EXPLANATORY STATEMENT
STATUTORY RULE 1985 NO. 322 ISSUED BY THE AUTHORITY OF THE MINISTER FOR COMMUNICATIONS
Section 116 of the Postal Services Act 1975 (the Act) provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing all matters which by the Act are required or permitted to be prescribed by the regulations, or which are necessary or convenient to be prescribed by the regulations for carrying out or giving effect to the Act.
Section 82 of the Act provides that the Postal Services Commission (the Commission) shall not enter into a contract involving the payment or receipt by the Commission of an amount exceeding $500,000 or, if a higher amount is prescribed by the regulations, that higher amount, except with the approval of the Minister.
The number of contracts exceeding $500,000 in value has increased significantly since the commencement of the Act, owing to inflation and the growth of the Commission. The Minister is now required to approve many contracts of a relatively minor nature. The Prime Minister, the Treasurer and the Minister for Finance supported a proposal that the threshold should be increased from $500,000 to $2,000,000. This is consistent with the level of contract approval granted to the Australian Telecommunications Commission.
The Postal Services Regulations (Amendment) inserts a new regulation 57 of the Postal Services Regulations which provides that for the purpose of section 82 of the Act, the prescribed amount is $2,000,000.
Overview
The Postal Services Regulations (Amendment) Statutory Rule 1985 No. 322 was enacted to address the growing number of contracts exceeding the previous threshold of $500,000 that required ministerial approval, a situation exacerbated by inflation and the expansion of the Postal Services Commission. This amendment to the Postal Services Regulations was introduced under the authority of the Minister for Communications and follows the support of the Prime Minister, the Treasurer, and the Minister for Finance for raising the approval threshold to $2,000,000, aligning it with the contract approval level granted to the Australian Telecommunications Commission. The policy objective behind this legislative change is to streamline the approval process for contracts, allowing the Commission to manage more contracts internally without requiring ministerial intervention for relatively minor financial commitments.
Scope and Application
The Postal Services Regulations (Amendment) 1985, issued under the authority of the Minister for Communications, modifies the existing framework set forth by the Postal Services Act 1975. This legislation applies to the Postal Services Commission, a statutory body responsible for various postal services within Australia. The amendment specifically adjusts the financial threshold for contracts that require ministerial approval, raising it from $500,000 to $2,000,000. This change aims to alleviate the burden on the Minister by reducing the number of relatively minor contracts that need approval, aligning it with the standards applied to the Australian Telecommunications Commission. The amendment is geographically applicable across Australia, as it pertains to the operations of the Commonwealth-established Commission. The new threshold applies uniformly across all states and territories, ensuring consistent application nationwide. There are no stated exclusions or exemptions within the amendment itself, although the original Act may contain such provisions. The application and enforcement of these regulations are further governed by subordinate instruments, which may provide additional detail or clarification on specific implementation aspects.
Key Provisions
The main operative sections of the Statutory Rule 1985 No. 322 are sections 116 and 82 of the Postal Services Act 1975 (the Act). Section 116 allows the Governor-General to create regulations that are necessary for carrying out the Act, while Section 82 of the Act sets a threshold for the value of contracts that the Postal Services Commission (the Commission) can enter into without the approval of the Minister. Originally, this threshold was $500,000, but this new amendment raises it to $2,000,000. This means that contracts valued at $2,000,000 or more now require ministerial approval before the Commission can enter into them.
The obligations imposed by the Act on the parties and entities it governs are primarily concerned with contract approval thresholds. The Postal Services Commission must seek and obtain approval from the Minister for contracts exceeding the prescribed amount, which has now been set at $2,000,000. The Minister, in turn, must ensure that the threshold is appropriate given the nature and scope of the Commission’s activities. This requirement is intended to ensure that significant financial commitments are appropriately authorised and controlled, maintaining accountability and financial prudence.
The new regulations also include provisions for potential breaches and their consequences. The Act does not explicitly detail offences or penalties for non-compliance with the new threshold requirements, but generally, breaches of statutory requirements can lead to legal consequences. Non-compliance might result in the invalidity of the contract, financial penalties, or legal action against the parties involved. The specific nature and severity of penalties would be determined based on the context and the resultant impact of the breach, potentially including civil liability for damages or criminal charges depending on the intent and extent of the breach.