10.1.2 What is the distinction between primary and delegated legislation?
10.1.3 What should be included only in primary legislation?
10.1.4 What may be included in delegated legislation?
10.1.5 What may be included in either primary or delegated legislation?
10.1.6 What considerations do not justify the use of delegated legislation?
10.1.7 Does the legislation contain clear limits on the delegation?
10.1.8 Henry VIII clauses
10.1.9 Commencement orders
Under section 15(1) of the Constitution Act 1986, Parliament has full power to make laws. Parliament usually exercises this power to pass primary legislation (that is, Acts of Parliament). However, Parliament also has the power to confer its law-making power on another person or body, thus enabling that person or body to make laws. This process is the delegation of Parliament’s legislative power, and the resulting laws are known as delegated legislation.
Delegated legislation is a generic term, which includes regulations (as defined in section 29 of the Interpretation Act 1999 and section 2 of the Regulations (Disallowance) Act 1989), deemed regulations (see Part 4 of this chapter), and other delegated legislation (such as Ministerial notices). Delegated legislation is also known as subordinate legislation: that is, the legislation is subordinate to the Act under which it is made. Terms such as “secondary legislation”, “regulations”, “deemed regulations”, and “tertiary legislation” are sometimes used to describe delegated legislation or aspects of delegated legislation. However, to avoid confusion, it is preferable to think of delegated legislation as encompassing all legislation made under the authority of an Act of Parliament. It is important to note, however, that regulations (as defined); is a narrower concept than delegated legislation, because of the limited scope of that definition.
The reasons why Parliament delegates its law-making powers have been summarised as follows:
There is little doubt that regulations are a necessary part of New Zealand's legal landscape. This has long been the case. It is a simple reflection of the complexity of living in a civilised society and the necessity for so much law containing high levels of technical detail. It would be impossible for Parliament to retain absolute responsibility for all of it.
So, in recognising the practical utility and, in many cases, the necessity for delegated legislation, Parliament routinely delegates its law-making function. However, Parliament must be satisfied that, in each case, the delegation can be objectively justified. Further, there must be sufficient safeguards and constraints to satisfy Parliament that the delegated power will be exercised properly and will not be abused. In particular, the Regulations Review Committee may draw a regulation to the attention of the House on one or more of the grounds specified in standing order 315(2) (see Chapter 10A, Part 6).
The courts also have a role in reviewing delegated powers made under the authority of Parliament (see Chapter 10A, Parts 1 to 5). However, the courts will only become involved in a review if the validity of delegated legislation is challenged in the court.
In all cases, it is vitally important to ensure that—
• the anticipated scope of the empowering provision has been carefully considered.
• the empowering provision clearly specifies the limits of the delegated power.
• the delegated legislation falls within the scope of the empowering provision.
The delegation of an indeterminate legislative power will never be justified, because Parliament delegates, rather than surrenders, its legislative power.
The following issues are discussed in this chapter:
Part 1: Is delegation of legislative power appropriate and does the empowering provision contain clear limits on the delegation?
Part 2: What procedures should be specified to control the process of making the delegated legislation?
Part 3: To whom should the delegation be made?
Part 4: Is a provision for "deemed regulations" appropriate?
Part 5: Is a provision for a "subdelegation" appropriate?
Part 6: Is the use of "incorporation by reference" appropriate?
Part 7: If the legislation includes a power to give policy directions, has the appropriate process been followed?
Chapter 10A concerns the exercise of delegated legislative power and deals with the circumstances in which delegated legislation can be found to be invalid.
IS DELEGATION OF LEGISLATIVE POWER APPROPRIATE AND DOES THE EMPOWERING PROVISION CONTAIN CLEAR LIMITS ON THE DELGATION?
This Part answers the following questions—
- what is the distinction between primary and delegated legislation?
- what should be included only in primary legislation?
- what may be included in delegated legislation?
- what may be included in either primary or delegated legislation?
- what considerations do not justify the use of delegated legislation?
- does the legislation contain clear limits on the delegation?
The distinction between primary legislation and delegated legislation is often regarded as the division between principle and detail, or between policy and its implementation. On that analysis, matters of principle and policy are usually found in primary legislation, while detail and implementation are ordinarily the domain of delegated legislation. This is because the politicised Parliamentary process surrounding the passage of primary legislation, and the public participation in that process, is the appropriate forum for the principle and policy of a legislative scheme to be debated and resolved.
Parliament itself recognises that some matters should be included in primary, rather than delegated, legislation. Standing order 315(2)(f) provides that the Regulations Review Committee may draw a regulation[103a] to the special attention of the House if the regulation “contains matter more appropriate for parliamentary enactment”.[103b]
However, the distinction between principle and detail and policy and implementation can be both confusing and circular, not least because there is a significant overlap between those general descriptions. For example, Acts sometimes contain matters of detail and, conversely, delegated legislation may contain matters of principle. Also, the concept of “policy” has a number of facets, ranging from high-level policy (for example, setting out a basic rule at a high level of generality: a matter that would usually be found in an Act) to matters of low-level policy (for example, specifying what items should be included in a form: a matter more appropriate for inclusion in delegated legislation).
An example of high-level policy is the bare prohibition on unsafe motor vehicles being operated on the roads (see section 6(1) of the Land Transport Act 1998). The low-level policy, setting out the various motor vehicle safety standards that apply to that prohibition, is found in the Land Transport Rules (see, for example, Land Transport Rule 32005: Vehicle Lighting 2004, which specifies the safety requirements for vehicle lighting).
Clarifying the true nature of the policy will give useful guidance as to whether it is policy that should be included in an Act or in delegated legislation. For example, is the policy something that would give rise to widespread public interest? If so, then serious consideration should be given to including that matter in an Act. Conversely, if the policy is of a purely administrative, technical, or non-controversial nature, it may well be a matter that could properly be dealt with in delegated legislation.
In deciding whether a matter is likely to be controversial, it may be helpful to consider what the likely public and political reaction to the matter would be if it were publicised in the news media.
There are a number of matters that should ordinarily be included only in primary legislation and should rarely, if ever, be included in delegated legislation. Only if there are objectively justifiable reasons should any of the following matters be included in delegated legislation. It will be very rare to find such reasons.
- matters of significant policy should be included in an Act. Although “significance” will vary from case to case, a policy will likely be significant if it has the potential to give rise to controversy (whether political or otherwise). However, it should be noted that a matter that does not appear to be significant when the legislative scheme is being developed may well become significant over time (and vice versa): that factor should be carefully considered, as it may affect the decision as to whether it is placed in primary or delegated legislation.
- provisions which affect fundamental human rights and freedoms should always be included in primary legislation. Examples of these rights and freedoms include—
- freedom from search and seizure.
- the right to demand and receive information.
- rights under the New Zealand Bill of Rights Act 1990 generally.
- provisions which expropriate property (namely, the taking of property for public use).
- social and economic rights (which include welfare and ACC rights and the corresponding rates of entitlement).
- rights of appeal from decisions of courts and other tribunals should be established and controlled by primary legislation (see, for example, Part 3 of the Residential Tenancies Act 1986, which establishes and controls the Tenancy Tribunal). However, some appeal provisions are contained in both primary and delegated legislation. See, for example, sections 304 and 305 of the Education Act 1989 (which establish the Student Allowance Appeal Authority and give a right of appeal in relation to student allowances) and Part 6 of the Student Allowance Regulations 1998 (which deals with the process of the appeals, including the lodging of appeals, the evidence that the Authority may receive, and matters that the Authority must have regard to in determining the appeal).
- provisions that vary the common law should be included in primary legislation. In particular, any abrogation of a common law right (that is, a right that is to be entirely taken away, or replaced, by legislation) should be implemented only by primary legislation. An example of primary legislation abrogating common law rights is section 317(1) of the Injury Prevention, Rehabilitation, and Compensation Act 2001 (which prevents a person from bringing proceedings for damages arising out of a personal injury covered under the 2001 Act or any former ACC Act).
- offences of a serious nature and significant penalties (criminal and civil) should be included in primary legislation. Penalties imposed under delegated legislation should not include sentences of imprisonment. Fines that are imposed under delegated legislation should be limited by the empowering Act, and should ordinarily be low. However, the concept of proportionality may be appropriate, for example, where a penalty is calculated as a multiplication of the economic gain received from the offending concerned. Larger levels of fine in delegated legislation may be justified if the offender is a corporation, rather than an individual. Forfeiture of property should be authorised only by primary legislation (see, for example, the confiscation of motor vehicles under sections 128 and 129 of the Sentencing Act 2002). Infringement offences and fines may be imposed by delegated legislation, but the infringement regime itself (including the maximum level of fines) should be specified in primary legislation.
- taxes should only be levied by or under primary legislation. This is a well-settled principle, currently stated in section 22(a) of the Constitution Act 1986. This limitation also applies to the borrowing of money and the expenditure of public money (section 22(b) and (c) of that Act). However, although some “taxes” are routinely imposed under delegated legislation, those taxes must be clearly authorised and closely controlled by primary legislation (see, for example, commodity levies imposed by commodity levies orders made under Part 1 of the Commodity Levies Act 1990).
- new agencies and offices should ordinarily be established by primary legislation. However, some bodies with limited powers and functions may justify establishment by delegated legislation (see, for example, Deer Industry New Zealand, a body to represent the interests of those operating in the New Zealand deer industry, which was established under regulation 4 of the Deer Industry New Zealand Regulations 2004).
- an Act will normally be amended only by another Act. However, there may be situations in which amendment by delegated legislation is justified (see para 10.1.7, Henry VIII clauses).
- retrospective changes should not be made by delegated legislation. This reflects the general rule against retrospective legislation (see section 7 of the Interpretation Act 1999).
It is important to ensure that the purpose of a legislative scheme is not undermined by a failure to be able to implement it, either immediately after the Act becomes law, or at any later time. In developing primary legislation, serious consideration should be given to the need for, and scope of, delegated legislation.
Any delegated law-making power should, therefore, be developed in tandem with the primary legislation, to ensure that the scheme can be implemented fully: there should be no excuse for an inability to implement a legislative scheme simply because of a defective or inadequate power of delegation.
Accordingly, the scope of legislative delegation provisions vary enormously. For example, section 140 of the Coroners Act 2006 is a limited power, permitting regulations to deal with matters such as prescribing fees, allowances, and witness expenses. Conversely, sections 172D to 172K of the Electricity Act 1992 enable regulation of an extensive range of matters relating to electricity governance, including powers to establish wholesale markets and to regulate generation, transmission, and distribution and retail of electricity. In some cases no delegation of the law-making power is considered necessary (see, for example, the Consumer Guarantees Act 1993).
- Traditionally, the following matters have been relied on as justifications for Parliament to delegate its law-making powers: pressure on Parliamentary time.
- technicality of the subject matter.
- unforeseen contingencies.
- need for flexibility.
- opportunity for experimentation.
- emergency conditions requiring speedy or instant action.
These grounds were first identified in a 1932 United Kingdom report on delegated legislation,[103c] and subsequently approved in a 1962 New Zealand report.[103d] The grounds remain largely valid today, and are considered in more detail in the following paragraphs.[103e]
Pressure on Parliamentary time
Parliamentary time is at a premium, and Parliament will be very reluctant to waste valuable time considering matters that could be efficiently dealt with in delegated legislation. Consequently, consideration should be given to placing less significant matters in delegated legislation.
Examples of matters that Parliament would not ordinarily wish to spend its time on (and which may therefore be included in delegated legislation) include—
- the mechanics of implementing an element of the Act.
- specifying fees and the methods for calculating fees.
- setting out the format and content of forms.
- providing details of procedures necessary to fulfill a requirement in the Act.
- large lists (for example, alteration of the Tariff: see section 9 of the Tariff Act 1988).
- matters that are subject to indexation (for example, indexation of rates of excise duty: see section 79 of the Customs and Excise Act 1996).
In short, the greater the number of lower order matters (the matters of detail or implementation) that can legitimately be included in delegated legislation, the greater amount of time Parliament will have to deal with the high level matters (the matters of principle and policy) of the legislative scheme.
Technicality of the subject matter
Many modern legislative schemes require the inclusion of a high degree of technical material to enable the scheme to function satisfactorily. Examples include ACC, biosecurity, customs, fisheries, and securities legislation.
While it would be possible to include such matters in primary legislation, to do so would make the content of the Bill so complex that it would be impossible for Parliament to debate it in any worthwhile manner. The total time Parliament would need to dedicate to the Bill would also be greatly increased. If Parliament were to concern itself with matters of both broad policy and minor detail, it would result in statutes becoming “cluttered, unreadable, and possibly less effective”. The end result may be that users of legislation would be less able to access and understand the law.
In short, inclusion of a great number of technical or complex matters in a Bill would likely lead to Parliament becoming swamped in a mire of minutiae.
If the legislative material in question can be categorised as technical or complex, then serious consideration should be given to including the material in delegated legislation. Similarly, if the amount of material is extensive, then it may well be appropriate to include it in delegated legislation.
However, if the material is likely to be politically contentious, that may indicate that, despite the technicality, complexity, or amount, consideration should be given to including it (or the contentious parts of it) in primary legislation.
In designing any legislative scheme, matters may arise that have not been foreseen, but that need to be dealt with as an integral part of the scheme. This may include a scheme that was intended, because of its relative simplicity and the desire to keep the entire regime in one place, to be dealt with entirely in primary legislation. However, it may be that the implementation of the scheme was not as simple as anticipated and that further detail, direction, or clarification is required. That would be difficult to achieve through amendment to the Act, so (assuming an appropriate regulation-making power is available) dealing with those matters in delegated legislation may be appropriate. See, for example, section 360(1)(g) of the Resource Management Act 1991, which authorised delegated legislation that prescribed transitional and savings provisions relating to the coming into force of the Act.
There may also be instances of legislative schemes in which unforeseen contingencies will, or will be likely to, arise during the “life” of the primary legislation. Such an eventuality should be considered and anticipated and, if appropriate, a suitable regulation-making power included in the Act.
Need for flexibility
It is invariably simpler to make delegated legislation than to enact primary legislation, so it follows that there is far less flexibility in primary legislation than in delegated legislation. An Act, once passed, requires another Act (involving all the usual, time-consuming, Parliamentary processes) to amend it. Delegated legislation can usually be amended or replaced quickly, and with little difficulty in terms of process.
Although it is possible to amend primary legislation by delegated legislation, that process should be used only in exceptional circumstances (see para 10.1.7, Henry VIII clauses). However, use of Henry VIII clauses may be justified if the matter requiring amendment has been included in primary legislation because of the importance to members of the public generally, but which will require regular updating. For example, the rates of benefits set out in the schedules to the Social Security Act 1964 may be increased (but not decreased) by delegated legislation: see section 61H of that Act.
For these reasons, if it appears that a legislative scheme is likely to need frequent change, then consideration should be given to including the matters that are prone to change in delegated legislation. This may include matters that change frequently to keep up to date with changing national and international trends (for example, transport rules), those that change significantly and rapidly because of technological advances (for example, computer and telecommunication technology), and those regimes that may require some experimentation (for example, to test and refine an implementation regime).
Part 3 of the Ozone layer Protection Act 1996 is an example of powers of delegation designed to allow flexibility (including by regulations and by codes of practice) in reducing ozone depleting substances (see also the resulting Ozone Layer Protection Regulations 1996, which prohibit the import, export, manufacture, and sale of certain ozone depleting substances: those regulations have been amended several times, to take account of changing circumstances in this area of science and law).
Emergency conditions requiring speedy or instant action
It may be necessary for legislative schemes to be able to take account of emergencies or situations where prompt action is required.
If the legislative scheme inherently involves issues that may require an emergency or other very prompt response, then consideration should be given to making provision in the Act to include those matters in delegated legislation
Primary legislation is generally not capable of responding to this type of event, and so it is necessary to be able to rely on delegated legislation. An example of preparing for an emergency is the Epidemic Preparedness Act 2006. That Act aims to prevent the outbreak of epidemics in New Zealand and, if an epidemic does break out, to respond to both the epidemic and its consequences. The Act makes wide use of delegated powers to deal with these issues. See also section 144 of the Biosecurity Act 1993 (which enables the declaration of a biosecurity emergency).
Although not strictly “emergency” situations, the following are examples of delegated powers being made available to deal swiftly with changing situations:
- section 2 of the United Nations Act 1946 (which enables measures decided on by the Security Council of the United Nations to be applied in New Zealand).
- Part 4 of the Securities Act 1978 (which enables delegated legislation that takes account of changes in the securities markets).
An empowering provision permitting emergency regulations should set out clear criteria for the exercise of the power and be time limited. In addition, Parliamentary confirmation of the delegated legislation may be appropriate.
In addition to the established grounds specified above, there may be other, particular, reasons that justify Parliament delegating its law-making power. These grounds are likely to be rare, and will obviously require an appropriate empowering provision in the primary legislation.
An example of such a delegation is the power of the Governor-General, under section 55 of the Maori Trust Boards Act 1955, to make orders validating certain irregularities. For example, see the validation, under the Aorangi Maori Trust Board Order 2005, of the 2004 election of members to the Aorangi Maori Trust Board. See also section 266 of the Electoral Act 1993, which enables validation, by delegated legislation, of any act or omission required under the Act that has been irregularly done.
There will inevitably be cases that do not fall clearly into either the primary or delegated legislation category, and that could potentially be placed in either category. Where there is doubt as to whether primary or delegated legislation is more appropriate for a particular matter, the following guidelines may be helpful:
- if the legislation is directed at a limited audience, regulations may be appropriate (see, for example, the Wine (Grape Wine Levy) Order 2005, which applies only to wineries).
- if the subject-matter is highly technical, regulations may be appropriate (see, for example, the Hazardous Substances (Compressed Gases) Regulations 2004, which specify controls to manage compressed gases under the Hazardous Substances and New Organisms Act 1996).
- if division of the material between primary and delegated legislation would lead to an incoherent legislative regime, primary legislation may be appropriate (see, for example, the Building Act 2004). However, care should be taken to ensure that the primary legislation does not become “cluttered” as a result.
- matters that one would expect an ordinary person to rely on may be better dealt with in primary legislation (see, for example, the Consumer Guarantees Act 1993).
- if the matter is likely to be changed or updated at frequent intervals, it may be better to use delegated legislation (see, for example, the Fisheries (Reporting) Regulations 2001. These regulations came into force in October 2001 and, by March 2007, had been amended 16 times).
- if the matter is likely to be controversial, it may be wise to place it in primary legislation, so as to avoid any risk of successful challenge in the courts (see Chapter 10A for guidance on how delegated legislation may be challenged in the courts). For example, the Forests (West Coast Accord) Act 2000 cancelled an agreement between the Crown and certain other parties and excluded any compensation for the cancellation. Although the same result could probably have been achieved under the general law or under delegated legislation, Parliament dealt with the matter in primary legislation. This made the cancellation and “no compensation” provision immune from successful challenge in the courts.
A range of unjustified reasons are sometimes advanced in support of including matters in delegated legislation. Reliance is typically placed on an empowering provision that was not designed for the purpose but which, it appears, is wide enough to encompass that purpose. However, such reasons will rarely (if ever) justify including the matters in delegated legislation.
The following reasons should not be put forward to justify delegated legislation:
- that the policy development was not completed in time. Here, the regulation-making power may be advanced as a method of “filling the gaps” in the primary legislation. Such a legislative safety-net is not permissible. However, if the omission is a genuinely unforeseen contingency, inclusion in delegated legislation may be justified.
- that as a matter of political expediency, delegated legislation should be used. This could be relied on for a number of reasons, including—
- to disguise a controversial issue in the legislative regime by placing it in delegated legislation (because that may be perceived as being “less public”): this reason would never be justified.
- to “get the law through” by placing everything that hasn’t been included in primary legislation in delegated legislation, perhaps to reduce the time the primary legislation takes to pass through Parliament.
- that “it’s always been done this way” and so it should be done this way again. The mere fact that delegated legislation has been used for a particular purpose in the past does not justify it being used in that way again. There may be a number of reasons why it was used in the past, including current practice at the time or simple mistake. Each case must be capable of being objectively justified.
Empowering provisions (the provisions in statutes that enable delegated legislation to be made) should be drafted so that the limits of the delegated legislative power are specified as clearly and precisely as possible.
The accepted basic formula for providing for the making of regulations is as follows:
The Governor-General may from time to time, by Order in Council, make regulations for all or any of the following purposes:
(c) [Each paragraph should specify the purpose as clearly and precisely as possible, with the following final standard paragraph included in every case.]
(d) providing for any other matters contemplated by this Act or necessary for its administration or necessary for giving it full effect.
In addition to the basic formula, it may be appropriate to provide that certain prerequisites must be satisfied before the Governor-General makes the regulations. See, for example, section 170 of the Health Practitioners Competence Assurance Act 2003, which provides that:
The Governor-General may, by Order in Council made on the advice of the Minister given after consultation by the Minister with any authority affected by that advice, make regulations for any or all of the following purposes:
Another issue in this area is the power to amend, suspend, or override the empowering Act or any other Act (Henry VIII clauses). The Regulations Review Committee has recently noted that:
"An empowering provision that enables legislation to be amended by regulation provides the Executive with the power to override Parliament. The committee believes that this power should be granted by Parliament rarely and with strict controls."
As the supreme law-making body, Parliament may occasionally consider that a Henry VIII clause is justified. For example, for the purpose of ensuring a smooth transition from one "old" Act to a new replacement Act, the empowering provision may enable regulations to be made to negate or amend the old Act (see section 360(1)(g) of the Resource Management Act 1991).
When considering whether a Henry VIII clause is justified, the following should be taken into account:
- a provision allowing for the making of regulations to amend the empowering Act should only be used in exceptional circumstances and should not be used routinely in reforming legislation:
- a complex reform involving the amalgamation of a large number of statutes may justify the use of an empowering provision allowing for regulations to override the primary legislation. Technical amendments or a rewrite of an existing Act that does not amount to a substantial change in the principles and context do not justify such use;
- a regulation-making provision that provides for regulations to override primary legislation should be drafted in the most specific and limited terms possible and must at all times be consistent with and support the provisions of the empowering Act:
- that any such provisions should be limited in time. Statutory provisions permitting primary legislation to be modified by transitional regulations should generally be subject to a sunset clause of 3 years:
- regulations made under such a provision should also be subject to the sunset clause set out in the empowering provision or, where that is not considered feasible, subject to confirmation by Parliament:
- a provision for consultation may be appropriate.
Another issue in this area concerns when it is appropriate for primary legislation to provide for the commencement of the legislation by Order in Council. In providing for commencement by Order in Council, Parliament delegates the power to decide on a commencement date to the Executive.
As a general principle, the commencement of legislation should not be delegated because of the risk that the will of Parliament may be frustrated by an Executive that no longer supports the policies in an Act. There is also the risk that, by delegating the power, the courts will be drawn into the process if it is sought to review the Executive action or inaction in bringing legislation into force. Accordingly, as a general principle, legislation should have a fixed commencement date.
These provisions must be clearly justifiable. For example, commencement of legislation by Order in Council may be justifiable in the following situations:
- where legislation implements an international treaty or convention and the commencement of the legislation needs to be co-ordinated with ratification by other States:
- when delegated legislation may need to be made:
- if administrative action is required. For example, appointments may need to be made, and implementation and training programmes may be needed:
- where certain preconditions may have to be satisfied. For example, the approval of a constitution for a body or a scheme for amalgamation or vesting of an undertaking.
There may be uncertainty as to when these matters may be completed.
Matters of policy or principle should be included in primary legislation. Policy and principle are the matters that set out the basic rule in relatively basic terms. Those matters may well be controversial. In deciding whether a matter is likely to be controversial, it may be helpful to consider what the likely public and political reaction to the matter would be if it were publicised in the news media.
Matters that fill in the detail of a legislative scheme or are part of its implementation will usually be included in delegated legislation.
Examples of matters that should ordinarily be included in primary legislation are those that affect fundamental human rights, change the common law, create serious offences, impose significant penalties (particularly imprisonment), impose taxes, amend Acts, or make retrospective changes to the existing law.
Examples of matters that should ordinarily be included in delegated legislation are those that deal with the mechanics of implementing an Act, impose fees, specify forms, provide details of procedures, include long lists, or provide for indexation.
The empowering clause in a statute that provides for regulations should follow the accepted basic formula. Each paragraph in the empowering clause should specify the purpose for which regulations may be made as clearly and precisely as possible. The final standard paragraph should be included in all cases. In certain cases it may be appropriate for an empowering provision to require certain prerequisites to be satisfied before the regulations are made.
Henry VIII clauses should only be used in exceptional circumstances.
WHAT PROCEDURES SHOULD BE SPECIFIED TO CONTROL THE PROCESS OF MAKING THE DELEGATED LEGISLATION?
The empowering statute does not generally prescribe the procedure for making delegated legislation. Consideration should be given in each case as to whether a procedure, or any aspect of the procedure, should be specified.
The empowering statute does not usually impose a procedure in relation to the making of regulations other than the requirement that the Governor-General make the regulations by Order in Council, acting by and with the advice and consent of the Executive Council. There is usually no requirement in the empowering statute for notice and consultation.
The Cabinet Manual specifies requirements in relation to the process for making regulations. Those requirements include -
- consultation; and
- drafting by Parliamentary Counsel; and
- when the regulations are to come into effect (the 28 day rule).
The additional controls set out in Appendix 5 of these Guidelines also apply to regulations (except where the empowering legislation provides otherwise).
In some circumstances, the empowering legislation will provide that Parliament must confirm the regulations. In the absence of that confirmation, the regulations will lapse. This additional control may be necessary where the delegated power is a significant one.
The desirability of including a confirming provision in the empowering statute should be examined when the power to make the following kinds of regulations is being provided:
- emergency regulations:
- regulations imposing a financial charge in the nature of a tax:
- regulations amending the empowering statute or another statute:
- regulations that deal with issues of policy under the authority of broad empowering provisions.
For examples of confirming provisions in the empowering statute, see section 61H of the Social Security Act 1964 and section 80 of the Customs and Excise Act 1996.
If the empowering statute is to provide that the delegated legislation may be made other than by regulations, consideration should be given as to whether the empowering Act should specify-
- any consultation procedure for that delegated legislation; and
- when the delegated legislation may come into effect; and
- whether all or any of the controls specified in Appendix 5 should apply.
If the delegated legislation is to be made by way of regulations, a prescribed consultation procedure may be desirable if-
- a particular organisation or person (other than the person to whom the delegation is made) has special knowledge, experience, or skills in connection with the subject matter of the regulations. In these circumstances consultation may help to resolve any technical problems with the regulations; or
- a particular group of persons will be affected by the regulations. In these circumstances, consultation may help to win the support of that group and increase acceptance by those affected.
For examples of empowering provisions requiring consultation, see section 29(3) of the Fair Trading Act 1986 and section 41A(3) of the Weights and Measures Act 1987.
See Chapter 1, Part 4 and Chapter 10A, Part 1 for further information concerning consultation.
Consideration should be given when providing for delegated legislation as to whether any requirements for notice and consultation, or confirmation of the secondary legislation, should be included in the provisions delegating legislative powers.
Consideration should be given when providing for delegated legislation, other than regulations, whether any or all of the controls set out in Appendix 5 should apply.
TO WHOM SHOULD THE DELEGATION BE MADE?
Law making involves the exercise of a power involving a significant degree of expertise. The persons to whom the power is given should have an appropriate degree of expertise.
Within central Government, law-making powers are delegated to the Governor-General in Council, Ministers, or officials. Local authorities have extensive bylaw-making powers under the Local Government Act 2002 and other Acts. Legislative powers are also given to occupational and professional bodies.
When the law-making power will potentially impact on individual rights and liberties (such as by the creation of offences), careful consideration must be given as to the person who should exercise the power. In that event, it may be appropriate for the Governor-General in Council to exercise the power.
If the law-making power involves prescribing technical matters which will not impact upon individual rights, an official may be the appropriate person to exercise the power.
The expertise of the lawmaker is also a significant factor. One factor in giving law-making power to local authorities and professional bodies is that they have the requisite knowledge and experience to make local bylaws or develop rules for professional bodies. See, for example, section 51C of the Judicature Act 1908, which provides that the High Court Rules can only be made with the concurrence of the Chief Justice and any 2 or more of the members of a rules committee, of whom at least 1 must be a Judge.
The exercise of the power may also be of such significance that it should be exercised by the Governor-General in Council or by a Minister of the Crown in such a way that the controls referred to in Appendix 5 apply to that delegated legislation.
When deciding who to delegate a legislative power to, consideration should be given to -
- the importance of the power; and
- the relevant expertise of the lawmaker; and
- the controls over the exercise of the power.
IS A PROVISION FOR "DEEMED REGULATIONS" APPROPRIATE?
A form of delegated legislation has developed over recent years where some, but not all, of the controls in Appendix 5 apply to that delegated legislation ("deemed regulations"). In particular, this delegated legislation has not been -
- drafted by Parliamentary Counsel; or
- subjected to Cabinet approval; or
- included in the Statutory Regulations (SR) series.
The issue concerns whether the lack of these controls is appropriate.
There are 3 main types of deemed regulations. These types are as follows:
- instruments that are regulations for the purposes of both -
- the Acts and Regulations Publication Act 1989 (ie, must be published in the SR series); and
- the Regulations (Disallowance) Act 1989 (ie, subject to disallowance):
- instruments that are only regulations for the purposes of the Acts and Regulations Publication Act 1989 (ie, must be published in the SR series but are not subject to disallowance):
- instruments that are only regulations for the purposes of the Regulations (Disallowance) Act 1989 (ie, subject to disallowance, but do not have to be published in the SR series).
The language used in the Act will determine the type of instrument. For example, the Act may specify that a particular instrument is deemed to be a regulation for the purposes of the Regulations (Disallowance) Act 1989, but not for the purposes of the Acts and Regulations Publication Act 1989.
In deciding the appropriate status for a piece of delegated legislation, regard should be had to the following criteria:
- the number of people affected and the impact on these people. If the legislation will have a material effect on the rights of a large group of people then "traditional" regulations may be more appropriate:
- the process (including consultation) that should be followed in making the delegated legislation:
- the need for certainty of obligations (clear drafting and consistency), having regard to the consequences of a breach of the obligations:
- the desirable methods of publication of, and accessibility to, the delegated legislation:
- the need for Parliamentary control over the delegated legislation:
- the desirability of having the delegated legislation made by a person other than the Governor-General in Council.
The above criteria, except the last, will usually be best met by requiring the delegated legislation to be "traditional" regulations rather than deemed regulations.
A Parliamentary Counsel certifies "traditional" regulations before they are submitted to Cabinet. The regulations will not be given an unqualified certificate if the Parliamentary Counsel -
- has doubts concerning the vires of the regulations; or
- considers that the regulations are inconsistent with general legal principles:
- considers that some condition precedent, or procedural requirement, set out in the empowering provision in the Act has not been complied with:
- considers that the regulations do any thing referred to in Standing Order 382 (the grounds on which the Regulations Review Committee draws attention to a regulation).
Another important control over "traditional" regulations made by Order in Council is that they are approved by Cabinet and, accordingly, are subject to checks and balances that apply to Cabinet decision-making.
These protections and controls indicate that a strong case should have to be made for an item of delegated legislation not to be a "traditional" regulation. The following reasons may justify the regulation not being a "traditional" regulation:
- the subject matter is not important enough to warrant consideration by Cabinet:
- the subject matter may be highly technical, and thus best dealt with solely by an expert body:
- the subject matter may be of interest only to a limited audience:
- the subject-matter may be the internal rules of an organisation that have minimal effect on members of the public:
- the relevant legislation may wish to promote self-regulation in an industry (in such a case, it may be appropriate to give that industry "ownership" of the rules it enacts):
- there may be strong policy reasons for a particular institution to be able to control the content of rules without intervention by the Government:
- the person or body empowered to make rules may have an independent statutory function and not be accountable to Cabinet, for example, the Privacy Commissioner:
- it might be desirable in the interests of international uniformity to adopt verbatim rules formulated in another country:
- the rules may be of an urgent or temporary character:
- the changing nature of the subject matter may be such that a mechanism for rapid amendment and updating is required.
If consideration is being given to creating deemed regulations, consideration should be given to which of the controls set out in the Appendix 5 should apply. The Government also recently endorsed the following principles recommended by the Regulations Review Committee for considering the controls that should be in place:
- deemed regulations should be published in the SR series unless there is good reason for separate publication:
- separate publication of a deemed regulation is not justified if the regulation imposes obligations that are of general application or interest to the public:
- separate publication of a deemed regulation may be justified if -
- the regulation contains technical matters relevant to a particular group, and the benefits of separate publication outweigh the costs of separate publication:
- the regulation implements detailed provisions of international agreements or standards:
- the regulation is a short-term or emergency measure:
- every submission to Cabinet seeking approval for the introduction of a Bill that provides for separate publication should state the reasons for separate publication:
- every Bill that provides for separate publication should state the reasons for separate publication in the explanatory note:
- a provision for separate publication should specify -
- that notice must be given in the Gazette and any other publication relevant to the individuals or organisations affected:
- that the regulation is available for inspection free of charge and for purchase at a reasonable price (wherever possible):
- that notice is given of the places where the instrument can be inspected or purchased.
Generally, it is desirable for secondary legislation to be in the form of "traditional" regulations and subject to all the controls set out in Appendix 5. In determining whether traditional or deemed regulations should be created, the criteria described above should be taken into account. If deemed regulations are to be created, consideration should be given to which controls set out in Appendix 5 should apply.
IS A PROVISION FOR A "SUBDELEGATION" APPROPRIATE?
The issue in this Part concerns the circumstances in which it is appropriate for an empowering provision to permit delegated legislation to delegate a law making power.
In general, the person to whom the power to legislate is delegated cannot in turn delegate that power to another person. In other words, a delegate cannot delegate. Accordingly, a subdelegation without legislative authority will be invalid.
Instruments made under a subdelegation are not usually subject to any of the controls in Appendix 5. It will, therefore, generally be appropriate for an Act to authorise a subdelegation only if it involves technical or rapidly changing requirements and does not impact upon the rights and interests of individuals.
For further information concerning unlawful subdelegations, see Chapter 10A, Part 3.
A subdelegation should generally be authorised only in the circumstances set out above. If it is authorised in other circumstances, consideration should be given to applying some or all of the controls set out in Appendix 5.
IS THE USE OF "INCORPORATION BY REFERENCE" APPROPRIATE?
The term "incorporation by reference" refers to the creation or definition of rights, powers, and obligations by a reference in an Act of Parliament or delegated legislation to another document the provisions of which are not set out in the legislation. When should an empowering provision permit the use of incorporation by reference?
The issue of incorporation by reference can be considered in relation to the following principles of making or amending any law (other than the common law):
- Parliament must make or authorise the law:
- Parliament should have control over delegated legislation:
- an appropriate process, including consultation, should be followed in making the law:
- the obligations imposed by legislation should be certain and understandable by those affected:
- all legislation should be published in a form and manner that enables ready access by those affected.
Incorporation by reference is, to a certain extent, inconsistent with these principles of good law making. Accordingly, incorporation by reference should only be used where it is impracticable to do otherwise.
When considering whether to use incorporation by reference, the principles set out in Appendix 4 should be complied with.
IF THE LEGISLATION INCLUDES A POWER TO GIVE POLICY DIRECTIONS, HAS THE APPROPRIATE PROCESS BEEN FOLLOWED?
It may, at times, be appropriate for legislation to give the Government the ability to give policy directions to a body or person. This is similar to delegating an ability to make law.
If the Government has a statutory power to give policy directions to a body or person, that body or person must carry out its functions in accordance with that direction. The rights, duties, and interests of those affected by the decisions of the body or person may accordingly be altered by the direction.
Directions should be required to:
- be given in writing and signed only by a Minister of the Crown; and
- be published in the Gazette and laid before the House of Representatives as soon as practicable after they are given (exceptions to this may be made where the public interest does not require immediate publication and publication would prejudicially affect economic or commercial interests); and
- be restricted to considerations of policy; and
- not be given where they might interfere with the duty of independent tribunals to act judicially in the determination of individual matters which relate to a particular person or organisation.
For example, see section 26 of the Commerce Act 1986 (Commerce Commission to have regard to the economic policies of Government) and sections 10 and 11 of the Sport and Recreation New Zealand Act 2002 (compliance with Government policy).
Any power of the Government to give policy directions to administrative tribunals should comply with the requirements set out above.
103 Tanner, G and Chen M, Delegated Legislation, NZLS Seminar, May 2002, 95.
103a Although “regulation” in this context is narrower than the concept of “delegated legislation” (because standing order 3 defines a regulation as meaning “a regulation within the meaning of the Regulations (Disallowance) Act 1989”), one should work on the basis that the same considerations will apply to delegated legislation generally.
103b See Malone, R, Regulations Review Committee Digest (2nd ed), New Zealand Centre for Public Law, Victoria University of Wellington, Wellington, 2006, particularly at pp56-58. The Digest is available online at www.vuw.ac.nz/law/Centres/NZCPL/Files/RegsReview/RRC%20Digest.pdf
103c Report of the Committee on Minister’s Powers (1932), Cmnd 4060
103d Report of the Committee on Delegated Legislation, AJHR, 1962, I.18.
103e The “opportunity for experiment” ground is not discussed as a separate ground in the chapter. That ground is discussed as part of the “need for flexibility” ground.
104 Tanner, G, “Confronting the Process of Statute-Making” in Bigwood, R, The Statute: Making and Meaning, LexisNexis, Wellington, 2004, 85.