Polluters Win Out With Lax Regulation

As reported in New Matilda yesterday, Victoria's dirty industries are in mass breach of their EPA licence conditions. But an overhaul of the regulatory system, begun in 2011, is doing little to address the problem.

The overhaul currently underway was driven by two oversight failures. In 2009, the Victorian Ombudsman criticised the EPA’s handling of methane leaks at a Cranbourne landfill. In 2010, Victoria’s Auditor-General slammed its management of monitoring and compliance, and the handling and transport of hazardous waste.

Later that year, EPA chief executive John Merritt commissioned former Worksafe Victoria investigations director Stan Krpan for an internal review. Released early 2011, the report acknowledged the EPA’s efforts but said it lacked the “policies and procedures” necessary for effective regulation.

The report made 119 recommendations, 90 of which the EPA says it had completed by February this year.

But as part of the regulator’s reforms, Environmental Improvement Plans — which outline a company's environmental practices — have been made voluntary. While separate monitoring plans are required, they will not necessarily be approved or reviewed.

Environment Victoria has criticised what is sees as a continuing self-regulatory culture in Victoria’s fossil fuel industries.

“The monitoring is carried out by the companies, is paid for by the companies, and these consultants are chosen by the companies.”

“There’s a significant time lag between when the monitoring and reporting happens and any particular event or incident, which mean most of the scrutiny is actually happening within the company itself,” Campaigns Director Mark Wakeham told NM.

But the EPA, which declined repeated requests for an interview, said its risk-based system was consistent with best global practice, which translated to responding to issues that posed the most risk to communities and the environment.

EPA former Deputy Chair Robert Joy told New Matilda that the EPA lacked resources to handle all environmental monitoring, and that its system existed to advise companies in their own regulatory regimes.

“The monitoring program at the EPA taps into what is essentially [an]operating regime which the plants themselves need to operate in order to control their processes and their emissions,” he said.

Joy also said arguments about increasing environmental self-regulation were oversimplified, as large-scale air and water pollution had largely been tackled.

He also said contemporary environmental issues were unsuited to “licensing type regulation”.

“You’ve got to use other approaches in terms of educating people, spending capital on improved infrastructure, putting out better best practice guidelines, working with industry associations,” Joy said.

But Monash University environmental engineering and mining expert Dr Gavin Mudd told NM that environmental management has always been largely self-regulatory, and this merely became “more explicit” in recent times.

“In the 1990s it just moved to a more explicit sort of recognition and allowed companies a lot more freedom … It was the old argument about green tape, that companies felt they were being too tightly regulated,” he said.

Despite the EPA’s regulatory overhaul, Mudd sees this trend increasing.

“If you’re looking at the context federally, and what that means with all the different states… they’ve very much hoed into their public service and reduced a lot of the staffing for the science arms, into the regulatory arms and so on.

Former state Labor policy advisor Andrew Herington, who has a long-time interest in environmental policy, told NM that this shift was reflected in the loss of resourcing.

State environmental funding has dropped by $6.4 million over the past decade. The state budget also revealed an 8.7 per cent decrease in environmental protection activities for the newly created Department of Environment and Primary Industries, under which the EPA sits.

Herington said this has constrained the EPA’s staffing levels and ability to follow up on compliance and pollution. According to its annual report, EPA staff numbers were down by 13 per cent from 2011 to 2012.

But Mudd said effective environmental regulation also required greater transparency from companies.

“Companies need to be a lot more honest and transparent about what they’re monitoring, making sure their data’s available for communities, for researchers, for all to see,” he said.

The EPA needs to conduct more independent monitoring to ensure the accuracy of company data, added Mudd.

“If the company’s not monitoring properly and the government [EPA] is not checking that monitoring and either taking their own samples or things like that, then how do you know if the system’s working properly?” Mudd asked.

Annual Performance Statements (APS) for electricity and gas provider Energy Australia (formerly TRUenergy) and mineral producer and supplier UNIMIN were unavailable on the EPA’s website.

The EPA said licences not yet reformed under the licensing overhaul were not required to submit an APS.

This is the second of a two-part series by Georgina Moore on environmental breaches in Victoria. Read the first part here. This story was originally written as an assignment in the School of Journalism at Monash University.