Mr Richard Bolt
Secretary
Department Economic Development, Jobs, Transport and Resources
Level 12, 1 Spring Street
MELBOURNE VIC 3000
Ref: BMIN16002594R
Mr Richard Bolt
Secretary
Department Economic Development, Jobs, Transport and Resources
Level 12, 1 Spring Street
MELBOURNE VIC 3000
Dear Mr Bolt
2016-17 STATEMENT OF EXPECTATIONS FOR EARTH RESOURCES REGULATION
I am writing to provide you with my Statement of Expectations for Earth Resources Regulation. This Statement applies for the period 1 July 2016 to 30 June 2017, or until otherwise amended, and replaces all previous Statements.
Purpose
This Statement sets out my expectations of Earth Resources Regulation to continue its program of reform, as addressed by the previous Statement of Expectations, to improve regulatory practice. It outlines key governance performance objectives that aim to promote greater efficiency and effectiveness in the administration and enforcement of regulation. This will reduce the regulatory cost impact on businesses, and improve community confidence in EarthResources Regulation.
As Minister for Resources, I am responsible for administering the following legislation and associated regulations that affect businesses and the broader Victorian community:
- Mineral Resources (Sustainable Development) Act 1990
- Offshore Petroleum and Greenhouse Gas Storage Act 2010
- Petroleum Act 1998
- Geothermal Energy Resources Act 2005
- Greenhouse Gas Geological Sequestration Act 2008
- Underseas Mineral Resources Act 1963.
This statement should be read within the context of the objectives, obligations and functions outlined in these Acts as amended.
Objective
The government is committed to improving the wellbeing and prosperity of all Victorians. Achieving this outcome requires action from all parts of government, working in partnership with industries and communities to grow the economy and create meaningful jobs, while reducing disadvantage and barriers to work.
Equally, the government is focused on safeguarding the health and wellbeing of local communities, and ensuring that they are not subject to unnecessary or avoidable environmental and public risks.
Victoria’s earth resources sector can play an important part in delivering new jobs and opportunities to Victorians, particularly in our regional areas. The Department should continue to develop an approach that will support jobs growth in the minerals and extractive resources sectors while improving public confidence in the operation of those industries. This includes testing how rights are allocated for mineral exploration through the pilot project in the Stavely geological province and reforming Environment Review Committees, as well as examining options such as a community advocate and community interest areas.
A strong regulator is critical to realising the benefits this sector generates for Victorian communities, while ensuring that resource projects are sustainable and operate in a way that does not pose environmental or public health risks.
Earth Resources Regulation has recently implemented significant reforms to improve regulatory performance, and increase community confidence and investor certainty. It is my intention to continue this momentum over the next 12 months.
These reforms will only deliver long-term benefits to industry and the community if they are implemented effectively, refined, reported against and regularly reviewed and updated in response to changing circumstances.
This Statement of Expectations identifies the key areas of governance and operational performance where there are further opportunities for Earth Resources Regulation to improve regulatory practice.
Improvements and targets
1)Collaboration and coordination with co-regulators
In 2015-16, Earth Resources Regulation clarified the roles of the earth resources regulators, including through updating inter-agency Memoranda of Understanding and partnership agreements. It is important that Earth Resources Regulation continues to collaborate with the various regulators involved in the earth resources sector, to deliver on its regulatory obligations consistent with good regulatory practice.
In 2016-17 I expect Earth Resources Regulation to:
a)Drive on-the-ground implementation of the various Memoranda of Understanding and partnership agreements that apply to its relationships with co-regulators, and to review these arrangements by June 2017.
b)Demonstrate a coordinated, effective and strategic approach to regulation across the sector, by engaging with co-regulators through inter-agency forums, and increasing engagement on regulatory matters.
2)Embedding a risk-based approach to regulation
Regulatory outcomes can be improved by using a risk-based approach that focuses activities to areas of greatest risk, and applies a response that corresponds to the identified risks. For this reason, Earth Resources Regulation recently introduced measures to adopt a riskbased approach to managing regulatory responsibilities, including incorporating risk-based conditions into earth resource licences.
Throughout 2016-17 I expect Earth Resources Regulation to:
a)Put the riskbased approach to managing its regulatory responsibilities into practice, to ensure measured, timely, proportionate, consistent and justifiable decisionmaking.
b)Fully embed the enterprise risk management framework in accordance with its 201617 Risk Management Strategy and Plan. I expect this to be demonstrated through establishing a technical expert panel by December 2016 that can be drawn upon to identify and manage risks, and supporting resource businesses in transitioning to risk-based work plans.
c)Ensure the Mine Fire & Emergency Unit has integrated systems and processes to regulate compliance with Acts and regulations to manage mine fire risk by June 2017, in consultation with co-regulators and mine operators.
3)More consistent, accountable and transparent regulatory practices
Improving community confidence and investor certainty requires an accountable and transparent regulator, that provides accurate and accessible information to stakeholders.
In 2015-16 Earth Resources Regulation drove clearer and more consistent regulatory practice through developing a new Compliance Strategy, annual compliance plan and key performance indicators. In 2015-16 Earth Resources Regulation also:
- Drove an improved quality of service and set clearer expectations for industry and communities, including through developing a new client service standard and an improved complaints management system.
- Built workforce capability, culture and governance arrangements, such as through implementing a capability strategy, and establishing a Mine Fire & Emergency Unit.
Earth Resources Regulation must continue to embed the systems and practices of a contemporary regulator, in line with recent reforms and consistent with the recommendations of the 2012 Victorian Auditor-General’s Office’s Audit Effectiveness of Compliance Activities: Departments of Primary Industries and Sustainability and Environment (2012). This is essential if Earth Resources Regulation is to continue to build community confidence and industry certainty through improved regulatory performance.
This must deliver a high quality of service to industry and the community. It is important that Earth Resources Regulation staff interacts with the public in a consistent and transparent way, and in accordance with the Department’s compliance principles:
- Helpful
- Respectful
- Impartial
- Proportionate
- Predictable
- Transparent.
In 2016-17 I also expect Earth Resources Regulation to:
a)Implement clear, consistent and transparent operational processes on-the-ground. This should include a demonstrated compliance with Earth Resources Regulation’s transparency guideline, and actively managing complaints from industry or the community.
b)Commence reporting against its client service standard, key performance indicators and annual compliance strategy from September 2016.
c)Deliver a public summary of its reporting architecture that identifies the range of reporting activities undertaken by Earth Resources Regulation, by December 2016.
d)Review its approach to compliance and performance reporting in light of changing priorities and circumstances.
e)Update its key performance indicators and publish a new three year compliance strategy by June 2017.
4)Effective, structured and proactive community engagement
In 2015-16 Earth Resources Regulation published a new Stakeholder Engagement Strategy that sought to drive effective, structured and proactive community engagement. It is important this is rolled out through the system to realise the benefits of improved community trust and faith in the regulator’s operations.
In 2016-17 I expect Earth Resources Regulation to:
a)Develop an implementation timeline for the 25 actions identified in the Stakeholder Engagement Strategy by December 2016, and to commence annual reporting on progress on implementing the Strategy by June2017.
b)Facilitate improvements to interactions between local communities and industry, including by developing a framework for assessing and monitoring the resource sector’s engagement with local communities, to be completed by June 2017.
c)Actively engage stakeholders to assess their views on Earth Resources Regulation’s standard of service, with the aim of observing improvements in customer satisfaction in Earth Resources Regulation across financial year 2017-18.
5)Reducing regulatory burdens on small business
The government recognises that the regulatory burden can fall disproportionately on small businesses, compared to larger businesses. Alleviating regulatory burdens on small businesses creates opportunities for investment and jobs into the earth resources sector.
In 2016-17 I expect Earth Resources Regulation to:
a)Identify, by June 2017, options to reduce regulatory burdens on small businesses, and enhance small businesses’ understanding of, and compliance with, legislation and regulations.
As part of this work I expect Earth Resources Regulation to identify options for streamlining regulatory reporting processes as well as considering options for tailored and direct engagement with small businesses.
6)Timeliness of responses
Timeliness is an important component of good regulatory practice. In 2015-16 Earth Resources Regulation took steps to improve timeliness through developing a client service standard that sets out statutory timeframes for decision making.
In 2016-17 I expect Earth Resources Regulation to:
a)Meet its statutory timeframes for decision-making, with the aim of reducing time taken to deliver key decisions in financial year 2017-18.
b)Improve the availability of online services and simplify processes, where possible, to reduce regulatory burden for individuals and businesses to complete forms and applications and streamline collecting and processing information. The improvements arising should be reported in the Department’s Annual Report.
c)Clearly communicate timelines for its processes to individuals and businesses, to reduce uncertainty and avoid duplication, and align these timelines with other regulators where appropriate.
d)Provide live, online reporting of the progress of regulatory applications, including showing timeliness of referral authorities as well as Earth Resources Regulation itself.
In implementing these improvements and targets, I expect Earth Resources Regulation to consult with business and the broader community.
Reporting
I expect that you will respond to this Statement, describing how Earth Resources Regulation intends to achieve the performance improvements outlined above.
Reporting on Earth Resources Regulation’s progress in achieving performance targets should be undertaken in the context of Departmental annual reporting to avoid dual reporting streams.
As a part of annual reporting, regulators are expected to report on:
a)Performance against the improvements and targets set in this statement.
b)Activities undertaken to reach the targets and improvements set out in this statement.
I also expect that this Statement of Expectations will be published on the Earth Resources Regulation’s website, alongside your response.
I look forward to seeing Earth Resources Regulation continuously working towards achieving best practice in the administration and enforcement of regulation.
Yours sincerely
Hon Wade Noonan MP
Minister for Industry and Employment
Minister for Resources
Date: / / 2016