The rule of bureaucrats

Who needs a constitution?  Who needs laws?  Who needs parliaments?

Not Australia apparently.  Australia has bureaucrats who know better.

On top of what is currently happening in the Democratic Republic of Victoria, we now apparently have administrative agencies with the power to amend legislation.

But first ….

This is a link to the text of the Australian Constitution.

After the introductory wiffle waffle, these are the words of section 1, the first bits:

The legislative power of the Commonwealth shall be vested in a Federal Parliament, which shall consist of the Queen, a Senate, and a House of Representatives, and which is hereinafter called The Parliament , or The Parliament of the Commonwealth .

Now TAFKAS is no lawyer or expert, but his reading of this suggest that the only organ with the power of legislation is the Parliament of the Commonwealth.

Right.  But get this latest announcement from ASIC which was issued in the last 15 minutes:

ASIC has modified the Corporations Act to prevent stub equity offers of scrip in a proprietary company being made to large numbers of retail target holders in takeover bids and schemes of arrangement.

Again, the policy issue at question is not relevant to this.  This is ASIC claiming to have changed legislating.

WHERE THE FLOCK is the Minister?  The Treasurer?  The Prime Minister?  The Attorney General?  The fricken fracken Governor General?

Does the Australian constitution mean anything anymore.  Clearly Section 92 does not but how about Section 1.  SECTION ONE!  The first damned words.

Come on Prime Minister.  Where the bloodly hell are we?

This entry was posted in Uncategorized. Bookmark the permalink.

33 Responses to The rule of bureaucrats

  1. Entropy

    The allure of technocracy for the bureaucrat is seductive for the power it gives them.
    It is seductive for the politicians as it absolves them of accountability.

  2. Nato

    It’s a great day for the Australian government. Citizens perhaps not so much.

  3. Des Deskperson

    I’m no lawyer, but my understanding is that this is a legislative instrument that can be made by an official under a power provided by the Corporations Act 2001.

    In other words, Parliament has agreed in the primary legislation that officials can make these sorts of secondary instruments. I haven’t looked at the Act, but these types of powers are usually quite specific and limited.

    There is no evidence that the Corporations Act itself has not been modified, and it couldn’t be without Parliamentary agreement. The wording of the ASIC announcement is misleading.

    These instruments are also usually required to be tabled in Parliament and can be disallowed by that body within a certain timeframe.

  4. Graham

    I think TAFKAS needs to do some reading about Henry VIII clauses in legislation. The concept has been around since 1539. It is currently in vogue in the UK because of the need to change legislation and statutory rules because of Brexit.

    Parliament can always by its own legislation delegate the power to change legislation by forms of secondary rules. That is what a Henry VIII clause means.

    Presumably ASIC’s power to modify the impact of legislation derives from such a provision in the Corporations Act itself.

  5. Hay Stockard

    Our Politicians are not world leaders in trashing a constitution. But they are up there.

  6. tombell

    ASIC has that power by virtue of an act of the Commonwealth parliament. That is to say, a bunch of time serving pollies gave a bunch of time serving bureaucrats the power to amend legislation by ASIC Instrument.( I guess it leaves more time for the pollies to manage their non-parliamentary affairs!) I have been on the receiving end of one of these. I was winning an argument with ASIC so they changed the law!!

  7. Scott Osmond

    I’ve said in meatspace that many of our institutions and organs of government have gone rogue and need to be shut down. I can see why the politicians won’t do anything, they are there for the status and perks and don’t want to be bothered with anything that might mean being held responsible for decisions. As for the departments, that power rush of telling people what to do must be intoxicating.

  8. mareeS

    I am no lawyer, but I have been a decent journalist. My former colleagues should be all over this.

  9. Dr Faustus

    I’m no lawyer, but my understanding is that this is a legislative instrument that can be made by an official under a power provided by the Corporations Act 2001.

    Your understanding is correct (not surprisingly).

    The Corporations Act provides ASIC with the power to amend or modify many of its provisions and make declarations. As Graham at 3:30 points out, this is nothing new, or unique.

    Everyday punters are, of course, fully protected from bureaucratic whim and excess. You just need to find a few $100,000, lawyer up, and take the fuckers model litigants to court.

  10. Pyrmonter

    Chapter 6 is a form of occupational licensure and a restriction on bad incumbent management. Why am I wrong?

    The UK takeovers model, with the Takeovers Panel etc, which we sought to follow when such things were first established in the late 60s/early 70s violated about every possible constitutional principle imaginable – informed, specialist tribunal of expert laymen, but not a court etc. But it was regarded as something that worked in practice, if not in theory, a bit like the House of Lords.

  11. Pingback: Cardboard guardians – Adam Piggott

  12. @Dr Faustus

    The Corporations Act provides ASIC with the power to amend or modify many of its provisions and make declarations. As Graham at 3:30 points out, this is nothing new, or unique.

    Again, not being a lawyer or expert, but a plain reading of section 1 suggests that the Parliament can’t delegate legislative powers. Unless of course the constitution is a meaningless document which is seems to be.

    Section 1 does not say:

    legislative power of the Commonwealth shall be vested in a Federal Parliament or its delegates.

  13. Pyrmonter

    (‘restriction on the removal of bad incumbent management’)

  14. Jock

    Come on lad! You have heard of delegated authority?

  15. Des Deskperson

    ‘Again, not being a lawyer or expert, but a plain reading of section 1 suggests that the Parliament can’t delegate legislative powers.’

    But almost every piece of federal legislation includes provisions that enable officials, almost always with Parliamentary oversight, to make secondary legislation – regulations, directions and other instruments – that can clarify or explain or enhance the legislative framework.

    It is always been my understanding that these must consistent with the overall purpose of the primary legislation.

  16. Mark

    I think it’s actually sloppy language rather than assumption of power. ie ASIC are modifying the regulations that they administer under the auspices of the corporations act.

    Whether they should have such blanket power is a different question.

  17. tombell

    17.8 The Australian Constitution does not expressly authorise the Commonwealth
    Parliament to delegate power to make laws, nor is it expressly prohibited. The High
    Court’s decisions in Baxter v Ah Way5
    and Roche v Kronheimer6
    are authority for
    Parliament’s power to delegate certain legislative powers to the executive. In Victorian
    Stevedoring and General Contracting Company v Dignan (‘Dignan’s case’), Dixon J
    said that Roche v Kronheimer decided that
    Again, not being a lawyer or expert, but a plain reading of section 1 suggests that the Parliament can’t delegate legislative powers. Unless of course the constitution is a meaningless document which is seems to be.

    from the Oz Law Reform Commission:-

    a statute conferring upon the Executive a power to legislate upon some matter
    contained within one of the subjects of the legislative power of the Parliament is a law
    with respect to that subject, and that the distribution of legislative, executive and
    judicial powers in the Constitution does not operate to restrain the power of the
    Parliament to make such a law.7
    17.9 Dixon J noted the ‘logical difficulties of defining the power of each organ of
    government, and the practical and political consequences of an inflexible application of
    their delimitation’.

  18. @Des Deskperson

    TAFKAS always appreciates your insights. However he would refer you to the words of ASIC, an organisation that is populated top to bottom with lawyers who know the difference between legislation, regulations, directions and other instruments:

    ASIC has modified the Corporations Act

    The Corporations Act not the Corporations Regs or directions or even their quasi legislative market integrity rules. The Corporations Act.

  19. tombell

    you’ll have to forgive previous post. formatting went wild!

  20. Behind Enemy Lines

    Desk Deskperson is correct. There are a number of areas where Parliament and the GG have concluded that the public interest requires faster-than-usual action on technical ‘rules’. I even have my name on one of them. It’s done under the enabling legislation, the Office of Parliamentary Counsel guards against any silly antics, and from memory these things are generally run past the relevant Minister as well.

    There’s plenty of mischief and wickedness done in government, but these sort of legislative instruments are well down the list of things to worry about.

    That said – very poorly drafted press release. ‘Changed the Act’ – oh my. Marketing and comms people always struggle with these sort of details, which is why smart agencies don’t let them release anything that hasn’t been signed off by the technical side.

  21. Des Deskperson

    ‘and from memory these things are generally run past the relevant Minister as well.’

    and also usually have to be tabled in Parliament, which has the power to disallow them

    ‘The Corporations Act not the Corporations Regs or directions or even their quasi legislative market integrity rules. The Corporations Act.’

    I have checked the recent amendments to the Companies Act 2001.

    The latest was 23 July 2020,and involved a follow-on technical amendment as a result of changes to the Treasury laws. Nothing to do with the current issues.

    Only Parliament can amend a law.

  22. Dr Faustus

    Again, not being a lawyer or expert, but a plain reading of section 1 suggests that the Parliament can’t delegate legislative powers.

    Nevertheless, the Corporations Act expressly provides for ASIC to modify the provisions of the legislation, as well as the regulations.

  23. Behind Enemy Lines

    Dr Faustus
    #3596250, posted on September 24, 2020 at 5:21 pm
    Again, not being a lawyer or expert, but a plain reading of section 1 suggests that the Parliament can’t delegate legislative powers.

    Nevertheless, the Corporations Act expressly provides for ASIC to modify the provisions of the legislation, as well as the regulations.

    No, Faustus, it doesn’t, although I can understand why it appears so.

    The section you’ve cited does give (revocable) power to ASIC, but not the power to modify the legislation. Para 673(1)(b) enables ASIC to exercise its judgement as to whether it should act ‘as if’ the specified provisions (and only the specified provisions) were modified. The Act also gives guidance and provides constraints about how ASIC must exercise that judgement.

    Legislative interpretation can be a pig of a thing, so I’m not pointing a finger at you or anyone else. Likewise, I’m not arguing to be petty, but to point out that the public service is not overriding Parliament. That’s an important issue.

    These things have actually improved. In Olden Days I understand that legislative instruments were more powerful, less transparent, largely undocumented on any public register and much more common.

    Which is not to say we don’t have lots to complain about. 😉

  24. Dr Faustus

    The section you’ve cited does give (revocable) power to ASIC, but not the power to modify the legislation.

    BEL: On careful reading of my comment, you will see I state that the Act gives ASIC the power to modify the provisions of the legislation – not the legislation itself.

    When you read ASICs modification instrument you see that it is relying on s655 – which has the same wording regarding modification of provisions as the later section I linked to (this same clause is repeated elsewhere).

    Clearly Parliament intended ASIC to have these powers, and this is not some bureaucratic frolic. Which was my original point.

  25. Behind Enemy Lines

    Faustus, to modify the provisions would be to modify the legislation. Parliament does not grant ASIC the power to modify the provisions. What Parliament allows under the Act is for ASIC to decide whether a party should be treated as if the provisions had been modified (or omitted, etc.). Exactly why, I don’t know. But the key point is that in all of this the Parliament (though the legislation) is instructing ASIC, not the other way ’round.

  26. Nicholas (Unlicensed Joker) Gray

    Perhaps Victoria should have a name change- Victimia, anyone?

  27. Dr Faustus

    What Parliament allows under the Act is for ASIC to decide whether a party should be treated as if the provisions had been modified (or omitted, etc.)

    Declaring goes a little further than just deciding, but yes, you are correct, ‘as if’.
    I’d be interested if you think there is a materially different practical effect.

  28. Behind Enemy Lines

    Faustus, since you ask, I think at the point of specific action there’s little meaningful difference. That’s the intent of the Act. “Here’s the law, ASIC’s got the lead, deal with it.” For people affected by the delegation, the main difference is that they would probably have additional avenues to challenge the decision. But in terms of legislation and the legislative process, this approach does reserve power to Parliament, which is materially different from how TAFKAS saw it. That’s important. No matter how rubbish Parliament may be, they’re all temporary and replaceable by voters, whereas a permanent quasi-sovereign public service Administrative State is downright evil.

    (I hope I’ve not turned this into a boring and unwelcome lecture.)

  29. Dr Faustus

    BEL: I don’t think we are in disagreement.

  30. nb

    Hillsdale College: ‘William P. Barr | The Constitution and the Rule of Law’

  31. Rafiki

    Tombell has stated the orthodox position. There may however be room for a qualification that would invalidate a statutory grant of power to a statutory body that is not responsible to a Minister. Drawing on analysis by Dixon and Evatt JJ in Dignan’s case, it might be argued that when Parliament makes such a grant of power, it is making a law which creates a legislative body outside the structure of responsible government, which it is something the Constitution does not empower it to do. Such an argument would be built on the fact that the Constitution establishes responsible government as a fundamental element. There is no incompatibility when a statute empowers a Minister to make a subsidiary law, but there is when the repository of the power stands outside the structure of responsible government.

  32. Cynic of Ayr

    Politicians of all persuasions gave away their responsibilities to the Bureaucrats.
    The reason was so they could distance themselves from the responsibility of decisions. The Bureaucrats accepted this, as long as they were fully protected – and they were. No Bureaucrat who makes a bad decision is penalised in any way.
    The reason for the shift of responsibility is that Politicians now see representation as a rather cushy career, not as something to do for a while for the good of the Country.
    Re-election is now the Prime. Driving. Force!
    I am starting to lean heavily in favor of limited terms, but how that would be accomplished I have no idea!

Comments are closed.