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Cabinet Paper: Secondary Legislation Bill: Approval to introduce

Coversheet for proactive release

Hon David Parker
Attorney-General

Secondary Legislation Bill: Approval to introduce
Published 10 December 2019

This document has been proactively released.

Lodged: 26 November 2019
Title: Secondary Legislation Bill: Approval to introduce
Author: Office of the Attorney-General

© Crown Copyright, Creative Commons Attribution 4.0 International (CC BY 4.0)


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In Confidence

Office of the Attorney-General

Chair, Cabinet Legislation Committee

Secondary Legislation Bill: approval to introduce

Proposal

1   I propose that the Secondary Legislation Bill (the Bill) be introduced.

Policy

2   The Bill is a companion to the Legislation Act 2019.

3   In June 2017 Cabinet agreed—

3.1   that a bill be prepared to amend each provision in an enactment that enables secondary legislation to be made to clarify that instruments made under the provision are secondary legislation (and so must be published in accordance with the Legislation Act); and

3.2   that existing express exemptions from disallowance for instruments that will become secondary legislation will be preserved (SEC-17-MIN-0038; CAB-17-MIN-0285)

4   In April 2018, Cabinet agreed—

4.1   that in deciding whether or not instruments are secondary legislation, the focus should be on the substantive effect (and not the form) of an instrument: an instrument has legislative effect if it makes the law or alters its content, rather than just applying the law in a particular case; and

4.2   that secondary legislation made under the Royal prerogative can be defined in the Legislation Act by reference to a schedule (to be inserted by the Secondary Legislation Bill). The Schedule would list types of instruments made under the Royal prerogative that are secondary legislation any state any exemptions from publication or presentation that apply to them (LEG-18-MIN-0041; CAB-18-MIN-0131).

5   In March 2019, Cabinet agreed

5.1   the principles used to determine which provisions will be amended (or not) to state that the instruments made under them are secondary legislation

5.2   that the Bill be drafted with the presumption that an exemption that only applies to particular named persons is not legislative, whereas one that applies to a class of persons is

5.3   that exemptions from the publication requirements of the new Legislation Act will be conferred where Parliament has previously expressly authorised the makers to withhold publication of all or part of an instrument

5.4   that bylaws made under section 106(2) of the Reserves Act 1977, section 22AB of the Land Transport Act 1998, and section 12 of the Litter Act 1979 be given complete publication exemptions, as the very large number of entities that can make these bylaws makes them impractical to identify (LEG-19-MIN-0031; CAB-19-MIN-0106)

6   In March 2019, Cabinet authorised me—

6.1   to decide whether particular provisions should be considered to create secondary legislation, or whether an exemption from publication or disallowance should apply, where the decision is not clear-cut and there is concern about the consequences of amending them in one way or the other

6.2   to decide on a case-by-case basis, in order to avoid public disclosure of sensitive information, whether secondary legislation with a partial publication exemption should also be exempt from presentation (LEG-19-MIN-0031; CAB-19-MIN-0106).

The Bill

7   The Bill amends over 2,500 empowering provisions, in over 550 Acts, that enable secondary legislation to be made.

8   The Bill—

8.1   inserts a statement in each relevant provision that the instruments made under it are secondary legislation (and must be published in accordance with the new Legislation Act);

8.2   removes existing publication and notification requirements (eg, in the Gazette) for instruments that will become secondary legislation (unless there is a reason to preserve those requirements once the legislation is published in accordance with the Legislation Act 2019); and

8.3   removes references to the Legislation Act 2012 and the Interpretation Act 1999.

9   The Bill also provides for the exemption of a small number of instruments from the publication, presentation and disallowance requirements of the Legislation Act 2019. It does so by amending Schedule 3 of the Legislation Act (which lists exemptions from presentation and disallowance) and inserting a new schedule recording publication exemptions.

Exemptions from the general requirements of the Legislation Act

10   I undertook to draw to the attention of this Committee the exemptions approved by me under Cabinet’s delegated authority. Those exemptions are of the following kinds.

10.1   Publication exemption: the PCO need not publish, nor the maker lodge with the PCO for publication, the secondary legislation

10.2   Presentation exemption: the secondary legislation need not be presented to the House of Representatives

10.3   List exemption: the PCO need not publish, nor the maker lodge with the PCO for publication, minimum legislative information about the secondary legislation

10.4   Disallowance exemption: the secondary legislation is not disallowable by the House

11   The exemptions I have approved are listed in the appendix to this paper.

12   I would like to highlight those provisions for which a list exemption has been sought. These have the potential to be controversial because even the existence of the legislation in question need not be disclosed. The Regulations Review Committee has questioned the need for these exemptions, and the Legislation Design and Advisory Committee (LDAC) has advised that they should be kept to a minimum.

13   I am satisfied that these exemptions are appropriate because—

13.1   they only apply where the maker of the secondary legislation judges that its publication would be likely to prejudice national security or the safety of persons (or similar);

13.2   all of the provisions in question already—

13.2.1   either authorise the maker to only notify certain persons of the legislation and (expressly or by implication) withhold it from others; or

13.2.2   do not impose any notification or publication requirements.

14   I note also that exemptions from disallowance and presentation are constitutionally significant because they limit the House’s ability to supervise the exercise of powers Parliament has delegated. As Cabinet agreed earlier, existing exemptions from disallowance expressly set out in empowering legislation have been continued. In addition to these, I have approved new disallowance exemptions for—

14.1   directions of the Speaker of the House and determinations by the Minister Responsible for Ministerial Services relating to entitlements of members of Parliament and Ministers to travel services under sections 23, 27 and 32 of the Members of Parliament (Remuneration and Services) Act 2013. These exemptions are proposed to ensure that the Speaker and the Minister are able to determine travel entitlements independently and the Members of Parliament who receive these entitlements are not in control of the process that reviews them.

14.2   determinations and codes made by the Commerce Commission under the Telecommunications Act 2001.[1] These are not excluded from disallowance currently, but MBIE considers that position anomalous since determinations of a similar nature under other provisions in the Telecommunications Act 2001 have been expressly exempted by Parliament from disallowance.

15   In some cases, exemptions from the requirement to present are included to protect sensitive information in secondary legislation that its makers are authorised to withhold from publication. The Office of the Clerk has noted that exemptions from presentation are inconsistent with presentation’s purpose as politically significant as an exercise of Ministers’ accountability to the House. While this is true, there isn’t currently a way for presentation to avoid undermining the sensitivity which justifies non-publication.

16   The agencies responsible for the Acts that empower the making of the relevant secondary legislation have argued that exemptions from presentation are needed. They will be drawn to the attention of the select committee that considers the Bill and I expect them to be scrutinised carefully.

Additional approvals

Treatment of legislative instruments and expressly disallowable instruments

17   I earlier proposed that legislative instruments, and instruments that are disallowable by express statement of an Act, but that are more administrative than legislative in substance, would not become secondary legislation. A consequence of this would be that the House of Representatives would lose the ability to disallow those instruments (since the Legislation Act 2019 only provides for secondary legislation to be disallowed).

18   In the course of preparing the Bill, the PCO identified over 200 provisions that empower the making of instruments that might fall within this category (ie, currently disallowable under the Legislation Act 2012, but that may not have legislative effect). In view of this, and concerns raised by the Regulations Review Committee about the potential reduction in the House’s power to disallow instruments, further advice was obtained from the Legislation Design and Advisory Committee (LDAC). The LDAC recommends a cautious approach in these cases where Parliament has clearly made these instruments subject to disallowance. Even if an instrument is clearly administrative in nature, the empowering provisions may have to be redesigned to clearly state the scope of the power, how it will be exercised and rights of review, before the check provided by the possibility of disallowance is removed.

19   I propose therefore that legislative instruments, and instruments that are disallowable by express statement of an Act, be classed as secondary legislation, subject to the following exceptions.

19.1  Orders in Council implementing the overlay arrangements in Treaty Settlement legislation will not be secondary legislation. Instruments of this kind would not be classified as secondary legislation in the future settlement Acts, and it is important to maintain consistency between existing settlement Acts and those made in the future. The provisions empowering them will be amended to ensure the instruments remain publicly available in the Gazette. Post Settlement Governance Entities have been consulted on these amendments, and have not objected to them.

19.2  Rules made by racing bodies[2] to regulate the conduct of racing by those codes, and to control or prohibit admission to racecourses, under sections 29 and 34 of the Racing Act 2003 will not be secondary legislation. These are currently disallowable instruments and, as such, under the principles being used to classify instruments for the purposes of this Bill, they would normally be treated as secondary legislation. The racing bodies were consulted on proposed amendments to apply that treatment and did not support this position. They argued that, historically, the rules governing racing were merely contracts between the racehorse owners, racecourses etc, and Parliament essentially recognised these contractual rules that were in force at the time the Racing Act 1971, and the statutory framework has evolved since then without explicit consideration of whether the rules should be treated as an exercise of law-making power delegated by Parliament (or, rather, recognised as contractual arrangements as they started out). They consider the rules to be similar in nature to the rules of other sporting bodies that are not referred to in statute and, in future, can and should operate as contractual arrangements. The racing bodies would prefer that these issues be taken up in the context of the broader review of the racing industry which is expected shortly, and the legislation which will implement it. The proposal in this Secondary Legislation Bill (namely not to recognise the rules set by the racing bodies as secondary legislation at this stage) is to enable that to occur.

19.3  Commencement proclamations under the Cook Islands Constitution Act 1964 and the Niue Constitution Act 1974. The Acts provide for the self-government of those islands and should not be subject to New Zealand requirements (publication, presentation, disallowance).

Additional exemption of instruments made by reserves administering bodies

20   Cabinet agreed to exclude bylaws made by administered bodies of reserves under section 106 of the Reserves Act 1977 from the publication requirements of the Legislation Act. The reason for this is that there are potentially hundreds of reserve administering bodies, and no practical way to identify them or the bylaws made by them.

21   In drafting the Bill, the PCO and the Department of Conservation identified two further provisions in the Reserves Act (sections 57(2) and 65) that empower the making of secondary legislation by reserve administering bodies. For consistency of treatment, I propose that secondary legislation made by reserve administering bodies under sections 57(2) and 65 of the Reserves Act 1977 also be excluded from the publication requirements of the Legislation Act.

Further minor amendments to the Legislation Act 2019

22   The Bill would insert a new schedule into the new Legislation Act to list types of prerogative instruments that are secondary legislation, and amend the definition of secondary legislation to refer to that schedule (rather than to the criterion of them “having legislative effect”). This will bring prerogative instruments into line with secondary legislation made under a statutory empowering provision and avoid the possibility of these instruments failing to come into force based on a subsequent finding that they are legislative. These prerogative instruments are also listed in Part 1 of Schedule 3 of the Legislation Act 2019 (exemptions from presentation), reflecting the status quo position that there is not a statutory obligation to present them.

23   There are some additional minor and technical amendments to the Legislation Act’s framework to ensure that it works better with the amendments to empowering provisions across the statute book.

Impact analysis

24   The Regulatory Quality Team at the Treasury has determined that the regulatory decisions sought in relation to the proposal concerning access to secondary legislation are exempt from the requirement to provide an Impact Assessment as the relevant issues have been addressed in the business case.

Compliance

25   The Bill complies with:

25.1   the principles of the Treaty of Waitangi;

25.2   the rights and freedoms contained in the New Zealand Bill of Rights Act 1990 and the Human Rights Act 1993;

25.3   the disclosure statement requirements – a disclosure statement has been prepared and is attached to the paper; and

25.4   the principles and guidelines set out in the Privacy Act 1993.

26   The Bill departs from the Legislation Guidelines (2018 edition), which are maintained by the LDAC, to the extent that it provides for exemptions that allow makers to not disclose even the existence of certain secondary legislation (see paragraphs 12-13). I consider these departures justified because the secondary legislation that would be exempted relates to matters of national security or commercially sensitivity, and the ability to withhold details of it is already conferred in its empowering legislation.

Consultation

27   The following government departments and agencies were consulted on this paper: Crown Law Office, Department of Conservation, Department of Corrections, Department of Internal Affairs, Department of the Prime Minister and Cabinet, Government Communications Security Bureau, Inland Revenue Department, Land Information New Zealand, Ministry for Culture and Heritage, Ministry for Primary Industries, Ministry for the Environment, Ministry of Business, Innovation, and Employment, Ministry of Defence, Ministry of Education, Ministry of Foreign Affairs and Trade, Ministry of Health, Ministry of Housing and Urban Development, Ministry of Justice, Ministry of Social Development, Ministry of Transport, New Zealand Customs Service, New Zealand Defence Force, New Zealand Police, New Zealand Security Intelligence Service, Office of the Clerk, Oranga Tamariki—Ministry for Children, Parliamentary Service, Public Trust, Reserve Bank of new Zealand, State Services Commission, Sport (and Recreation) New Zealand, Statistics New Zealand, Te Puni Kokiri, and the Treasury.

28   The Office of the Clerk advised of its concerns about exemptions from presentation being inconsistent with Minister’s accountability to the House (discussed at paragraphs 15 and 16). As noted above, I see no way at present to avoid exemptions from presentation, but I expect these exemptions to be carefully scrutinised by the select committee that considers the Bill.

Binding on the Crown

29   The Acts that will be amended by the Bill are, for the most part, already binding on the Crown.

Allocation of decision-making powers

30   The Bill does not affect the allocation of decision-making powers between the executive, the courts, and tribunals.

Associated regulations

31   Regulations under clause 147 of the Legislation Act 2019 will be needed to prescribe minimum requirements for the manner in which secondary legislation, or a part of secondary legislation, must be published, notified, or otherwise made available for empowering provisions that are enacted on or after the commencement of this Bill and relevant Parts of the Legislation Act 2019. They will be of low complexity.

Other instruments

32   The Bill does not include provision to make other instruments that are deemed to be legislative instruments or disallowable instruments (or that will be secondary legislation).

Definition of Minister/department

33   The Bill does not contain a definition of Minister, department (or equivalent government agency), or chief executive of a department (or equivalent position).

Commencement of legislation

34   The Bill will come into force on 1 or more dates set by Order in Council, or to the extent not brought into force earlier, on the fifth anniversary of the date of Royal assent. The Bill provides for commencement by Order in Council because it must come into force at the same time as the main provisions of the new Legislation Act. The Bill is expected to be commenced along with the Legislation Act in mid-2020.

35   The explanatory note of the Bill sets out the reasons for commencement by Order in Council.

Parliamentary stages

36   The Bill should be introduced by 12 December 2019, and enacted by July 2020.

37   I propose that the Bill be referred to the Regulations Review Committee.

Proactive Release

38   I will release this paper proactively subject to redactions as appropriate under the Official Information Act 1982.

Recommendations

The Attorney-General recommends that the Cabinet Legislation Committee—

1   note that the Secondary Legislation Bill (the Bill) holds a category 5 priority (to be referred to a select committee in the year) on the 2019 Legislation Programme;

2   note that the Bill—

2.1   amends each provision that empowers the making of instruments with legislative effect to state that those instruments are secondary legislation (and must be published in accordance with the new Legislation Act); and

2.2   removes existing publication and notification requirements, eg, in the Gazette, from empowering provisions for instruments that will become secondary legislation (but those requirements continue to apply until centralised publication starts);

2.3   removes references to the Legislation Act 2012 and the Interpretation Act 1999;

2.4   provides for the exemption of a small number of instruments from the publication, presentation and disallowance requirements of the Legislation Act 2019;

3   agree that legislative instruments, and instruments that are disallowable by express statement of an Act, be classed a secondary legislation (even though they may be considered not to have legislative effect), with the following exceptions:

3.1   Orders in Council implementing the overlay arrangements in Treaty Settlement legislation

3.2   Rules made by racing codes to regulate the conduct of racing by those codes, and to control or prohibit admission to racecourses, under sections 29 and 34 of the Racing Act 2003

3.3   Commencement proclamations under the Cook Islands Constitution Act 1964 and the Niue Constitution Act 1974

4   agree that secondary legislation made by reserve administering bodies under sections 57(2) and 65 of the Reserves Act 1977 also be excluded from the publication requirements of the Legislation Act 2019

5   note that the Bill will—

5.1   amend the new Legislation Act, by inserting a new schedule listing types of prerogative instruments that are secondary legislation, and amend the definition of secondary legislation to refer to that schedule

5.2   make some additional minor and technical amendments to the new Legislation Act’s framework so that it works better with the amendments to empowering provisions across the statute book.

6   agree that the Bill be referred to the Regulations Review Committee;

7   approve the introduction of the Bill;

8   agree that the Bill be introduced by 12 December 2019.

Authorised for lodgement

Hon David Parker
Attorney-General

Appendix 1: Exemptions approved under delegated authority

Empowering provisionNature of the instrumentExemption(s) soughtRationale for exemption(s)
Animal Products Act 1999 Section 60A Notice by the Director-General specifying requirements for animal products intended for export Publication and presentation Notices may contain information that, if disseminated, would:
  • disclose commercially sensitive information
  • disclose a trade secret
  • prejudice New Zealand’s position in current or future negotiations for overseas market access, or
  • prejudice the international relations of New Zealand.
Biosecurity Act 1993
Section 131
Notices enabling movement and other controls against unwanted organisms Publication and presentation Some notices may contain information that is commercially sensitive or would prejudice New Zealand’s overseas market access
Civil Aviation Act 1990
Section 28
Ordinary rules made by the Minister Publication and presentation The Minister may, for reasons of security, notify an ordinary rule only to such persons as he or she considers appropriate or necessary in the circumstances
Civil Aviation Act 1990
Section 31
Emergency rules made by the Director Publication and presentation The Director may, for reasons of security, notify an emergency rule only to such persons as he or she considers appropriate or necessary in the circumstances
Civil Aviation Act 1990
Section 34A
Ordinary rules made by the Governor-General Publication and presentation The Minister may, for reasons of security, notify an ordinary rule only to such persons as he or she considers appropriate or necessary in the circumstances
Civil Aviation Act 1990
Section 77BA
Notices requiring screening, searching, and seizing Publication and presentation Requirements for screening, searching and seizing may include security sensitive information, but the published notices must omit such information. These exemptions therefore preserve the status quo.
Electronic Identity Verification Act 2012
Section 47
Standards or specifications for the use of electronic identity credentials or electronic identity photographs Publication and presentation The Chief Executive may withhold portions of specifications and standards for reasons in the Official Information Act 1982 or to protect the security or integrity of the Electronic Identity Verification Service
Members of Parliament (Remuneration and Services) Act 2013
Section 23
Speaker's directions setting out the entitlements of members of Parliament to travel services Disallowance To enable the Speaker to determine travel entitlements independently
Members of Parliament (Remuneration and Services) Act 2013
Section 27
Determination by the Minister Responsible for Ministerial Services as to the travel entitlements of Ministers Disallowance To enable the Minister to determine travel entitlements independently
Members of Parliament (Remuneration and Services) Act 2013
Section 32
Amendments to Speaker's directions and Minister's determinations as to travel entitlements Disallowance To enable the Speaker and the Minister to determine travel entitlements independently
Parliamentary Service Act 2000
Section 25
Resolution under to add or exclude land from the parliamentary precincts Presentation A resolution of the House need not be presented to the House
Wine Act 2003
Section 41(2)
Notice specifying the manner in which the access requirements for overseas markets may or must be met Publication and presentation Notices may contain information that, if disseminated, would
  • disclose commercially sensitive information
  • disclose a trade secret
  • prejudice New Zealand’s position in current future negotiations for overseas market access, or
  • prejudice the international relations of New Zealand
Armed Forces Discipline Act 1971
Section 206
Defence Force Orders relating to Armed Forces discipline List and publication exemption Some Defence Force Orders contain information that would, if disseminated, prejudice the security or defence of NZ or the international relations of the Government. Details relating to Defence Force Orders, such as the Order relating to Special Forces, may also need to remain confidential.
Defence Act 1990
Section 27
Defence Force Orders List and publication Some Defence Force Orders contain information that would, if disseminated, prejudice the security or defence of NZ or the international relations of the Government. Details relating to Defence Force Orders, such as the Order relating to Special Forces, may also need to remain confidential.
Health and Safety at Work Act 2015
Section 8
Notices declaring that parts of the Act or regulations do not apply (or apply with modifications) to workers carrying out work for NZSIS or GCSB List and publication Declarations may contain information that, if disseminated, would prejudice the security or defence of New Zealand or the international relations of the Government. Details about the instrument may indicate the timing or general nature of a planned operational activity.
International Terrorism (Emergency Powers) Act 1987
Section 14
Notice prohibiting publication or broadcasting of certain matters relating to international terrorist emergency List and publication Notices may contain information likely to endanger the safety of persons or prejudice measures designed to deal with international terrorist emergencies
International Terrorism (Emergency Powers) Act 1987
Section 15
Notice prohibiting publication or broadcasting of certain matters relating to international terrorist emergency List and publication Notices may contain information likely to endanger the safety of persons or prejudice measures designed to deal with international terrorist emergencies
Telecommunications (Interception Capability and Security) Act 2013
Section 29
Exemption granted by a designated officer from sections 9 and 10 of the Act, which require telecommunications network operators to have full interception capability List and publication Publication or presentation of exemptions may disseminate information about particular gaps in the interception capability of certain services. Even the titles of exemptions may be informative about those gaps.
Telecommunications (Interception Capability and Security) Act 2013
Section 34
Exemption granted by the Minister from sections 9 and 10 of the Act, which require telecommunications network operators to have full interception capability List and publication Publication or presentation of exemptions may disseminate information about particular gaps in the interception capability of certain services. Even the titles of exemptions may be informative about those gaps.
Financial Markets Conduct Act 2013
Section 556
Exemptions from the Act or regulations in relation to a particular person or transaction, or persons associated with, or transactions involving, a particular person. List and presentation Financial Markets Authority (FMA) may defer compliance on the ground of commercial confidentiality.
Takeovers Act 1993
Section 45(1)(a) and (b)
Exemptions from the Takeovers Code List and presentation Takeovers Panel may defer compliance on the ground of commercial confidentiality.
Telecommunications Act 2001
Sections 27, 39, 51, 87, 94J
Commerce Commission determinations concerning designated and specified telecommunication services and telecommunications service obligations Presentation and disallowance Consistency with other instruments of a similar nature under other provisions in the Telecommunications Act 2001 that Parliament has already expressly exempted from disallowance.
Telecommunications Act 2001
Sections 236 and 238, clauses 10 and 17 of Schedule 2, and clause 3 of Schedule 2A
Codes made or approved by the Commerce Commission Presentation and disallowance Consistency with other instruments of a similar nature under other provisions in the Telecommunications Act 2001 that Parliament has already expressly exempted from disallowance.

 

[1] The determinations are made under sections 27, 39, 51, 87, and 94J of the Act. The codes are made under sections 236, 238, clauses 10 and 17 of Schedule 2, and clause 3 of Schedule 2A.

[2] That is, New Zealand Thoroughbred Racing Incorporated, Harness Racing New Zealand Incorporated, and the New Zealand Greyhound Racing Association (Incorporated)

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