EXPLANATORY STATEMENT
Issued by the Authority of the Minister for Finance
Financial Framework (Supplementary Powers) Act 1997
Financial Framework (Supplementary Powers) Amendment (Employment and Workplace Relations Measures No. 3) Regulations 2023
The Financial Framework (Supplementary Powers) Act 1997 (the FFSP Act) confers on the Commonwealth, in certain circumstances, powers to make arrangements under which money can be spent; or to make grants of financial assistance; and to form, or otherwise be involved in, companies. The arrangements, grants, programs and companies (or classes of arrangements or grants in relation to which the powers are conferred) are specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the Principal Regulations). The powers in the FFSP Act to make, vary or administer arrangements or grants may be exercised on behalf of the Commonwealth by Ministers and the accountable authorities of non‑corporate Commonwealth entities, as defined under section 12 of the Public Governance, Performance and Accountability Act 2013.
The Principal Regulations are exempt from sunsetting under section 12 of the Legislation (Exemptions and Other Matters) Regulation 2015 (item 28A). If the Principal Regulations were subject to the sunsetting regime under the Legislation Act 2003, this would generate uncertainty about the continuing operation of existing contracts and funding agreements between the Commonwealth and third parties (particularly those extending beyond 10 years), as well as the Commonwealth’s legislative authority to continue making, varying or administering arrangements, grants and programs.
Additionally, the Principal Regulations authorise a number of activities that form part of intergovernmental schemes. It would not be appropriate for the Commonwealth to unilaterally sunset an instrument that provides authority for Commonwealth funding for activities that are underpinned by an intergovernmental arrangement. To ensure that the Principal Regulations continue to reflect government priorities and remain up to date, the Principal Regulations are subject to periodic review to identify and repeal items that are redundant or no longer required.
Section 32B of the FFSP Act authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Principal Regulations. Section 32B also authorises the Commonwealth to make, vary and administer arrangements for the purposes of programs specified in the Principal Regulations. Section 32D of the FFSP Act confers powers of delegation on Ministers and the accountable authorities of non-corporate Commonwealth entities, including subsection 32B(1) of the Act. Schedule 1AA and Schedule 1AB to the Principal Regulations specify the arrangements, grants and programs.
Section 65 of the FFSP Act provides that the Governor-General may make regulations prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.
The Financial Framework (Supplementary Powers) Amendment (Employment and Workplace Relations Measures No. 3) Regulations 2023 (the Regulations) amend Schedule 1AB to the Principal Regulations to establish legislative authority for government spending on the Reducing silicosis and other silica-related diseases by increasing awareness program (the program), which will be administered by the Department of Employment and Workplace Relations.
The program comprises two funding activities: a communications strategy on a prohibition on the use of engineered stone and the Safe Work Australia (SWA) social partners grant, which seeks to address the rise of silicosis and persistent lack of compliance with obligations and responsibilities imposed under Work Health and Safety (WHS) laws.
Under the communications strategy, the Government will provide funding of $9.3 million over two years from 2023-24 to support any decision by WHS Ministers to prohibit the use of engineered stone under the model WHS laws. The communications campaign would address a broad, national audience to ensure consumers, workers and businesses that are likely to be affected by any decision of state and territory governments to prohibit or limit the use of engineered stone receive clear and consistent information.
Under the SWA social partners grant, the Government will provide funding of $1.2 million over two years from 2023-24 to SWA’s social partner organisations to undertake national awareness and behaviour change initiatives to improve businesses and workers’ understanding of the risks and subsequent implementation of good work practices in managing silica dust within the workplace. These organisations represent employers’ and workers’ organisations and are the Australian Council of Trade Unions, the Australian Chamber of Commerce and Industry, and the Australian Industry Group.
Details of the Regulations are set out at Attachment A. A Statement of Compatibility with Human Rights is at Attachment B.
The Regulations are a legislative instrument for the purposes of the Legislation Act 2003.
The Regulations commence on the day after registration on the Federal Register of Legislation.
Consultation
In accordance with section 17 of the Legislation Act 2003, consultation has taken place with the Department of Employment and Workplace Relations.
A regulatory impact analysis is not required as the Regulations only apply to non‑corporate Commonwealth entities and do not adversely affect the private sector.
Attachment A
Details of the Financial Framework (Supplementary Powers) Amendment
(Employment and Workplace Relations Measures No. 3) Regulations 2023
Section 1 – Name
This section provides that the title of the Regulations is the Financial Framework (Supplementary Powers) Amendment (Employment and Workplace Relations
Measures No. 3) Regulations 2023.
Section 2 – Commencement
This section provides that the Regulations commence on the day after registration on the Federal Register of Legislation.
Section 3 – Authority
This section provides that the Regulations are made under the Financial Framework (Supplementary Powers) Act 1997.
Section 4 – Schedules
This section provides that the Financial Framework (Supplementary Powers) Regulations 1997 are amended as set out in the Schedule to the Regulations.
Schedule 1 – Amendments
Financial Framework (Supplementary Powers) Regulations 1997
Item 1 – In the appropriate position in Part 4 of Schedule 1AB (table)
This item adds one new table item to Part 4 of Schedule 1AB to establish legislative authority for government spending on an activity to be administered by the Department of Employment and Workplace Relations (the department).
New table item 645 establishes legislative authority for government spending on the reducing silicosis and other silica-related related diseases by increasing awareness program (the program). The program seeks to address the growing rate of silicosis and other
silica- related diseases in Australian workers.
The Government is committed to taking urgent action to address the growing rate of silicosis and other silica-related diseases in Australian workers through two funding activities: a communications strategy for a prohibition on the use of engineered stone and grants to Safe Work Australia (SWA) social partners to undertake national awareness and behaviour change initiatives in the workplace.
Communications strategy for a prohibition on the use of engineered stone
Engineered stone is an artificial product that is created by combining natural stone materials that contain crystalline silica with other chemicals. Engineered stone is chemically different from natural stone, containing high levels of silica (up to 97 per cent) and other compounds (resins, pigments). When engineered stone is processed by cutting, grinding and polishing, the dust generated contains higher levels of respirable crystalline silica (RCS), and that RCS has different physical and chemical properties to RCS in natural stone. Exposure to RCS from engineered stone causes silicosis and other silica-related diseases, and Australia’s diagnoses have risen substantially in recent years.
Cases of silicosis and silica-related diseases, caused by the inhalation of RCS, are increasing. Workers across a range of industries are affected, however a disproportionate number of diagnoses are in engineered stone workers, a majority of which are under 35 years old.
Following a request by Work Health and Safety (WHS) Ministers in February 2023, SWA, the national WHS policy body, prepared the Decision Regulation Impact Statement: Prohibition on the use of engineered stone (Decision RIS). On 27 October 2023, the Minister for Employment and Workplace Relations, the Hon Tony Burke MP, announced the agreement of all jurisdictions for SWA to publicly release the Decision RIS. The media release is available at (https://ministers.dewr.gov.au/burke/release-safe-work-australia-report-silicosis).
The Decision RIS (https://www.safeworkaustralia.gov.au/doc/decision-regulation-impact-statement-prohibition-use-engineered-stone), strongly recommended a prohibition on the use of all engineered stone immediately to address the rise of silicosis diagnoses within the industry and persistent lack of compliance with obligations and responsibilities imposed under WHS laws across the engineered stone industry at all levels. This recommendation was made for the following reasons:
- engineered stone workers are significantly over-represented in cases of silicosis and silica-related diseases;
- engineered stone workers are being diagnosed with silicosis at a much younger age than workers from other industries;
- engineered stone is chemically different from natural stone, containing high levels of silica (up to 97 per cent) and other compounds (resins, pigments) which may pose additional health risks such as chronic kidney disease, autoimmune diseases, and eye irritation and damage; and
- there is no toxicological evidence of a ‘safe’ threshold of a crystalline silica content in engineered stone.
The Decision RIS noted that silicosis is preventable however there has been a persistent lack of compliance with, and enforcement of, the obligations imposed under WHS laws across the engineered stone industry.
The Government will provide funding of $9.3 million over two years from 2023-24 for a communications strategy to support any decision by WHS Ministers to prohibit the use of engineered stone under the model WHS laws, following consideration of the Decision RIS. The strategy would address a broad, national audience to ensure consumers, workers and businesses that are likely to be affected by a prohibition on the use of engineered stone receive nationally consistent messaging targeted to their specific needs, mitigating risks associated with misinformation in the public domain.
SWA social partners grant
The SWA social partners grant forms part of the Government’s $10.0 million Addressing Silicosis and Silica-Related Diseases measure announced in the 2023-24 Budget. The measure includes funding of $1.2 million over two years from 2023-24 for SWA social partners to deliver national awareness and behaviour change initiatives for silica dust in the workplace.
The organisations that are eligible to apply for a grant have operated extensively in WHS matters to drive national WHS policy and are members of SWA’s tripartite body (Members). As Safe Work Australia Members, these social partners are uniquely positioned to engage directly with businesses and workers to drive change and influence good WHS practices across a range of industries. These partners include:
- the Australian Council of Trade Unions (ACTU): the peak body for Australian unions, made up of 38 affiliated unions, represents a broad coverage of the Australian workforce, including in construction, mining, and manufacturing industries;
- the Australian Industry Group (Ai Group): a peak industry body representing more than 60,000 businesses employing more than 1 million staff. Members come from a range of industries, including construction, engineering and manufacturing, representing both small and large businesses; and
- the Australian Chamber of Commerce and Industry (ACCI): the Chamber operates as a diverse platform with a network of 84 industry associations, 94 business leaders, state and territory chambers of commerce and the Australian division of the International Chamber of Commerce.
These organisations give broad representation across the Australian workplaces that operate in silica dust generating industries.
The grant will support the SWA social partners to develop and deliver a range of education and awareness raising activities and tools to support businesses and workers understand the risks of exposure to RCS and subsequent implementation of good work practices in managing silica dust within the workplace. These activities will be focused on businesses and workers who work in silica dust generating industries such as engineered stone, construction, manufacturing, tunnelling, quarrying, demolition and mining.
The department will deliver the program through a range of procurement and grant processes depending on the nature of the activity.
Funding activities for the engineered stone communications strategy will be administered in accordance with the Commonwealth resource management framework, including the Public Governance, Performance and Accountability Act 2013 (PGPA Act) and the Commonwealth Procurement Rules (CPR).
Advertising services for the communications strategy will be procured via the Government Communications Campaign Panel (the Panel) pursuant to the PGPA Act. The panel arrangement will be administered under AusTender (SON ID: SON3754402). The Government Communications Subcommittee (GCS) will assign suppliers from the Panel to work on the campaign. The department will prepare requests for quotation for suppliers, evaluate responses to ensure they are fit for purpose and provide value for money, and prepare and execute Work Orders.
Final decisions will be made by the delegate of the Secretary of the department, a senior executive service (SES) officer and the GCS. The contract will be publicly available on the AusTender website (www.tenders.gov.au).
The grant to SWA social partners will be delivered through a closed, non-competitive selection process in accordance with the PGPA Act and the Commonwealth Grants Rules and Guidelines 2017.
The Business Grant Hub, within the Department of Industry, Science and Resources will administer grants funding on behalf of the department. The grant eligibility and assessment criteria will be contained within the grant opportunity guidelines, which will be developed and published on the Business Grant Hub’s website (www.business.gov.au).
The Minister for Employment and Workplace Relations and/or the delegate (at SES level) will decide which grants to approve taking into account the application assessment and the availability of grant funding, including the delegation instrument under the Financial Framework (Supplementary Powers) Act 1997 and the PGPA Act.
Funding decisions related to the program will not be subject to independent merit review as the decisions relate to the allocation of a finite resource, from which all potential claims cannot be met. Any funding that has already been allocated would be affected if the original decision was overturned. The grant will involve a closed, non-competitive selection process and funding available under the grant is strictly capped and all available amounts have been allocated. The remaking of a procurement decision after entry into a contractual arrangement with a successful service provider is legally complex, impractical, and could result in delays in the implementation of the communications strategy. The Administrative Review Council has recognised that it is justifiable to exclude merits review in relation to decisions of this nature (see paragraphs 4.11 to 4.19 of the guide, What decisions should be subject to merit review?).
The Government Procurement (Judicial Review) Act 2018 enables service providers to challenge some procurement processes for alleged breaches of certain procurement rules. This legislation might provide an additional avenue of redress (compensation or injunction) for dissatisfied providers or potential providers, depending on the circumstances.
In July 2022, SWA sought public submissions from a number of stakeholders on regulatory and non-regulatory options to manage respirable crystalline silica in Australian workplaces. These submissions are available on SWA’s website (https://engage.swa.gov.au/cris-managing-the-risks-of-respirable-crystalline-silica). In March 2023, SWA also sought public submissions on options to prohibit the use of engineered stone, which are also publicly available (https://engage.swa.gov.au/prohibition-on-the-use-of-engineered-stone).
The stakeholders consulted included businesses who operate in silica-dust generating industries such as construction and mining; unions and peak industry organisations; state and territory regulators; and experts such as occupational hygienists and occupational physicians. National awareness and behaviour change initiatives received consistent support amongst all stakeholder groups to reduce the risks of RCS exposure at work.
The department will undertake appropriate consultation on a communications strategy for a prohibition on engineered stone with relevant advertising agencies, including on development of media strategies and materials.
Funding of $9.3 million for the communications strategy is included in the 2023-24 Mid-Year Economic and Fiscal Outlook and the Portfolio Additional Estimates Statements for the Employment and Workplace Relations Portfolio. Funding will come from Program 3.1: Workplace Support, which is part of Outcome 3.
Funding of $1.2 million for the SWA social partners grant was included in the 2023-24 Budget under the measure ‘Addressing Silicosis and Silica-Related Diseases’ for a period of two years commencing in 2023-24. Details are set out in Budget 2023-24, Budget Measures, Budget Paper No. 2 at page 104.
Funding for this item came from Program 3.1: Workplace Support, which is part of
Outcome 3. Details are set out in the Portfolio Budget Statements 2023-24, Budget Related Paper No. 1.6, Employment and Workplace Relations Portfolio at pages 17 and 27.
Noting that it is not a comprehensive statement of relevant constitutional considerations, the objective of the item references the following powers of the Constitution:
the communications power (section 51(v));
the external affairs power (section 51(xxix)); and
the territories power (section 122).
Communications power
Section 51(v) of the Constitution empowers the Parliament to make laws with respect to 'postal, telegraphic, telephonic and other like services'.
Funding under this program may support the delivery of information, advice or education by email or the internet, radio or television.
External affairs power
Section 51(xxix) of the Constitution empowers the Parliament to make laws with respect to 'external affairs'. The external affairs power relevantly supports legislation implementing Australia's international obligations under treaties to which it is a party.
Australia is a party to the International Covenant on Economic, Social and Cultural Rights (ICESCR). States Parties to the ICESCR are required to take steps with a view to achieving progressively the full realisation of the rights recognised in the Covenant by all appropriate means (Art 2(1)).
The steps to be taken by States Parties to achieve the full realisation of the right to enjoyment of the highest attainable standard of physical and mental health (as required by Art 12(1)) are specified in Art 12(2). They include the improvement of all aspects of environmental and industrial hygiene (Art 12(2)(b)) and the prevention, treatment and control of epidemic, endemic, occupational and other diseases (Art 12(2)(c)). Workers in a broad range of industries including manufacturing, stonemasonry, construction, tunnelling, demolition, mining and quarrying are exposed to respirable crystalline silica. The program will assist in eradicating silicosis and other silica-related diseases by increasing awareness of the risks associated with exposure to respirable crystalline silica and the safe work practices that should be adopted by silica dust generating industries.
Territories power
Section 122 of the Constitution empowers the Parliament to 'make laws for the government of any territory'.
The program will fund the delivery of information, advice and education to people who live or work in a Territory.
Attachment B
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Financial Framework (Supplementary Powers) Amendment (Employment and Workplace Relations Measures No. 3) Regulations 2023
This disallowable legislative instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the legislative instrument
Section 32B of the Financial Framework (Supplementary Powers) Act 1997 (the FFSP Act) authorises the Commonwealth to make, vary and administer arrangements and grants specified in the Financial Framework (Supplementary Powers) Regulations 1997 (the FFSP Regulations) and to make, vary and administer arrangements and grants for the purposes of programs specified in the Regulations. Schedule 1AA and Schedule 1AB to the FFSP Regulations specify the arrangements, grants and programs. The powers in the FFSP Act to make, vary or administer arrangements or grants may be exercised on behalf of the Commonwealth by Ministers and the accountable authorities of non‑corporate Commonwealth entities, as defined under section 12 of the Public Governance, Performance and Accountability Act 2013.
The Financial Framework (Supplementary Powers) Amendment (Employment and Workplace Relations Measures No. 3) Regulations 2023 amends Schedule 1AB to the FFSP Regulations to establish legislative authority for government spending on the Reducing silicosis and other silica-related diseases by increasing awareness program (the program), which will be administered by the Department of Employment and Workplace Relations.
The program comprises two funding activities: a communications strategy and the Safe Work Australia (SWA) social partners grant:
- funding of $9.3 million over two years from 2023-24 will support any decision by Work Health and Safety (WHS) Ministers to prohibit the use of engineered stone under the model WHS laws. The communications strategy would address a broad, national audience to ensure consumers, workers and businesses that are likely to be affected by any decision of state and territory governments to prohibit or limit the use of engineered stone receive clear and consistent information; and
- funding of $1.2 million over two years from 2023-24 would support SWA’s social partners organisations to undertake national awareness and behaviour change initiatives to improve businesses and workers’ understanding of the risks and subsequent implementation of good work practices in managing silica dust within the workplace. These organisations represent employers’ and workers’ organisations and are the Australian Council of Trade Unions, the Australian Chamber of Commerce and Industry, and Australian Industry Group.
Human rights implications
This disallowable legislative instrument engages the following right:
- the right to the enjoyment of just and favourable conditions of work– Article 12 of the International Covenant on Economic Social and Cultural Rights (ICESCR), read with Article 2.
Right to the enjoyment of just and favourable conditions of work
Article 2 of the ICESCR requires States Parties to take steps to progressively achieve the full realisation of the rights recognised in the ICESCR by all appropriate means.
Article 12 of the ICESCR recognises the right of everyone to the enjoyment of the highest attainable standard of physical and mental health. This includes steps to be taken to improve all aspects of environmental and industrial hygiene and the prevention, treatment and control of epidemic, endemic, occupational and other diseases.
This disallowable legislative instrument would contribute to meeting this obligation by developing awareness raising and behaviour initiatives to improve businesses and workers’ understanding of the risks and subsequent implementation of good work practices in managing silica dust within the workplace, thereby supporting the prevention of silicosis and silica-related diseases.
Conclusion
This disallowable legislative instrument is compatible with human rights because it promotes the protection of human rights.
Senator the Hon Katy Gallagher
Minister for Finance