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Did you know the Melbourne Strategic Assessment legislation is now live?

July 08, 2020

The Act gives effect to the implementation of agreements which have operated since 2010 between the Victorian and Federal Governments, as set out in the MSA Report and associated approval conditions, in accordance with the Environment Protection and Biodiversity Conservation Act (EPBC Act).

A number of key components imposed within the Act include:

  • Only relevant for land to which the MSA and Biodiversity Conservation Strategy (BCS) apply
  • The environment mitigation levy replaces the BSC Habitat Compensation fee
  • The environment mitigation levy will be indexed annually
  • Indexation is calculated according to weighted balance of consumer price index and wage price index
  • The average adjustment in the five years to 2019 has been 1.7 %; and The first five years incudes an additional indexation to account for prices not increasing since 2013, following that 5 period only CPI and wage price index apply
  • Establishes the Melbourne Strategic Assessment Fund and specifies the purposes for which the fund may be used
  • Requires a 5 yearly review of the cost base of the program and that the review be a public process with an opportunity for industry to provide information of make submissions
  • Includes a biannual audit of the progress of the Program against the existing agreed outcomes to be completed by the Commissioner for Environmental Sustainability
  • Annual reporting requirements including availability of information on the DELWP website

The liability to pay an MSA levy is triggered when a levy event occurs within the levy areas. The levy events prescribed within the Act are as follows:

  • Issue of a Statement of Compliance for a plan of subdivision (i.e. subdivision of land)
  • Application for a building permit
  • Approval of a work plan or variation of a work plan under the Mineral Resources (Sustainable Development) Act 1990
  • Construction of utility infrastructure on Crown land
  • Construction of a road on Crown Land

HIA was only made aware of Melbourne Strategic Assessment (Environment Mitigation Levy) Bill 2019 just prior to it being introduced into Parliament in mid-October 2019. When the Bill was first introduced, HIA met with DELWP’s senior officers and the Minister’s and Premier’s Officer to discuss the matter further. HIA raised a number of concerns, including the lack of adequate industry consultation surrounding the levy system, including the amount of the levy, particularly in the first 5 years. As raised previously, the first five years incudes an additional indexation to account for prices not increasing since 2013. This essentially means the levy is higher in the initial stages almost as a catch up measure. Following that 5 year period, only CPI and a wage price index apply. Concerns were also raised that there are no rights of review of the levy amount to VCAT. The only VCAT review rights are around the process in which it is applied to land.

Read more on the requirements of the Act

If you wish to discuss this matter further, please contact Teresa Davis on t.davis@hia.com.au or 03 9280 8230