The public debate regarding the proposed personal property securities reform currently being considered by the Commonwealth Government proves the truth of the saying that "you can't please all of the people all the time". In fact, based on the submissions made to the second Senate Legal and Constitutional Affairs Committee inquiry regarding the Personal Property Securities Bill (PPS Bill) introduced to the House of Representatives in June 2009, you could say, at least in the case of the PPS Bill, that you cannot please any of the people, any of the time. Given the wide range of views presented to the inquiry it is perhaps unsurprising that the Committee did not make definitive recommendations for amendments to the PPS Bill, as discussed below.
An exposure draft of the PPS Bill was referred to the Senate Legal and Constitutional Affairs Committee in November 2008. The Committee tabled its report on that exposure draft in March 2009. There was then no response from the Commonwealth Government until mid June 2009. A formal response from the Commonwealth Government to the report was issued on 18 June 2009. Immediately prior to that time, New South Wales was the first State to pass referral legislation on 17 June 2009. The revised PPS Bill was tabled in the NSW Legislative Assembly for the purposes of that referral. On 24 June 2009 the revised PPS Bill was introduced to the Commonwealth House of Representatives. The PPS Bill was then referred, for the second time, to the Committee.
The revised PPS Bill, as tabled in New South Wales and introduced in the House of Representatives, was substantially amended from the earlier exposure draft of the PPS Bill previously considered by the Committee. This had been done to address the recommendations in the earlier Committee report. Many of the amendments were quite superficial, such as the re-ordering of significant parts of the Bill to attempt to have "more important" provisions at the front of the Bill and the introduction of summary sections. A number of changes were however quite significant, such as the introduction of a conflicts of law regime and the changes to deal with privacy issues.
Following receipt of written submissions and public hearings on 6 and 7 August 2009, the Committee tabled its report on 20 August 2009. The majority report recommended that the PPS Bill should be supported and passed. This was on the basis of 3 conditions:
1. until 30 September 2009, the Commonwealth Government consults with stakeholders in relation to concerns that have been raised with the Committee and also in relation to other concerns that have been raised with the Commonwealth Government since the revised PPS Bill became publicly available;
2. greater transparency is provided regarding the Commonwealth Government's response to concerns that are raised and the reasons for particular policy decisions as reflected in the PPS Bill; and
3. a consequential amendments bill is debated in the Senate at the same time that the PPS Bill is debated following the further consultation period.
As in the case of the initial inquiry, although most submissions generally supported the reform, a wide range of significantly different views were expressed. The Committee was concerned whether these wide ranging views reflected fundamental policy differences or, instead, concerns regarding whether the PPS Bill, as drafted, operates as it is intended to. Ultimately, the Committee concluded that the issues raised reflected both types of concerns.
Given the number of concerns raised, the Committee's first condition is aimed primarily at ensuring these concerns are addressed, to the extent practicable, in a way that enables the timetable for commencement of the new regime to be met. The Committee's condition regarding transparency in decision making is intended at least in part to ensure that an attempt is made to explain the policy choices of the Commonwealth Government and possibly persuade those who are unconvinced by the merits of the PPS Bill, or particular provisions of it, to change their minds.
Unfortunately, the recommendations do not provide a great deal of guidance to the Commonwealth Government as to what amendments should be made to the PPS Bill following the consultation process. Chapter 5 of the report lists in detail a number of "technical" issues to be addressed by the Attorney-General's Department, indicating that the Committee believes the focus of the next month of consultation (and the amendment legislation that is proposed) should be on these technical issues, rather than broader policy concerns that have been raised.
The Committee did not recommend an extension to the implementation date for the new PPS regime, though was concerned with timing. It is not clear why the Attorney-General took so long to respond to the Committee's initial report and why a decision was made to commence the State legislative referral process, and introduce the PPS Bill to the House of Representatives, without making the revised PPS Bill publicly available or undertaking any public stakeholder consultation. If the revised PPS Bill had been made publicly available at an earlier point in time, and stakeholders invited to provide input, perhaps the Commonwealth Government would not now be in the awkward position of having to introduce and pass amendment legislation to the PPS Bill at the same time that the PPS Bill itself is passed.
Although the additional time for public consultation recommended by the Committee is commendable, it does prolong the uncertainty associated with the introduction of the new regime. Until the consultation process is finished at the end of the September 2009 and the proposed amendment legislation is made available there remains uncertainty as to the final terms of the legislation. This is compounded by the fact that the PPS regulations and the amendments to other Commonwealth legislation, such as the Corporations Act and the Shipping Act, are also not available. Therefore, although those affected by the regime can start planning for its introduction in May 2011, consideration will need to be given to the further amendments, the regulations and the ancillary changes to other legislation as and when these become available.
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