REGULATORY REGIME

The statutory regime governing coal mining activities in Victoria is complex and has evolved considerably over time.

Mine licensing and occupational health and safety laws are the principal regulatory mechanisms that govern GDF Suez’s responsibilities concerning the risk and prevention of fire at the Hazelwood mine.

MINE LICENSING LEGISLATION

Coal mining activities in Victoria are regulated under the Mineral Resources (Sustainable Development) Act 1990 (Vic) (Mineral Resources Act), the Mineral Resources (Sustainable Development) (Mineral Industries) Regulations 2013 (Vic) (Mineral Industries Regulations), and the Mineral Resources (Sustainable Development) (Extractive Industries) Regulations 2010 (Vic).

The stated purpose of the Mineral Resources Act is ‘to encourage mineral exploration and economically viable mining and extractive industries which make the best use of, and extract the value from, resources in a way that is compatible with the economic, social and environmental objectives of the State.’1

To accomplish this purpose, one of the objectives of the Mineral Resources Act is to ‘establish a legal framework aimed at ensuring that…the health and safety of the public is protected in relation to work being done under a licence…’.2 The interests of the public are therefore at the heart of the mine licensing regime.

The primary instruments by which the purpose and related objectives of the Mineral Resources Act are fulfilled are mining licences, work plans and work authorities.3 Because the licence for the Hazelwood mine was a product of its privatisation, the licensing process differed from requirements now in effect in Victoria.4 The Hazelwood mine is subject to licensing and work plan provisions, but not to provisions relating to work authorities.5

The Minister for Energy and Resources is responsible for administration of the Mineral Resources Act and related regulations.6 Administration of the Mineral Resources Act is overseen by the Earth Resources Regulation Branch of the Department of State Development, Business and Innovation (DSDBI), as the Minister’s delegate.7 In this Chapter, the Earth Resources Regulation Branch of DSDBI and its various predecessors will be referred to as ‘the Mining Regulator’, whilst noting that since 1 January 2008, the Victorian WorkCover Authority (VWA) has been the regulator for occupational health and safety in mines.

Under s. 8(1)(a) of the Mineral Resources Act, a person cannot carry out mining in Victoria without obtaining a mining licence from the Minister. An applicant for a mining licence must satisfy the Minister that it can meet the requirements set out in s. 15(6) of the Mineral Resources Act. The Minister is empowered to impose conditions on a mining licence.8

On its own, a mining licence is insufficient authority to carry out mining activities.9 Section 40 of the Mineral Resources Act requires that an approved work plan must be lodged with the Department Head of the Mining Regulator before the licensee can undertake mining work. Under s. 39, the operator of a mine must comply with any conditions on the mining licence and the approved work plan, and work in accordance with the approved work plan.

The Department Head of the Mining Regulator approves a work plan. The Department Head may specify, in granting such an approval, that certain conditions must be observed by the licensee in carrying out the work plan.10 Under s. 41, the Department Head may vary a work plan at his or her discretion.

The conditions that a Minister or the Department Head may impose in respect of a mining licence, work plan or work plan variation, are non-exhaustive—they include but are not limited to:

  • rehabilitation of the land
  • protection of the environment
  • providing and implementing environmental offsets on the land or any other land
  • work undertaken under a licence
  • protection of community facilities.11

Section 40(3)(a) of the Mineral Resources Act requires that a work plan must contain ‘prescribed information’, which for a coal mine larger than five hectares means that the work plan must address the matters prescribed by Schedule 15 of the Mineral Industries Regulations.12 Currently, Schedule 15 specifies that work plans must address matters such as:

  • the anticipated extent of open cut extraction, with proposed bench height, berm details and working batters
  • the sequencing of open cut extraction
  • the location of topsoil dumps, and waste dumps or stockpiles
  • proposals for landscaping of the site, including buffer zones
  • access roads
  • a rehabilitation plan, including concepts for the end utilisation of the site, and proposals for the progressive rehabilitation and end rehabilitation of the site
  • an environmental management plan
  • a community engagement plan
  • for ‘declared mines’ such as the Hazelwood mine, mine stability.13

The rehabilitation plan for the Hazelwood mine was the subject of considerable attention during the Inquiry, as rehabilitation of worked out areas of a coal mine is a recognised means of eliminating or reducing the risk of fire. Once a worked out batter has been rehabilitated, coal is no longer exposed and it therefore follows that the rehabilitated land bears no greater fire risk than any other ordinary part of the rural landscape.14

Progressive rehabilitation is of particular importance in the context of fire prevention in the short to medium term, as final, end rehabilitation at the Hazelwood mine is not expected to be completed until at least 2031.15

Rehabilitation at the Hazelwood mine is explored in further detail in Chapter 3.3 Fire prevention and mitigation measures taken by GDF Suez.

Professor Samantha Hepburn of the School of Law at Deakin University made a submission to the Board, which explored the concept of the rehabilitation plan in more detail. She explained that:

The underlying rationale for a rehabilitation plan is to provide an outline of how a mining licencee [sic] plans to remediate and mitigate the impact of the mining process upon the land and the landscape during the operational life of the mine. The guidelines that accompany the [Mineral Resources Act] provide further detail regarding how a rehabilitation plan should be constructed. The guidelines make it clear from the outset that the rehabilitation plan must direct, from the date when the licence is applied for, remediation and maintenance of the land and the mining operations will occur during the currency of the licence.16

Under the Mineral Resources Act, a mine licensee is also required to:

  • rehabilitate land in accordance with the approved rehabilitation plan (which forms part of the work plan)17
  • enter into a rehabilitation bond for an amount determined by the Minister, which the Minister may subsequently reassess and increase18
  • consult with the community by sharing information and providing members of the community with an opportunity to express their views about mining activities that may affect the community19
  • notify the Chief Inspector of Mines of ‘reportable events’, which include a ‘major outbreak of fire’.20

Section 110 of the Mineral Resources Act empowers the Minister to issue a notice requiring the mine licensee to take a specific action or stop work if the Minister believes on reasonable grounds that (among other things) any action or omission of a licensee is likely to result in a risk to public safety, the environment, land, property or infrastructure, or breaches a condition applying to the licence or work plan.

In practice, the Mining Regulator considers this ‘stop work’ power a drastic measure that would only be relied upon ‘in extreme situations or when previous notices had not been dealt with.’21

Upcoming reform

A number of amendments to the Mineral Resources Act will come into effect over the next two years.

The Mineral Resources (Sustainable Development) Amendment Act 2014 (Vic) (Mineral Resources Amendment Act) received royal assent on 25 February 2014. Under s. 16 of the Mineral Resources Amendment Act, the existing s. 40(3) of the Mineral Resources Act will be amended so that work plans will need to meet the following requirements:

(3) A work plan must –

(a) be appropriate in relation to the nature and scale of the work proposed to be carried out; and

(b) identify the risks that the work may pose to the environment, to any member of the public, or to land or property in the vicinity of the work; and

(c) specify what the licensee will do to eliminate or minimise those risks as far as reasonably practicable; and

(d) if the licence is a mining licence or prospecting licence, in relation to the mining activities proposed to be carried out under the licence, include a plan for consulting with the community that demonstrates that the licence holder will use appropriate and effective measures to consult with the community throughout the period of the licence and is prepared in accordance with the regulations and any guidelines issued by the Minister relating to such plans (a community engagement plan); and

(e) if the licence is a mining licence or a prospecting licence under which mining activities are proposed to be carried out, include a rehabilitation plan for the land proposed to be covered by the licence; and

(f) if the licence is a mining licence relating to a declared mine, contain the prescribed mine stability requirements and processes; and

(g) contain any other matters required by the regulations.

The Board heard evidence that the requirements emphasised above might assist the Mining Regulator to require work plans to address fire risk in Victorian mines. This is explored in further detail below under the heading ‘Oversight by the Mining Regulator’.

The amendment is designed to achieve a more outcome-based approach to regulation of work plans. It reflects mining regulation reform recommended by the Economic Development and Infrastructure Committee:

That the Victorian Government considers redirecting the regulatory focus of exploration, mining and extractive work plans towards outcomes and away from prescriptive conditions, in order to better manage risk and achieve socially, economically and environmentally sound outcomes.22

Section 16 does not come into operation until 31 December 2016, unless proclaimed earlier.23

OCCUPATIONAL HEALTH AND SAFETY LEGISLATION

All Victorian workplaces, including the Hazelwood mine, are subject to obligations under the Occupational Health and Safety Act 2004 (Vic) (OHS Act) and the Occupational Health and Safety Regulations 2007 (Vic) (OHS Regulations).

Administration and enforcement of the OHS Act and OHS Regulations is the responsibility of the VWA.

Occupational Health and Safety Act

The principal objects of the OHS Act are to secure the health, safety and welfare of employees and other persons at work and to eliminate (at the source) risks to health, safety or welfare.24 The Act also aims ‘to ensure that the health and safety of members of the public is not placed at risk by the conduct of undertakings by employers and self-employed persons.’25

The following critical principles underpin the operation and interpretation of the OHS Act:

  • The importance of health and safety requires that employees, other persons at work and members of the public be given the highest level of protection against risks to their health and safety that is reasonably practicable in the circumstances.
  • Persons who control or manage matters that give rise or may give rise to risks to health or safety are responsible for eliminating or reducing those risks so far as is reasonably practicable.
  • Employers and self-employed persons should be proactive, and take all reasonably practicable measures, to ensure health and safety at workplaces and in the conduct of undertakings.26

The OHS Act adopts a self-regulatory and performance-based model rather than a traditional prescriptive approach to workplace safety regulation. Mr Leonard Neist, Executive Director of the Health and Safety Unit at the VWA, explained the difference as follows:

Generally, Victorian OHS laws are based on the ‘Robens model’ of regulation. The recommendations made by Robens’ Committee in 1972 (in the UK) resulted in widespread legislative reform in health and safety regulation. In essence OHS laws shifted from detailed, prescriptive standards to a more self-regulatory and performance-based approach. Instead of prescribing how to do (or not do) something, the OHS Act requires the owner of the risk (the duty holder) to take responsibility to achieve the desired outcome. In other words, the Act identifies the outcome (a safe workplace) but places the responsibility on the duty holder to identify the risks and the controls needed to achieve the outcome.

At present in Victoria, a combination of prescriptive and performance based regulatory elements exist in our legal framework, as the Regulations do contain some prescriptive requirements.27

The principal statutory obligations relevant to this Inquiry are ss. 21 and 23 of the OHS Act.

Section 21 of the OHS Act obliges all employers to provide and maintain, so far as is reasonably practicable, a working environment that is safe and without risks to health. Section 21 applies to employees, defined to include independent contractors engaged by the employer, as well as employees of any such independent contractors.28

The duty under s. 23 of the OHS Act is broader than s. 21. It compels employers to ensure that, so far as is reasonably practicable, persons other than employees are not exposed to risks to their health or safety arising from the conduct of the undertaking of the employer.

The duty imposed by s. 23 requires an employer to eliminate risks to health and safety so far as is reasonably practicable, or if it is not reasonably practicable to eliminate risks to health and safety, to reduce those risks so far as is reasonably practicable.29

In the context of the Hazelwood mine fire, s. 23 would extend to firefighters (career and volunteer) and members of Morwell and surrounding communities. The duty applies only to the extent that risks to health or safety arise ‘from the conduct of the undertaking of the employer’ and only to the extent that the mine’s operator did not eliminate or reduce risks ‘so far as is reasonably practicable’.

The meaning of ‘so far as is reasonably practicable’ and risks arising ‘from the conduct of the undertaking of the employer’ were discussed at length during the Inquiry.

As noted by Mr Neist, the term ‘so far as is reasonably practicable’ is not defined by the OHS Act.30 Section 20(2) of the OHS Act specifies a number of matters to which an employer must have regard to determine what is (or was at a particular time) reasonably practicable. These are:

  • the likelihood of the hazard or risk concerned eventuating
  • the degree of harm that would result if the hazard or risk eventuated
  • what the person concerned knows, or ought reasonably to know, about the hazard or risk and any ways of eliminating or reducing the hazard or risk
  • the availability and suitability of ways to eliminate or reduce the hazard or risk
  • the cost of eliminating or reducing the hazard or risk.

A number of further considerations apply when interpreting what is ‘reasonably practicable’ for the purposes of the OHS Act. According to a VWA guideline publication issued under s. 12 of the OHS Act:

  • The test is an objective one and reflects the interpretative principle in s. 4 of the OHS Act:
  • The test for what is reasonably practicable is an objective test; that is, a person is to be judged by the standard of behaviour expected of a reasonable person in the duty holder’s position who is required to comply with the same duty, and is committed to providing the highest level of protection for people against risks to their health and safety and is proactive in taking measures to protect the health and safety of people.
  • In applying the concept of what is reasonably practicable, careful consideration must be given to each of the matters set out in s. 20(2) of the OHS Act and no one matter determines what is or was reasonably practicable in relation to ensuring health and safety.
  • In terms of assessing the cost of eliminating or reducing the hazard or risk:
  • There must be a clear presumption in favour of safety. Once the likelihood and degree of harm from hazard or risk is understood and the availability and suitability of a relevant safety measure to eliminate or reduce the hazard of risk is established, that safety measure should be implemented unless the cost of doing so is so disproportionate to the benefit in terms of reducing the severity of the hazard that it would clearly be unreasonable to justify the expenditure.
  • In some circumstances, cost could never be used as a justification for failing to implement an appropriate control measure:
  • If the degree of harm is significant, then it is extremely unlikely that the cost of eliminating or reducing the risk would ever be so disproportionate to the risk to justify a decision not to implement an available and suitable control measure. Moreover, the question of what is reasonably practicable is to be determined objectively and not by reference to the duty holder’s capacity to pay or other particular circumstances.31

Mr Neist confirmed that the above criteria reflect current VWA policy.32

Mr Neist further explained to the Board that evaluating the cost of eliminating or reducing the hazard or risk involves consideration not only of the cost of implementing a particular control to eliminate or reduce the risk, but also the cost of not implementing a control33—that is, ‘it is a full economic analysis, it’s not just a dollar cost analysis.’34

Occupational Health and Safety Regulations

Part 5.3 of the OHS Regulations creates a range of specific additional obligations with respect to mines. In particular, rr. 5.3.7 to 5.3.9 are intended to reflect the way in which the statutory duties under ss. 21 and 23 of the OHS Act are to be performed by mine operators.35

Under r. 5.3.7(1) of the OHS Regulations, the operator of a mine must, so far as is reasonably practicable, identify all mining hazards at the mine and assess the risks to health or safety associated with all mining hazards at the mine. Mining hazards are defined to include ‘mine fires or explosions’.36

In assessing the risks to health or safety associated with a mining hazard under r. 5.3.7(1), the operator must have regard to:

  • the nature of the mining hazard
  • the likelihood of the mining hazard causing, or contributing to, any harm to any person
  • the severity of the harm that may be caused.37

Under r. 5.3.8(1) of the OHS Regulations, the operator of a mine must also adopt risk control measures that:

  • eliminate so far as is reasonably practicable risks to health or safety associated with any mining hazards at the mine, or
  • if it is not reasonably practicable to eliminate those risks, reduce those risks so far as is reasonably practicable.

Once risk control measures have been adopted, r. 5.3.9 requires the operator of a mine to review and, if necessary, revise (at least every three years, and after any incident involving a mining hazard):

  • the identification of mining hazards
  • the assessment of risks to health or safety associated with mining hazards
  • the risk control measures adopted.

‘Prescribed mines’, including the Hazelwood mine, are subject to a range of additional obligations.38 In particular, r. 5.3.21 requires the operator of a prescribed mine to establish and implement a Safety Management System. A Safety Management System is a document that must (among other things) ‘provide a comprehensive and integrated management system for all risk control measures adopted under r. 5.3.8.’39 A Safety Management System must be reviewed and, if necessary, revised at least every three years, as well as if an incident involving a mining hazard occurs at the mine.40

A further regulation (r. 5.3.23) applies in respect of ‘major mining hazards’, that is, ‘a mining hazard that has the potential to cause an incident that would cause, or pose a significant risk of causing, more than one death.’41 In order to assess the risks associated with major mining hazards, an operator of a prescribed mine must conduct a comprehensive and systematic Safety Assessment. The Safety Assessment must include an investigation and analysis of the major mining hazards in order to provide the operator with a detailed understanding of all aspects of risks to health or safety associated with major mining hazards.42

The Safety Assessment must also record (among other things):

  • the methods used in the investigation and analysis
  • the nature of each major mining hazard
  • the likelihood of the major mining hazard causing, or contributing to causing, any harm to any person
  • the severity of the harm that may be caused
  • reasons for the decisions reached about the likelihood and severity of harm
  • all measures considered for the control of risks associated with major mining hazards
  • the reasons for adopting, or rejecting all risk control measures considered.43

As the operator of a prescribed mine, GDF Suez was at all relevant times required to establish and implement a Safety Management System and to conduct a comprehensive and systematic Safety Assessment in relation to all ‘major mining hazards’.

RECENT HISTORY OF REGULATION OF VICTORIAN COAL MINES

Ms Kylie White, Executive Director, Earth Resources Regulation Branch, DSDBI, provided evidence to the Board regarding recent and complex shifts in responsibility for regulatory oversight of Victorian coal mines. These shifts have led to a degree of uncertainty regarding the extent to which different government agencies have responsibility for regulating issues relating to fire risk, and concerns that there is a regulatory gap.

A representation of the evolution of mine regulation is shown in Figure 3.3 below.

Figure 3.3 Overview of regulatory oversight of fire risk at Hazelwood mine over time

3.8 Diagram-Overview o_opt

From privatisation of the Latrobe Valley mines in 1996 until 4 December 2002, the Department of Natural Resources and Environment (DNRE) was responsible for regulation of the Hazelwood mine.

On 5 December 2002, the DNRE split into the Department of Primary Industries (DPI) and the Department of Sustainability and Environment (DSE). Following this split, responsibility for oversight of coal mines resided with DPI.

On 1 July 2013, DPI and DSE re-merged to form the Department of Environment and Primary Industries (DEPI). However, responsibility for regulation of coal mines was transferred to the Earth Resources Regulation Branch of DSDBI, the present Mining Regulator.44

In 2002, a range of legislative reforms meant responsibility for ensuring compliance with occupational health and safety (OHS) requirements shifted from the jurisdiction of the Mining Regulator (then DPI) to VWA.45 However, work plans for mines were required to include an OHS plan.46 This meant that the Mining Regulator was able to influence the OHS practices of mine operators through the work plan approval process. VWA delegated its power to enforce the OHS regime to the Mining Regulator, with the effect that the Mining Regulator remained in charge of regulating OHS at the mine, just as it had prior to 2002. VWA and the Mining Regulator also entered into a Memorandum of Understanding, which detailed the manner in which the agencies would collaborate, share resources and information, and carry out investigations.47

In May 2006, Mr Neil Pope reported to the Minister for Energy, Industries and Resources about the regulation of OHS in Victoria’s earth resources industries. He recommended that the VWA take direct responsibility for the administration and enforcement of the OHS regime and the Mining Regulator retain responsibility for the approval of work plans under the Mineral Resources Act.

One of the recommendations of the 2006 Pope Report was that the newly established unit within the VWA ‘should include the transfer from the DPI of at least two qualified mining engineers and all regulation officers currently within the Minerals and Extractive Operations Branch.’48

According to Ms White, only one staff member from the Mining Regulator transferred to VWA.49

The recommendations in the 2006 Pope Report were adopted and from 2006 to 2008, transitional arrangements were put in place to manage the transfer of OHS responsibilities from the Mining Regulator to VWA.50

On 20 December 2007, the delegation of OHS powers to the Mining Regulator was withdrawn by VWA.51 According to Ms White, 1 January 2008 marked the transition of OHS responsibility to the VWA with the effect that from that date, the Mining Regulator ceased to have a role or responsibility in mitigating the risk of fire at the mine under the Mineral Resources Act.52

A series of legislative changes in 2010 completed the transfer of responsibility for OHS matters in mines to the VWA.

Prior to 2010, work plans were required to include ‘[a]n occupational health and safety plan that demonstrates, so far as is practicable, that the works are designed and will be operated so as to be safe and without risks to health.’53 It was through this requirement that the Mining Regulator was able to ensure that mining licensees adopted policies and strategies directed to the prevention and mitigation of the risk of fire in the mine.

With the commencement of the Mineral Resources Development (Mining) Amendment Regulations 2010 (Vic), the requirement to include an OHS plan in a work plan was removed.54 The provision in the Mineral Resources Act that empowered the Governor in Council to make regulations concerning health and safety plans was also repealed in the same year.55

Finally, a new requirement for mine operators to notify the Mining Regulator of major outbreaks of fire was inserted into the Mineral Resources Act.56

The transition of OHS responsibilities from the Mining Regulator to VWA was the subject of an audit conducted by Deloitte Touche Tohmatsu (Deloitte) in June 2008. The audit concluded that:

  • There was clear awareness of responsibilities for OHS in the mining industry that were transferred from the Mining Regulator to VWA.
  • The residual risk to the Mining Regulator (including the residual risk associated with public safety) following the transfer of responsibilities for OHS in the mining industry to VWA was appropriately understood and resourced.
  • The Mining Regulator could demonstrate that it had made all practicable attempts to ensure a comprehensive transition of OHS responsibility to VWA.57

The audit also noted that:

Copies of recent OH&S information pertaining to sites have been provided to [VWA] electronically. There is some information located on hard copy files that will remain with DPI. In the future, [VWA] may wish to view this historical information. The agencies will share access to current information as arranged and agreed through local managers.58

However, Mr Kevin Hayes, Field Subject Matter Expert and Workplace Inspector in the Earth Resources Unit of the VWA, told the Board that VWA did not have access to files of the Mining Regulator in relation to the Hazelwood mine before 1 January 2008, as suggested by the Deloitte audit.59

Following the Inquiry’s public hearings, the Victorian Government provided further clarification around these issues:

  • In relation to the transfer of staff, it was suggested that rather than force Mining Regulator staff to VWA, VWA conduct an open recruiting process to employ three mining engineers and two inspectors for mines. Additional responsibilities would be absorbed within existing staffing at VWA.
  • In relation to the availability of files, 600–700 files were assessed for transfer from the Mining Regulator to VWA. In relation to the Hazelwood mine, the Mining Regulator retained the hard copy of registered site files and audit program files (including results). VWA was to be given copies if it requested them.60

In its submission to the Board, the Victorian Government also noted that the Deloitte audit referenced a number of mechanisms through which mining industry knowledge was transferred from DPI to VWA from 2006 to 2008. This included monthly steering committee meetings attended by senior officers from the Mining Regulator and VWA,61 and other activities such as a tripartite forum, the production of a minerals and extractive operations newsletter, training and presentations.62

It is apparent from the audit report that Deloitte was engaged by the Mining Regulator and in conducting its audit, Deloitte only held discussions with staff employed by the Mining Regulator and not VWA.63

CURRENT RESPONSIBILITIES FOR REGULATION

The relationship between the Mining Regulator and VWA is now governed by a further Memorandum of Understanding, effective from 1 January 2011 to 31 December 2013. By convention, this Memorandum of Understanding is treated as ongoing until a new agreement is entered into.64

Clause 1.2 of Schedule 1 of the current Memorandum of Understanding governs the manner in which the parties propose to manage areas of overlapping responsibilities with respect to work in Victorian mines:65

1.2 Overlapping responsibilities

1.2.1. Both agencies have objectives in their legislation that dictate responsibility for public safety matters and the use of explosives. WorkSafe Victoria has responsibility for public safety arising from work-related activities.

1.2.2. WorkSafe Victoria and DPI will consult on matters where their jurisdictions overlap with the lead agency being the agency with the highest degree of control over the issue. (Note safety aspects of gathering lines under the Petroleum Act 1998 will also be referred to EnergySafe Victoria (“ESV”).)

Safety Related Elements

DPI

WorkSafe Victoria

Public safety and amenity ✔Lead Agency ✔Support Agency
Public safety (work related) ✔Support Agency ✔Lead Agency
Operation design and works approval ✔Lead Agency ✔Support Agency
Variations to operation plans and licences ✔Lead Agency ✔Support Agency
Well Integrity ✔Lead Agency ✔Support Agency
Occupational health and safety ✔Support Agency ✔Lead Agency
Explosives ✔Support Agency ✔Lead Agency
Blasting impacts (airblast & ground vibration) ✔Lead Agency ✔Support Agency
Site rehabilitation planning ✔Lead Agency N/A
Site rehabilitation activity ✔Lead Agency ✔Support Agency

Under the Memorandum of Understanding, the Mining Regulator is the lead agency for ‘public safety and amenity’.

When asked to clarify what ‘public safety and amenity’ refers to in the context of the Mining Regulator’s responsibilities, Ms White responded that it:

relates to or has been described as matters relating to safe access, gates, fencing, ensuring that the site is secure and that, if you like, the public are not put unnecessarily at risk from being able to enter the site or be impacted by what’s happening. There is another aspect which relates to mine stability or the need to be able to ensure that, for example, the northern batters, which are terminal batters, that means they’re not going to be worked any further, that those batters are seen to be stable and don’t pose a risk to the public.66

Ms White agreed that this was not spelled out in the table referred to above.67

Mr Neist told the Board that ‘public safety (work related)’ was synonymous with the extent of the responsibility for public safety under s. 23 of the OHS Act, that is, risks to the health and safety of persons other than employees that arise from the conduct of the undertaking of the employer.68

Mr Neist also provided an opinion to the Board relevant to the interpretation of risks arising ‘from the conduct of the undertaking of the employer.’ Mr Neist submitted to the Board that the Hazelwood mine fire did not arise from the conduct of the mine operator’s undertaking, because ‘the undertaking is to extract brown coal from the earth and transport the brown coal to a power station; there is nothing in that conduct that caused the fire.’69 On this view, the Hazelwood mine fire was beyond VWA’s regulatory reach under s. 23.

The Victorian Government submitted that Mr Neist’s evidence on this issue was given without the ‘benefit of legal advice’ and ‘should not be taken as reflecting VWA’s considered position.’70

Counsel Assisting the Inquiry submitted that Mr Neist’s view was incorrect both as a matter of law and fact, namely:

  • Courts have construed s. 23 (and its equivalent provisions in other similar statutes) broadly and in a manner that is consistent with the objects of the OHS Act. Generally speaking, where an activity or event occurs at the place at which the undertaking is carried out, it will be considered to arise from the conduct of the undertaking.71
  • The worked out areas of the Hazelwood mine are not ‘non-operational’—there is extensive infrastructure (such as high voltage power lines, pipes, watering systems, geotechnical monitoring equipment) in and around the northern batters which are essential to the mine’s operations.

The Victorian Government tentatively supported the position of Counsel Assisting.72

Mr Neist agreed that this suggested a regulatory gap exists in relation to a fire risk that does not arise from the conduct of the undertaking of the employer:

If I identify that gap as, who is responsible for regulating for the protection of public safety, regardless of what the source of the hazard or the risk is, who’s responsible for public safety, that’s where the gap probably is and I can’t—if you were to ask me right now, I can’t tell you who is responsible for regulating public safety. I’m responsible for regulating workplace safety and responsible for public safety as a result of the conduct of that undertaking, but I couldn’t tell you who is directly responsible.73