EXPLANATORY STATEMENT
STATUTORY RULE 1987 No 335 ISSUED BY THE AUTHORITY OF THE MINISTER FOR TRANSPORT AND COMMUNICATIONS
Section 112 of the Telecommunications Act 1975 (‘the Act’) provides that the Governor-General may make regulations, not inconsistent with the Act, prescribing all matters 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.
Subsection 79(1) of the Act provides that the Australian Telecommunications Commission must obtain the Minister’s approval before entering into a contract exceeding the amount of $500,000, or if a higher amount is prescribed by regulations, that higher amount.
Regulation 42A of the Telecommunications Regulations previously provided that, for the purposes of subsection 79(1) of the Act, the prescribed higher amount was $2,000,000.
It was decided to increase the prescribed amount to $6,000,000 which is in line with the threshold for referral of public works to the Parliamentary Standing Committee on Public Works.
The statutory rule amends regulation 42A to provide that, for the purposes of section 79 of the Act, the prescribed higher amount is $6,000,000.
Overview
The Statutory Rule 1987 No 335, issued under the authority of the Minister for Transport and Communications, amends the Telecommunications Regulations 1993 to address a specific regulatory gap identified in the Telecommunications Act 1975. The Act originally provided a framework for telecommunications regulation and the Minister’s approval was required for contracts exceeding a specified amount. Regulation 42A previously set this amount at $2,000,000. The amendment to Regulation 42A, raising the threshold to $6,000,000, aligns with the threshold for referral of public works to the Parliamentary Standing Committee on Public Works, thereby ensuring consistency in regulatory standards and approval processes. This change aims to streamline the approval process for significant contracts within the telecommunications sector, facilitating more efficient governance and oversight by the relevant authorities.
Scope and Application
The statutory rule issued under the authority of the Minister for Transport and Communications modifies the existing regulatory framework established by the Telecommunications Act 1975, specifically targeting the financial threshold at which the Australian Telecommunications Commission must seek ministerial approval before entering into a contract. The rule applies to the Australian Telecommunications Commission, thereby influencing the financial decisions and contractual engagements of this entity. The scope of the rule is confined to the financial threshold for contract approval, ensuring that the entity adheres to the stipulated financial limits. The amendment raises the threshold for contract approval from $2,000,000 to $6,000,000, aligning it with the threshold for referral of public works to the Parliamentary Standing Committee on Public Works. The rule extends its application across the Commonwealth, as it pertains to a federal entity, the Australian Telecommunications Commission. No exclusions, exemptions, or additional thresholds are specified within the rule itself, though the broader legislative context may introduce other considerations. The rule operates within the constraints of the Telecommunications Act 1975, ensuring compliance with the overarching legislative intent.
Key Provisions
The key operative sections of this statutory rule are sections 112 and 79 of the Telecommunications Act 1975, and regulation 42A of the Telecommunications Regulations. Section 112 of the Act empowers the Governor-General to make regulations that are not inconsistent with the Act, and which are necessary or convenient for carrying out or giving effect to the Act. Section 79(1) of the Act stipulates that the Australian Telecommunications Commission must obtain the Minister’s approval before entering into a contract exceeding a certain amount, which is currently $2,000,000 as per regulation 42A. This statutory rule amends regulation 42A to increase the prescribed amount to $6,000,000, aligning it with the threshold for referral of public works to the Parliamentary Standing Committee on Public Works. This amendment ensures that the regulatory framework for contract approvals within the telecommunications sector remains consistent with broader public works standards.
The Act imposes specific obligations on the Australian Telecommunications Commission regarding contract approvals. Under section 79(1), the Commission must seek ministerial approval for any contract exceeding the prescribed amount. This approval process ensures that significant financial commitments are subject to higher-level scrutiny and authorisation. The amendment to regulation 42A, increasing the prescribed amount from $2,000,000 to $6,000,000, reflects a policy decision to align telecommunications contract thresholds with those used for public works. This alignment is intended to ensure consistency and coherence in the oversight of significant financial transactions across different sectors of government.
Breaches of the requirements under the Telecommunications Act 1975 can result in both civil and criminal consequences. Specifically, if the Australian Telecommunications Commission enters into a contract exceeding the prescribed amount without obtaining the requisite ministerial approval, it may be subject to penalties. While the statutory rule itself does not specify penalties, the Act generally provides for fines and other enforcement actions for non-compliance with its provisions. The precise penalties would depend on the nature and severity of the breach, but could include significant financial penalties or other sanctions. Additionally, individuals involved in authorising such contracts without proper approval could also face personal liability under relevant sections of the Act.