-month period.

The Council agrees that the 28-day period for the commencement of applications is too restrictive and, as in the case of applications for the review of decisions under the Migration Act 1958 (Cth), can encourage the lodging of 'holding' applications, which may subsequently be withdrawn.

Rather than a six-month limitation period however, the Council suggests that the appropriate balance sought by the Commission could be attained through the prescription of a 60-day period as recommended in the review of possible further reforms to Victoria's judicial review regime[17], especially in view of the discretion proposed for the Court to extend the period in appropriate cases.

Standing

The Council agrees with the view of the Commission (page 32 and possible recommendation 9) that there should be a small departure from the language of the ADJR Act (Cth) to enable leave to be granted to a party to proceed 'notwithstanding his or her interests are not affected by the decision under review, if it is satisfied that it is in the public interest to do so'. The Council considers that it is inequitable to have one rule for representative groups and another for individuals, as in some jurisdictions. However, the Council would not advocate open standing. Although this appears to have provided a workable option in the NSW Land and Environment Court, for example, it does provide a potential avenue for abuse and could impose strains upon the resources of the Court.

Justiciability

In the Council's 32nd report, Review of the Administrative Decisions (Judicial Review) Act: the ambit of the Act, the Council recommended amending the ADJR Act to exclude from its operation decisions or conduct that is not justiciable.[18] The Council notes that the Commission does not favour implementing this recommendation. As an alternative, the Council suggests that the recommendation made by the Commission regarding the discretionary refusal of relief, which the Council considers a good suggestion, could be strengthened to require the Court to consider each case in the early process to ensure that it is appropriate for review. In effect, the Court would be required to address the issue of justiciability during the preliminary process.

Reasons

The Council agrees with the Commission's tentative recommendations with regard to statements of reasons (page 36 and possible recommendation 19).

As stated by the Council in its 33rd Report, Review of the Administrative Decisions (Judicial Review) Act: statement of reasons for decisions:

There is no doubt that an awareness by decision makers that they may have to justify their prospective decisions through the provision of a statement of reasons contributes [significantly] to a better standard of decision-making.[19]

Consistent with the approach advocated in that report, the Council recommends that the requirement for reasons be couched as widely as possible.

The Council supports the proposed time limit of 28 days for the making of applications for statements of reasons.

The Council hopes that its comments will be of assistance to the Commission. Should you wish to discuss any of the comments further, the Council would be happy to assist. The contact officer in the first instance is Margaret Harrison-Smith of the Council Secretariat, who may be reached by telephone (02 6250 5829) or by email (margaret.harrison-smith@ag.gov.au).

Yours sincerely

Robyn Creyke signature

Robin Creyke
on behalf of the Council

Letter 3 Prohibited Words and Letters Regulations - application of administrative review principles

The Department of Defence sought advice from the Council on the appropriateness of external review for decisions made under the Defence (Prohibited Words & Letters) Regulations 1957, which provide that the Minister may prohibit the use of a word or group of words without the Minister's consent. The power is designed to prevent an individual or company inferring a relationship with the Defence Force by the use of these words when such a relationship does not exist. The Council advised that all administrative decisions should be reviewable unless they fell within a valid exception and that in its opinion these decisions did not qualify for any of the exceptions, as set out in the Council's publication What Decisions should be Subject to Merits Review?

28 October 2002

Mr Ian Clarke
General Counsel
Defence Legal Service
R8-2-001
Department of Defence
Canberra ACT 2600

Dear Mr Clarke

Prohibited Words and Letters Regulations -
application of administrative review principles

Thank you for your letter of 15 October 2002 seeking the advice of the Administrative Review Council (the 'Council') on the desirability of merits review for decisions made under sub-regulation 4(1) of the Defence (Prohibited Words and Letters) Regulations 1957 (the 'Regulations'). The Council confirms that it has not previously provided advice to your office on this issue.

Background

Legislation

Section 124(1)(nc) of the Defence Act 1903 provides, amongst other things, for the making of Regulations prohibiting the use, except as prescribed, of a word, words or a group of letters descriptive or indicative of part of the Naval, Military or Air Forces or of a service body or persons associated with the defence of the Commonwealth.

Pursuant to this section, the Regulations provide that certain words and groups of letters cannot be used in connection with a trade, business, calling or profession or by an organisation or body of persons without the consent of the Minister. The prohibited words and letters are identified in the Schedule to the Regulations: Part 1 for the Navy, Part 2 for the Army and Part 3 for the Air Force.

Regulation 4 provides that:

(1) The Minister may, in his discretion, grant his consent to the use of the word, words or group of letters or may refuse the application.

(2) The consent of the Minister may be granted with or without conditions.

There is no provision in the legislation for the review of a decision made by the Minister under sub-regulation 4(1). Although you refer in your letter (paragraph 14) to an informal review process, the Council understands this process to be essentially ad hoc in character and not encapsulated in written guidelines or directions.

Considerations relevant to the making of a decision

The Regulations provide little guidance as to the sorts of issues that should be taken into account by the Minister in determining whether or not to consent to the use of a prohibited word, words or group of words.

However, according to the Explanatory Statement to the Defence (Prohibited Words and Letters) Regulations 2000 (No. 1) ('the Amendment Regulations'), the purpose of the Regulations 'is to prevent the unauthorised use of certain words or letters by businesses so as to imply the appearance of a legitimate association with the Australian Defence Force when this is not the case'.

In adding the words 'Australian Army' to Part 2 of the Schedule to the Regulations, the intention of the Amending Regulations is said in the Explanatory Statement to be to enable a greater degree of control over the use of the term 'in circumstances where the person or business using the words may bring the Army or the Australian Defence Force into disrepute or imply an incorrect association with the Defence Force'. These considerations are reflected in the information provided in your letter.

There is no indication, either in the Explanatory Statement or in your letter, that high level policy issues such as those relating to national security or Australia's relations with other countries, are likely to arise in the context of the making of a decision under sub-regulation 4(1).

Council consideration

General considerations

As reflected in the Council's 1999 guideline publication What Decisions should be Subject to Merits Review? the Council has consistently maintained that an administrative decision made in the exercise of a power conferred by an enactment is prima facie suitable for merits review if the interests of a person will, or are likely to, be affected by an exercise of the power. The Council's approach reflects the requirements for standing to appear before the Administrative Appeals Tribunal. Section 27 of the Administrative Appeals Tribunal Act 1975 provides that persons whose interests are affected by a decision may apply to the AAT for review of the decision.

The Council considers that a decision of the Minister to grant or to refuse consent either with or without conditions under sub-regulation 4(1) could affect the interests of a trade, business calling, profession, organisation or body of persons. For example, an entity precluded from using a prohibited word could suffer financial or other consequences as a result of the Minister's decision. In the absence of any other considerations therefore, the Council is of the view that a decision of the Minister under sub-regulation 4(1) should be subject to merits review.

Additional considerations

You advise in your letter (paragraph 13) that the Department of Defence (the 'Department') is uniquely placed to determine whether words or phrases should be prohibited under sub-regulation 4(1). In the Council's view, this argument presents an unconvincing basis for the exclusion of merits review and could, conceivably, be used by any government agency in an attempt to avoid external merits review of its decisions.

The argument might perhaps be sustainable if it were being asserted that decisions under sub-regulation 4(1) commonly gave rise to sensitive issues of national security. In such circumstances, there might be a case for excluding merits review on a case-by-case basis by way of Ministerial certificate or through application to the Tribunal for review on a secure basis. However, as noted earlier, the focus of consideration in making a decision under sub-regulation 4(1) apparently revolves around issues of reputation and association. In the Council's view, such considerations do not justify the exclusion or modification of external merits review processes.

You also advise (paragraph 14 of your letter) that there are appropriate informal review mechanisms in place within the Department in relation to decisions under sub-regulation 4(1). As noted above, however, these mechanisms are seemingly ad hoc and undefined, and the extent to which applicants under sub-regulation 4(1) would be aware of them is unclear. As a review option, the Council considers such mechanisms represent a poor substitute for external merits review.

Finally, while recognising that comparative legislative analysis can be of limited value, the Council notes, for example, that decisions of the Minister under section 147(2)(b) of the Corporations Act 2001 declining consent to the use of a company name otherwise deemed unacceptable for registration under the Corporations Regulations are reviewable by the Administrative Appeals Tribunal. Insofar as it has the potential to apply to a wider range of users and usages, and can extend to a word or words within a title, there would appear to be compelling grounds for providing for the review of decisions under sub-regulation 4(1) of the Regulations.

Conclusion

Although the exceptions to the prima facie test for merits review set out in What Decisions should be Subject to Merits Review? are not intended to be exhaustive, having regard to the foregoing considerations, the Council considers that there is no basis for excluding from external merits review decisions by the Minister under sub-regulation 4(1). Having regard to the possible exceptions to merits review outlined in What Decisions should be Subject to Merits Review? it is noted, particularly, that there is no suggestion that matters of national interest or foreign relations are likely to be in issue.

The Council recommends, therefore, that decisions concerning the use of the prohibited words or groups of letters set out in the Schedule to the Regulations in connection with a trade, business calling or profession or by an organisation or body of persons made under sub-regulation 4(1) should be subject to merits review by the Administrative Appeals Tribunal.

Should you wish to discuss any of the above, the contact officer in the first instance is Margaret Harrison-Smith of the Administrative Review Council Secretariat, who may be contacted on telephone no. 6250 5800 or by email at margaret.harrison-smith@ag.gov.au.

Yours sincerely

Wayne Martin signature

Wayne Martin QC
President

Letter 4 Inquiry into the Inspector-General of Taxation Bill 2002

The Council responded to an invitation by the Senate Economics Committee to comment on the Inspector-General of Taxation Bill. The Council did not have any concerns with the Bill since the investigative powers of the Inspector-General were circumscribed by his or her role in investigating systemic problems in the taxation system. The Council also considered that individual taxpayers' information was adequately protected by provisions contained in the Bill.

18 November 2002

Dr Kathleen Dermody
Committee Secretary
Senate Economics Committee
Suite SG.64
Parliament House
Canberra ACT 2600

Dear Dr Dermody,

Inquiry into the Inspector-General of Taxation Bill 2002

Thank you for inviting the Administrative Review Council to make a submission to the Senate Economics Committee in relation to the Inspector-General of Taxation Bill 2002 (the 'Bill'). The Council notes that the Bill was introduced into the House of Representatives on 19 September 2002.

The Council has previously provided comments on the proposed establishment of an office of Inspector-General of Taxation in response to the Government's Consultation Paper, The Inspector-General of Taxation in the Taxation System. On 2 July 2002, the Council commented on the proposal in a letter to the Board of the Taxation. In summary, in this letter ... the Council expressed the view that:

In relation to the first of these issues, the Council is of the view that the Bill does not modify the existing legislative powers of the Commonwealth Ombudsman. The function of the Inspector-General is to review systems established by the Australian Taxation Office (ATO) to administer tax laws and report on those reviews (clauses 7(1)(a) and (b) of the Bill). The focus of such reviews will be on tax systems rather than individual taxpayer matters or the handling of particular cases.

While under the Ombudsman Act 1976 the Commonwealth Ombudsman has the power to deal with systemic issues as well as individual taxation complaints, clause 9(2) of the Bill requires the Inspector-General to consult with the Ombudsman (and the Auditor-General) at least once per year to assist the Inspector-General in setting his or her work program. The Council understands that practical arrangements are to be developed between the Ombudsman and the office of the Inspector-General of Taxation in order to avoid duplication in the matters under investigation by either office.

In relation to the second issue, the Council notes that the Bill contains wide information gathering powers. However, as reflected in clause 12, these powers are to be exercised for the purpose of conducting reviews of the tax administration system, as set out in clause 7 of the Bill. As a result, while clause 15 provides that the Inspector-General may require the provision of information and documents, this provision is directed at tax officials and former tax officials, not individual taxpayers. There is no provision in the Bill to compel taxpayers to disclose individual information.

The Council also notes the restriction in clause 23 of the Bill on the publication of material provided to the Inspector-General that would allow taxpayers to be identified and the provision (clause 37) for the protection of the secrecy of individual taxpayer information in the hands of the Inspector-General and his or her staff.

Having regard to the focus of the Bill upon reviews of the tax administration system, to the fact that information relating to individual taxpayers is likely to be incidental to a review of the tax administration system and to the clauses of the Bill identified above, the Council is satisfied that information in relation to individual taxpayers is afforded sufficient protection under the Bill.

The Council trusts that these comments are of assistance to the Committee. Should you have any queries, please do not hesitate to contact Margaret Harrison-Smith of the Council Secretariat in the first instance on telephone number 6250 5800 or by email at margaret.harrison-smith@ag.gov.au.

Yours sincerely

Wayne Martin signature

Wayne Martin QC
President

Letter 5 Proposal to Establish a Postal Industry Ombudsman

The Council was invited to comment on the Department of Communications, Information Technology and the Arts proposal to establish a Postal Industry Ombudsman, along the lines of the current Telecommunications Industry Ombudsman, to handle customer complaints. While not unsupportive of the establishment of industry-based administrative review bodies, the Council considered there should be a demonstrable need for such a body. The letter of advice also raises a number of other matters concerning the proposed Postal Industry Ombudsman.

28 November 2002

Mr Paul Mooney
Postal Industry Ombudsman Submissions
Department of Communications,
Information Technology and the Arts
GPO Box 2154
Canberra ACT 2601

Dear Mr Mooney

Proposal to establish a Postal Industry Ombudsman

Thank you for inviting the Administrative Review Council (the Council) to make a submission in response to the Proposal to Establish a Postal Industry Ombudsman discussion paper developed by your Department.

The Council's submission is set out below. In the submission, the Council focuses on a number of issues that it believes require further consideration in relation to the proposed establishment of a Postal Industry Ombudsman (PIO).

Background

In the discussion paper it is proposed that the PIO would:

Further, it is proposed that the PIO would operate in a similar fashion to the Telecommunications Industry Ombudsman (the TIO) and that it would deal with complaints about postal operators 'such as Australia Post, courier companies, direct mail agents, document exchange operators, mail aggregators and related businesses' (paragraph 4, page 3 of the discussion paper). The PIO would have jurisdiction in relation to handling complaints about the conveyance of directed mail articles weighing between 2 and 20 kilograms and quality of service issues in relation to postal articles.

As noted in the discussion paper, there is no national regulation of private businesses offering postal services. However, a customer with a complaint about a postal service operator can currently refer that complaint to:

Council comments

In the Council's view, the establishment of any new administrative review body should be precipitated by a clear need for such a body. In recent times a number of industry ombudsman schemes have been established, especially in relation to areas that were previously publicly owned or regulated.[20] While generally not unsupportive of such schemes, the Council believes that such bodies should only be established where there is a demonstrable case that they would be welcomed by the community and are likely to impose consumer satisfaction by enhancing the efficiency and responsiveness of service delivery.

The Council considers that there are a number of areas where further information is required or additional analysis would be desirable to assist in assessing the need for a new national body for the investigation and resolution of postal complaints.

Number of complaints and levels of satisfaction with existing review mechanisms

Important considerations in determining the need for the proposed new body would be, in the Council's view, the number of complaints handled and the level of customer satisfaction with existing redress mechanisms.

Additionally, having regard to the range of postal service providers, an assessment of the nature and focus of complaints in different sectors of the industry would seem advisable in order to determine whether or not a single scheme would be both feasible and appropriate. The perception of postal operators themselves as to the need for a PIO would also appear to the Council to be relevant, particularly in view of the fact that it is proposed that the PIO be self funded.

No information is provided in the discussion paper as to the number or the range of complaints currently handled by the Commonwealth Ombudsman or by state and territory fair trading offices in relation to postal services. The Council notes, however, that the number of complaints received by the Commonwealth Ombudsman in relation to Australia Post is relatively low.[21] Similarly, no information has been provided as to the level of customer satisfaction or dissatisfaction with existing redress mechanisms.

A 'one stop shop'

One of the proposed objects of establishing a 'one stop shop' for the handling of postal complaints would seem to be to encourage 'consistent, binding national decision about complaints' (paragraph 3, page 3 of the discussion paper). However, the paper indicates that it is not the intention that the establishment of the PIO would extinguish the jurisdictions of the Commonwealth Ombudsman, state and territory fair trading offices, industry associations or the courts (paragraph 1.2, page 1 of the discussion paper).

As a result, it would seem that the establishment of a PIO could present an additional avenue for the resolution of postal disputes without necessarily fostering or promoting greater consistency in the handling of such complaints.

Overlap of functions

An important element of the proposed functions of the PIO would be the handling of individual customer complaints against postal operators. The paper does not describe very clearly how the new office would operate in relation to existing redress mechanisms. In the Council's view this issue needs to be resolved as the replication of functions has the potential to confuse members of the public as to which avenue of redress would best suit their situation.

Scope of proposed PIO functions

The discussion paper envisages a range of functions for the PIO.

Typically, the function of an ombudsman, including an industry ombudsman, is to undertake independent investigation into complaints about public bodies (in the case of the Commonwealth Ombudsman) and/or private sector bodies (in the case of industry ombudsmen such as the TIO and the Australian Banking Industry Ombudsman (ABIO)).

In addition to this role, however, the Council notes that the proposed PIO would have the ability to develop codes of practice and to report on service standards (paragraph 1.2, page 1 of the discussion paper). The Council notes that the TIO and the ABIO do not have powers to develop codes of practice. In the Council's view, this function is more appropriate for a regulator, a consumer body or an industry association than for an 'ombudsman'. The paper does not indicate to whom reports on service standards would be made or to what effect.

It is also proposed that the PIO would have the power to make decisions that would be binding on postal operators (paragraph 3, page 3 of the discussion paper) and the capacity to award compensation up to a prescribed limit. While the TIO has similar powers, the Council notes that no information is provided in the discussion paper as to why such powers would be necessary or desirable in the case of the PIO. Although part of the same government portfolio, the telecommunications and the postal services are arguably very different and may well warrant different approaches. Again, in the Council's opinion, such powers are more reflective of those of a regulator than an ombudsman.

While there are some limited exceptions, ombudsmen are generally strongly complaints-focussed and normally do not have determinative powers. Their capacity to influence outcomes by relying solely on their persuasive and recommendatory powers is a fundamental distinguishing feature of most ombudsman schemes.

Funding

In the discussion paper it is suggested that the PIO would be industry funded. Having regard to the range of activities envisaged for it, the PIO would need to be well-resourced to be able to undertake its many functions effectively. The likely costs of operating such a multi-faceted body, and possible strains on small postal operators in particular, would need to be taken into consideration and balanced against the need for such an office.

Codes of practice

In the case of Australia Post, it is said that there is in place 'a sophisticated in-house complaint procedure to monitor complaints and to identify potential systemic problems' (paragraph 1.3, page 1 of the discussion paper). It is also noted that some companies and industry associations have developed codes of practice and/or complaint management processes. There is therefore also the potential for replication where postal operators already have codes of practice or internal review procedures in place in response to the needs and expectations of their particular customers.

Further, small business postal operators may find it more difficult to comply with codes of practice than those that are better-resourced. When developing a code of postal practice, the PIO would therefore need to take into account the capacity of small business postal operators to comply with the code. In such a circumstance, a single code of practice may be inappropriate.

Concluding comments

In summary, the Council believes that further consideration should be given to the possible establishment of an office of the PIO having regard particularly to:

The Council trusts that these comments are of assistance. Should you have any queries, please do not hesitate to contact Margaret Harrison-Smith of the Council Secretariat in the first instance on telephone number 02 6250 5829 or by email at margaret.harrison-smith@ag.gov.au.

Yours sincerely

Wayne Martin signature

Wayne Martin QC
President

Letter 6 Review of recommendations of the Pharmaceutical Benefits Advisory Committee (1)

In December 2001 the Australian Pharmaceutical Manufacturers Association wrote to the Council about the lack of merits review of recommendations of the Pharmaceutical Benefits Advisory Committee. The Council consulted the Committee in the course of considering the Association's letter. The Council concluded that there was no justification for departing from its previously expressed view that merits review of PBAC recommendations was not appropriate. The advice also discusses whether the re-submission process available after a negative recommendation should be formalised but concludes that giving the process a legislative basis would not be beneficial. This advice was not published in the Council's 2001-02 annual report because the mater was still under discussion.

18 December 2001

Ms Jane Halton
Secretary
Department of Health and Ageing
GPO Box 9848
CANBERRA ACT 2601

Attention: Ms Diana Macdonell, Secretary, PBAC

Dear Ms Halton

Review of recommendations of the Pharmaceutical Benefits Advisory Committee

1. The Australian Pharmaceutical Manufacturers Association Inc. (APMA) wrote to the Council in December 2001 concerning the lack of merits review of recommendations of the Pharmaceutical Benefits Advisory Committee (PBAC) that a product not be made available as a pharmaceutical benefit. Officers of the ARC Secretariat have consulted the PBAC Secretariat during the Council's consideration of APMA's letter.

2. The Council maintains the view that it has previously expressed that merits review of those recommendations is not appropriate.

Legislative context

3. As you are aware, the PBAC is established under the National Health Act 1953 to make recommendations to the Minister for Health (the Minister) about which drugs and medicinal preparations should be made available as pharmaceutical benefits. The PBAC is also tasked to advise the Minister on any other matter relating to pharmaceutical benefits referred to it by the Minister.

4. In order to decide whether to recommend to the Minister that a drug or medicinal preparation be made available as a pharmaceutical benefit, PBAC gives consideration under subsection 101(3A) of the Act to the effectiveness and cost of the drug or preparation. That consideration includes a comparison of the effectiveness and cost of the therapy with alternative therapies, whether or not involving the use of other drugs or preparations.

5. The Minister may declare, pursuant to subsection 85(2) of the Act, that a drug or medicinal preparation be made available as a pharmaceutical benefit. However, a drug or preparation cannot be so declared unless PBAC has recommended to the Minister that it be so declared (subsection 101(4)). If PBAC does not make such a recommendation, the matter is not considered by the Minister. A declaration by the Minister that a drug be made available as a pharmaceutical benefit is subject to parliamentary scrutiny and disallowance (subsection 85(2B)).

Merits review of 'negative' PBAC recommendations

6. APMA argued in its letter that a PBAC recommendation not to list (negative recommendation) does have a substantive or operative effect. In support of its view APMA quoted the Council's statement in What Decisions should be Subject to Merits Review? that 'if ... a decision is styled as a recommendatory decision, but does in fact have a substantive or operative effect, it should not be excluded from merits review'.[22]

7. In 1995 the Council concluded that merits review of PBAC recommendations was not appropriate because such recommendations are not final determinations and are of no operative effect. The Council has
re-considered the issue in light of APMA's letter and has concluded that there is no justification for departing from its earlier view that merits review should not be available for PBAC recommendations.

8. PBAC is a multi-disciplinary body which engages in an extensive inquiry process and a complex assessment of economic, social and health factors when deciding whether to make a positive or negative recommendation. Its conclusions are reached by balancing competing factors. If agreement cannot be reached, a vote may be taken. This process is not amenable to review by a tribunal in an adjudicative decision-making process.[23] Given PBAC's composition and its decision-making processes, merits review of a PBAC decision may ultimately result in a decision of a lesser quality than the primary decision. It may also result in the Minister's decision being of a lesser quality in that the Minister would then be able to list pharmaceuticals contrary to PBAC's recommendation.

9. The Council notes the advice of the PBAC Secretariat that a re-submission process is available to applicants if PBAC makes a negative recommendation. This process is administrative and does not have a legislative basis. The Council has considered recommending that a right to re-submit be enshrined in the National Health Act. However, giving the process a legislative basis would require consideration of a number