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Melbourne Strategic Assessment Bill - Passed through the Upper House

February 12, 2020

On the 16th of October 2019, the Victorian Government introduced the Melbourne Strategic Assessment (Environment Mitigation Levy) Bill 2019 (the Bill) to the Victorian Parliament. The Bill was passed through the Upper House of the Victorian Parliament on Thursday 6th of February and will come into effect on 1 July 2020.

The Bill underpins the existing Melbourne Strategic Assessment Program in acknowledgement of the long time scale of the program and to codify and improve a number of the processes currently in place. The Bill gives effect to the implementation of agreements between the Victorian and Federal Governments, as set out in the Melbourne Strategic Assessment (MSA) Report and associated approval conditions, in accordance with the Environment Protection and Biodiversity Conservation Act (EPBC Act). A number of key components proposed within the Bill include:

  • Only relevant for land to which the MSA and Biodiversity Conservation Strategy (BCS) apply
  • The environment mitigation levy will replace 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%
  • 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
  • To establish 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.
HIA was only made aware of the Bill just prior to it being introduced into Parliament in mid-October 2019. Since the Bill was first introduced, HIA has 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. 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 there are also 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.

The Victorian Government has advised that assistance will be provided to industry so that to adequately prepare for the introduction of the Bill on 1 July 2020.

If you require any further information, please email Teresa Davis or call 03 9280 8230.