5. Evaluation of the occupations model
Page Index
- Is the Mutual Recognition Agreement generally achieving its objectives?
- Other issues raised in submissions
- Mutual recognition has promoted national consistency
- Other issues
- Negative licensing
- Conclusions
Is the Mutual Recognition Agreement generally achieving its objectives?
5.1.1 The review received a large number of submissions from professional associations and registration boards. Experiences with mutual recognition vary, between occupations and between jurisdictions within the same occupations. In general, it appears that the objectives of the MRA are being realised.
Is mutual recognition working well for occupations?
5.1.2 On balance, the scheme appears to be working well for most occupations and isachieving the objectives of removing barriers to movement of skilled service providers between jurisdictions.
5.1.3 The Australian Council of Professions stated that the professions constituting the Council:
"endorse the value of the scheme both in terms of the contribution it makes to mobility of professional practitioners within Australia and in terms of the essential under-pinning it gives to the export of Australian professional services into overseas markets."
5.1.4 This view was confirmed by the Institute of Engineers, Australia, which stated that:
"the Mutual Recognition Agreement has been reasonably successful. The identifiable benefits have included economic and social gains through the creation of more competitive markets including, in particular, a more flexible and responsive labour market. This has been achieved through reduction or removal of regulatory barriers to the mobility of professionals."
5.1.5 The New South Wales Health Department stated that:
"in NSW the principles of implementation of Mutual Recognition as to occupations have been relatively smoothly implemented in the area of registration of health professions. There appear to be no concerns about the continuation of the current system..."
5.1.6 The Nurses Registration Board of New South Wales stated that:
"The process has improved the portability of qualifications and access to registration and employment opportunities."
5.1.7 There appears to be a general consensus that, subject to some qualifications discussed below, the MRA is operating smoothly and achieving its objectives. The basic objective of mutual recognition in relation to occupations was to remove unnecessary barriers to mobility of people between jurisdictions. In particular, the MRA eliminates the need for practitioners to undergo examinations or meet other requirements for registration in each jurisdiction in which they wish to practice. This is becoming more important in a number of professions where modern developments in communications technology mean that services can be provided on a national basis by practitioners physically located in a particular jurisdiction.
The MRA has streamlined registration for practitioners working in other jurisdictions
5.1.8 A number of submissions highlighted the way in which mutual recognition had simplified and streamlined registration processes.
5.1.9 The Australian Veterinary Association stated that:
"Recognition has removed the time consuming and bureaucratic procedure for professionals moving between jurisdictions. It allows veterinarians to take short term opportunity for experience and diversity of practice."
5.1.10 This view was supported by the New South Wales Medical Board which stated that mutual recognition has:
"simplified the requirements for interstate registration" and that "mutual recognition has made it easier for practitioners to transfer to different States if the need arises."
5.1.11 The Australian Nursing Council stated that:
"mutual recognition has enabled a more simplified approach for the member of a registered occupation to gain registration in another State or Territory."
"the system of registration using mutual recognition has become easier for nurses in that the documentation required when applying for registration under mutual recognition is less, and, the process ... is more speedy."
5.1.12 These views were shared by the Royal College of Nursing in their comments:
"The portability of nurses is enhanced and the process for registering in another State or Territory is easier and less daunting since the introduction of mutual recognition. The development and update of minimum professional standards for registration further develops relationships with regulatory authorities and the profession throughout Australia."
5.1.13 Mutual recognition was regarded as a significant benefit for occupations which required regular movement across State and Territory boundaries. For example, the Australian Veterinary Association stated that:
"Large animal practitioners travel long distances often across States and their boundaries. Specialties are many and specialists few so there is significant visiting of country and interstate centres. Welfare, government and academic professionals travel widely in the course of their duties. Mutual Recognition is a significant benefit to the profession."
5.1.14 A key objective of mutual recognition was to make it simpler for registered practitioners to obtain registration in other jurisdictions. This is particularly useful for practitioners that regularly practice their occupation outside their jurisdiction of residence such as the large animal veterinarians discussed above. Streamlined registration is also of benefit to persons practicing in various jurisdictions through their employment with firms providing services nation wide. For example, a solicitor working for a national law firm wishing to practice in a number of jurisdictions would have previously been required to be separately admitted to practice in all those jurisdictions in which he or she was seeking to practise. The MRA has simplified the processes for individuals wishing to practise in multiple jurisdictions.
5.1.15 Further developments, such as the proposal for a national practising certificate for lawyers, would further enhance mutual recognition by removing the requirement to seek separate registration in all jurisdictions. This model could be extended to other jurisdictions and could be a way of dealing with concerns about different standards between jurisdictions. For example, a national practising certificate could be granted to those practitioners that meet registration requirements that have been mutually agreed by all relevant registration authorities. Holders of a national practising certificate would be allowed to practice anywhere in Australia as long as they were registered in one jurisdiction.
Recommendation 6
That occupational registration authorities consider, where appropriate, the development of a national practising certificate based on mutually agreed registration requirements.
The MRA has improved communication between State and Territory registration authorities
5.1.16 A key benefit of mutual recognition, identified in a number of submissions, was improved communication between registration boards in different jurisdictions.
5.1.17 The Medical Board of the Australian Capital Territory stated that:
"This Board is particularly happy with the provisions of the legislation which permit increased exchange of information between registration authorities as it permits the Board, where necessary, to protect the public from unscrupulous and unqualified medical practitioners."
5.1.18 In addition, the Australian Nursing Council stated that:
"one benefit has been an improved communication system between each nurse regulatory jurisdiction."
5.1.19 Improved communication between registration authorities is a significant benefit arising from the MRA. A number of issues raised in the course of the review emanate from differences in registration requirements between jurisdictions. Greater communication between registration authorities is a pre-requisite for addressing such concerns. The review group considers that registration authorities should establish formal communication arrangements with a view to addressing issues that may arise, in particular, those issues relating to differences in registration requirements and the impact of such differences on registration under mutual recognition.
Recommendation 7
That occupational registration authorities put in place formal mechanisms for inter-jurisdictional communication and cooperation to establish a forum in which issues relating to mutual recognition can be discussed and resolved.
5.2 Other issues raised in submissions
5.2.1 While the MRA appears to be operating successfully, a number of issues were raised in submissions.
Lack of national consistency in registration requirements
5.2.2 Mutual recognition has the potential to highlight differences in registration requirements between jurisdictions. A number of issues raised in submissions indicated a lack of national consistency in registration requirements among jurisdictions. This highlights an apparent lack of rigorous analysis in policy decisions by governments to intervene in occupational markets, through the establishment of statutory registration schemes. The underlying concern about different registration requirements among jurisdictions was highlighted by the Australian Institute of Building Surveyors which stated that:
"As an accreditation body, we have been challenged by the vast differences in education and experience requirements to become a practising Building Surveyor in each of the States."
5.2.3 The Chiropractors and Osteopaths Board of Queensland also stated that the outcome of:
"the absence of an agreed national standard is that some jurisdictions have lower standards."
The 'lowest common denominator' effect
5.2.4 A key issue raised was the so called "lowest common denominator" issue. It is claimed that an outcome of mutual recognition is that "those jurisdictions with the most lenient registration requirements effectively set the benchmark for other jurisdictions and that requirements elsewhere are undermined because of the lowest common denominator effect."
Recency of practise
5.2.5 An example of differences in registration requirements between jurisdictions relates to recency of practise. Recency of practise relates to the allowable period between when a person last practised in an occupation and when that person seeks registration.
5.2.6 The Australian Council of Physiotherapy Regulating Authorities referred to:
"the inconsistency between Physiotherapy Acts in the various States as to the requirements for recency of practice (or a demonstration of individual competence where this does not exist) prior to registration being granted. With Mutual Recognition, a second State which might normally demand recency of practice is obliged to register a physiotherapist registered in the first State where such a requirement does not exist. While all Boards would like to have a recency of practice provision in their Acts, this has not been possible to achieve to date."
5.2.7 Noting that physiotherapist registration requirements in Western Australia will, in all probability, include similar provisions to those currently in the Nurses Act, the Physiotherapists Registration Board of Western Australia stated that:
"Nurses registered in NSW are not required to [have] practiced as a nurse within the past 5 years in order to remain on the NSW register, raising the possibility that a nurse, registered in NSW but not having practiced as a nurse for say 10 years, could apply for registration in WA under mutual recognition and the Nurses Board would be obliged to register that nurse because he/she was registered in NSW."
5.2.8 The principal justification for imposing recency of practice requirements is the protection of public health and safety. Whilst one might expect those jurisdictions which impose no recency of practice requirements to evidence adverse effects on public health and safety, the Review was not presented with evidence to support that proposition. If such evidence exists, the matter of the appropriate level of standards could be referred to the relevant Ministerial Council as provided for under the MRA, and Minister's may wish to agree to nationally uniform requirements.
5.2.9 Certain occupations can be employed in a variety of different situations. For example, nurses are employed in hospitals, aged care facilities and numerous other settings. The benefits of recent practice will vary depending on the employment situation. If recency of practice is a significant issue, it could be expected that employers would take this into account when assessing the suitability of potential employees. In light of this additional level of scrutiny, it is not clear that recency of practice (as a feature of registration requirements) is a particularly useful way of measuring competency or matching competencies with job requirements.
Knowledge of local law
5.2.10 Some submissions indicated that a lack of knowledge about local law and conditions could lead to a lowering of standards. The main concern was that mutual recognition assumes that the skills required by one jurisdiction are sufficient to practice that occupation anywhere in Australia.
5.2.11 The Real Estate and Business Agents Supervisory Board and the Settlement Agents Supervisory Board of Western Australia submitted that:
"All real estate agents and settlement agents registered in Western Australia are required to know local law and systems so it should not be considered onerous to expect the same standard for mutual recognition applicants. The public expects the Boards to allow only competent participants in the marketplace so they are not placed at risk. An agent who is unfamiliar with our titles, contracts and local requirements could not be considered competent."
5.2.12 This was supported by the Australian Institute of Building Surveyors submission which stated that:
"the legislation may need to recognise that some States have different practices or expectations and therefore until these are resolved some restrictions of trade/practice may be appropriate."
5.2.13 Mutual recognition assumes that people are able to obtain registration in a particular occupation because they have the skills and competencies to practice that occupation in a range of settings. The training and qualifications involved in developing the skills to practice occupations such as real estate agents, lawyers and other occupations, give trained individuals the ability to understand and interpret the legal and other requirements needed to carry out their occupation. The ability to familiarise one's self with the particular requirements of a jurisdiction that bear on the practice of an occupation could be expected to be a part of the competencies held by persons trained in occupations where such skills are relevant. If this were not the case, changes to laws and other requirements, which occur on a reasonably regular basis, would quickly render a person's skills and/or knowledge out of date. The review group was not convinced that this issue represented a significant shortcoming in the way the MRA works or that any changes to the scheme were warranted.
Jurisdiction shopping
5.2.14 A number of submissions suggested that the lack of consistency in registration requirements between jurisdictions has resulted in 'jurisdiction shopping' where individuals seek out the jurisdiction with the lowest registration requirements and then use mutual recognition to obtain registration in other jurisdictions where requirements are more stringent.
5.2.15 The Chiropractors and Osteopaths Board of Queensland stated that it was aware of instances where individuals have:
"been able to apply under the scheme to obtain registration, but would have been denied registration previously on the grounds that ... qualifications were insufficient."
5.2.16 This view was confirmed by the Australian Institute of Building Surveyors which stated that:
"Recently, ... we have had practitioners refused accreditation in one State and go to another State and be accredited, then return to the original State under the umbrella of mutual recognition seeking acceptance."
The Institute indicated that it:
"wondered if we have created legislation that is unintentionally supporting the lowest common denominator."
5.2.17 The Australian Council of Professions stated that, while the scheme was working well, the one exception was:
"the tendency inherent in a scheme of this nature to promote a 'lowest common denominator' approach to professional standards, registration and training. It has been suggested to the Council that there is little incentive for Registration Boards and training bodies to seek improvement when individuals are able to seek out the 'easiest' registration route and then utilise mutual recognition arrangements to locate themselves elsewhere."
5.2.18 The Australian Building Codes Board suggested that:
"mutual recognition legislation ... becomes problematic because any differences in qualification (either formal educational pre-requisites or on the job experience) may not be relevant. This may result in a situation where the lowest common denominator, in terms of practitioner registration, becomes the norm. A building surveyor registered in New South Wales, where there are no statutory educational pre-requisites, may, for example, obtain registration as a building surveyor in Victoria, where educational pre-requisites are more stringent..."
5.2.19 While according to the Australian Medical Council:
"There have been a number of instances where an individual practitioner used mutual recognition to circumvent existing registration provisions or conditions imposed on their registration.
The problem arises where a practitioner held registration in two States (one of which was unconditional registration but the other was conditional and required the practitioner to complete a period of supervised training) and where mutual recognition was used to 're-apply' for registration in the second State on the basis of the unconditional registration in the first State."
5.2.20 The Osteopaths Registration Board of Victoria highlighted the impact of mutual recognition when jurisdictions had different requirements for persons trained overseas, stating that it had concerns with an arrangement which:
"potentially allows the registration of overseas qualifications in certain States and thereby using Mutual Recognition to gain registration in another State where that qualification on its own merits would not either be acceptable or registrable."
5.2.21 Although some occupations have concerns about the so-called lowest common denominator effect, it is evident that the normal registration arrangements between States have some shortcomings. For example, the Australian Medical Council provided an interesting example of circumstances in which stricter information requirements under the MRA has resulted in individuals purposely not using the scheme in order to take advantage of more lenient provisions under normal registration requirements. The Council stated that:
"Because medical practitioners are aware of provisions in the mutual recognition legislation for the exchange of information between States, they avoid using mutual recognition when applying to practice in another State. Since they are applying under the local Medical (Practitioners) Act they are not required to certify that they are not subject to any conditions. The objective being to obtain registration without conditions in another jurisdiction on the basis of their primary qualifications and avoid conditions imposed in the first State."
5.2.22 The lowest common denominator issue highlights the benefits of a reasonable degree of national consistency among jurisdictions in respect of registration requirements. The benefits of a national consistency in registration requirements in an environment of mutual recognition was confirmed by the Royal College of Nursing which stated that:
"The development of national minimum standards in the form of nursing competencies for initial entry to practice, re-entry to practice and overseas nurses seeking registration were a positive forerunner to the implementation of the Mutual Recognition Agreement."
5.2.23 The review group considers that registration authorities which have concerns about the registration requirements of other jurisdictions should make greater use of the referral mechanism contained in the MRA. Under this mechanism, a jurisdiction may refer to the relevant Ministerial Council the matter of the appropriate competency standards underpinning registration of a particular occupation within another jurisdiction. Within 12 months of receiving a referral, the Ministerial Council is required to determine whether agreed standards should apply to the occupation and, if so, what those standards should be. This could result in the development of new uniform standards which all jurisdictions would adopt or an agreed minimum level of standards which may require one or more jurisdictions to amend their requirements in order to meet the minimum standards.
Recommendation 8
That jurisdictions make greater use of the referral mechanism contained in the MRA where concerns exist as to the competency of persons registered in other jurisdictions.
'Equivalence' between occupations
5.2.24 One inconsistency in the approach to occupational regulation by jurisdictions is the lack of 'equivalence' for occupations in different States and Territories. Equivalence has a particular meaning in the context of mutual recognition. It relates to similarity in the types of activities a person can carry out under their registration. The Mutual Recognition Act (s.29(1)) defines equivalence as existing:
"when the activities authorised to be carried out under each registration are substantially the same (whether or not this result is achieved by means of the imposition of conditions)."
5.2.25 The issue of equivalence was highlighted by the South Australian Government submission, referring to the comment of the Office of Consumer and Business Affairs (OCBA) that:
"OCBA also expresses concern over the mutual recognition by SA of WA settlement agents and NT conveyancing agents, as these two groups do not draft their own documents and their work does not include commercial property and its components. To date OCBA has not had to refuse any applications received from WA or NT agents, but it is anticipated that this situation could change."
5.2.26 The South Australian Branch of the Australian Dental Association provided an example of a problem which it could face in the future, stating that:
"A Dental Therapist in Western Australia was granted Hygienist registration in WA and immediately shifted to Victoria where she successfully applied for registration as a Hygienist in that State. This has set a precedent for a situation in which there are doubts about the education and training of a Dental Therapist in WA to perform Hygienist duties."
5.2.27 The Chiropractors Board of South Australia stated that:
"The Queensland Registration Board registers all persons as chiropractors and osteopaths albeit a person may not have [both] chiropractic [and] osteopathic qualifications. For example, a chiropractor when registered as a chiropractor and osteopath in Queensland is then entitled to apply to any other State/Territory for registration as an osteopath even though that person does not hold any osteopathic qualifications."
5.2.28 The Chiropractors and Osteopaths Board of Queensland confirmed this situation stating that it:
"administers two professions: chiropractors and osteopaths. Registration for an applicant accords the applicant the title 'Chiropractor and Osteopath'. This has the consequence that a registrant in Queensland is entitled under the Mutual Recognition Scheme to register as an 'Osteopath' or 'Chiropractor' in those States where an applicant is registered as only either a 'Chiropractor' or an 'Osteopath'. Under the scheme, for example, a person who is qualified in chiropractic and who has registered in Queensland as a chiropractor and osteopath could be registered in another State solely as an 'Osteopath'."
5.2.29 The above example highlights the lack of rigorous analysis which often underpins policies for occupational regulation. Apart from the mutual recognition issues and the impact of Queensland's joint chiropractic and osteopathic registration regime, the current arrangements raise issues for the Queensland Registration Board. If the disciplines of chiropractor and osteopath are as different as is contended, serious questions must be asked about the existing joint registration approach if it allows osteopaths with no training in chiropractic to treat patients with chiropractic techniques and vice versa. The Queensland Board clearly recognises the source of the problem, stating that:
"To some extent this problem arises from the Chiropractors and Osteopaths Act of Queensland. Attempts by the Board and others to change the regime have not met with any success."
5.2.30 Most concerns about equivalence are adequately addressed by the mutual recognition scheme. The MRA allows for conditions to be placed on registration where issues of lack of equivalence arise. For example, section 29(2) of the Mutual Recognition (Commonwealth) Act 1992 states that:
"Conditions may be imposed on registration .... so as to achieve equivalence between occupations in different States."
5.2.31 This provision would appear to generally deal with the issues raised in respect of settlement agents and dental therapists. However, the ability of the scheme's equivalence provisions to deal with the issues raised by Queensland's registration of osteopaths and chiropractors is less clear.
5.2.32 It would appear to be the case that if a person with qualifications in osteopathy that was registered in, say, South Australia, sought registration in Queensland as an osteopath and chiropractor, the Queensland Board could apply conditions on the person's registration such that they could practice as an osteopath but not as a chiropractor. Under the terms of the MRA, however, similar restrictions could not be applied in the reverse situation. That is, a Queensland practitioner registered as an osteopath and chiropractor could, in principle, obtain separate registration for both occupations in another jurisdiction even though they were only qualified to practice one of the occupations.
5.2.33 Such joint registration of two distinct occupations is uncommon. In the Review Group's view, the issues raised in this context do not constitute a significant shortcoming of the mutual recognition scheme. There is a question, however, of the merit of the approach taken to registration of these occupations in Queensland.
Impact of National Competition Policy reforms
5.2.34 A number of submissions suggested that individual State and Territory legislation reviews conducted under the National Competition Policy (NCP) reforms had resulted in greater inconsistency between jurisdictions. In effect, if a jurisdiction were to remove registration as a result of an NCP review when other jurisdictions retained it, it could create a 'partially registered occupation', which is inconsistent with MRA.
5.2.35 The Australian Veterinary Association stated that:
"Because [reviews of State Veterinary Surgeons' Acts] are not carried out at the national level these State and Territory reviews will lead to differences in legislation across the country at a time when mobility of professionals and the global market demand greater uniformity. They will negate the gains made under the Mutual Recognition Agreement.
The principal concern with the process was that each State is undertaking its own review in its own way and there are no common terms of reference."
5.2.36 The Australian Physiotherapy Association indicated that it had:
"become increasingly concerned about the fragmented and disparate approaches being taken by State Governments as they review their Registration Acts in the context of the Agreements to implement a National Competition Policy. Instead of the Registration Acts being reviewed on a national basis, each State and Territory is or will be proceeding individually with little apparent consultation with each other.
The APA believes that if no action is taken to apply a national perspective the outcomes from the legislation review process have the potential to destabilise and undermine mutual recognition."
5.2.37 The Australian Council of Professions stated that:
"the Council would wish to underline the importance of recognising the inter-relationships and the scope for inconsistencies between the pursuit of policy outcomes in respect of the Mutual Recognition Scheme on the one hand and those of the National Competition Policy on the other. There is already evidence that the manner in which the legislative reviews are being undertaken for competition purposes is undermining the mutual recognition process, giving rise to untoward and undesirable consequences in both international and domestic terms."
5.2.38 This view was supported by the Institute of Engineers, Australia which stated that it was imperative:
"that the benefits from the Agreement are not eroded by other government policy initiatives, such as implementation of the National Competition Policy.
The risk arises basically because the States and Territories are reviewing the legislation dealing with professional practice in isolation.
Either national reviews should be undertaken of Acts which have mutual recognition implications, or alternatively, if the review results in changes, there should be an over-riding requirement that any proposed changes not disrupt the existing mutual recognition agreements."
5.2.39 The Review notes the concerns that national consistency of registration requirements can potentially be adversely affected by separate reviews of occupations being conducted under the auspices of the NCP reforms. Governments are encouraged to consider the merits of conducting national competition reviews of occupations where appropriate. The Working Group notes that CRR is examining this issue separately.
Recommendation 9
That governments should consider greater use of national competition reviews of occupations where appropriate to reduce the prospects of increasing inconsistency in regulation which reduces mobility of occupations between jurisdictions.
Recommendation 10
In carrying out individual State or Territory National Competition Policy reviews, governments should consider the impact of their recommendations on the mobility of persons in registered occupations under the MRA.
5.3 Mutual recognition has promoted national consistency
5.3.1 In contrast to the concerns raised about the adverse impact of inconsistent registration requirements between jurisdictions, numerous submissions indicated that mutual recognition was leading to the development of national standards and greater consistency between jurisdictions.
5.3.2 The Veterinary Surgeons Board of the Australian Capital Territory stated that:
"The introduction of mutual recognition has increased awareness of the differences between State/Territory legislation, procedures and standards and subsequently there is increased pressure from the profession for uniformity and national registration."
5.3.3 This view was supported by the Dental Technicians and Dental Prosthetists Board of the ACT which stated that mutual recognition:
"has encouraged communication between regulating authorities and professional associations nationally and there has been an increase in commitment towards uniformity in legislation, training and administrative procedures."
5.3.4 In addition, the Australian Physiotherapy Association stated that:
"Mutual Recognition has been an important factor in achieving consistency in registration requirements in all States and Territories which has been beneficial to members of the profession and the community generally."
5.3.5 According to the Australian Veterinary Association:
"Veterinary Surgeons Boards meet annually as the Australian Veterinary Boards Conference to develop national approaches and uniformity. There are now moves to develop the Conference into a constituted body to improve communications and to develop national guidelines for registration.
[Mutual recognition] facilitates moves to national standards and adoption of international standards".
5.3.6 The Teachers Registration Board of South Australia confirmed this view stating that:
"the effect of the legislation and debate surrounding it has compelled forwards discussion and debate on National Standards generally and between the two State Registration Authorities (SA and Qld), New Zealand, the Victorian Registration Board (Independent Sector), the Standards Council of Victoria and a number of employing authorities around Australia and better cooperation has ensued for the benefit of the profession."
5.3.7 The Physiotherapists Registration Board of the ACT also stated that:
"Since the implementation of mutual recognition the Physiotherapists Boards have been increasingly aware of the needs for nationally uniform competency standards and registration.
The mutual recognition process highlights the need for communication between the State Physiotherapy Registration Boards on the topic of uniform national legislation, particularly as State Acts come under review."
5.3.8 The Royal College of Nursing suggested that the scheme had also encouraged greater coordination in the area of professional training stating that:
Top"It gives an impetus for achieving a national approach to professional issues, particularly the educational preparation of nurses."
5.4 Other issues
Fraudulent applications
5.4.1 A number of submissions suggested that there was a possibility that fraudulent applications for registration could be made under mutual recognition.
5.4.2 The Physiotherapists Registration Board of Western Australia expressed:
"concerns that there is no requirement in the current legislation to positively identify applicants for registration via the mutual recognition process. Providing they complete the application form in the presence of a Justice of the Peace, they are not required to produce any form of identification whatsoever, which could ultimately result in fraudulent applications being accepted."
5.4.3 The South Australian Psychological Board stated that:
"The identity of persons applying under the Mutual Recognition Act is of concern to the Board. An unregistered person may assume a registered person's name from another State, complete the Mutual Recognition forms and be registered in the other State.
The time will come when unscrupulous persons will see this loophole and obtain registration fraudulently."
5.4.4 The Chiropractors Board of South Australia expressed similar concerns.
5.4.5 This issue does not appear to be one that arises from the operation of the MRA itself. Persons seeking registration under the scheme are required to verify any documentation and information provided when seeking registration, including their identity, with a statutory declaration. Statutory declarations need to be signed by a Justice of the Peace or others so authorised and are used to verify any number of legal and other documents. If there are problems with the legitimacy of statutory declarations, this has implications that are broader than the issue of registration under the MRA and which would be of significant concern to authorities. For example, if individuals could fraudulently use another person's registration documents to obtain registration, they could just as easily (or possibly more so) fraudulently use another person's qualifications to obtain registration directly, that is, not through the use of the MRA.
5.4.6 However, no evidence has been presented to the Review that statutory declarations are the subject of systematic abuse. Indeed, the submissions did not provide any evidence, even of an anecdotal nature, that fraudulent statutory declarations had been provided or that persons had fraudulently obtained registration under the scheme.
Business licensing
5.4.7 A number of submissions supported extending mutual recognition to business licensing.
5.4.8 The Institute of Engineers, Australia stated that:
"In manufacturing, information technology and professional services, as in many other fields, Australia has become an integral part of the global marketplace. The present absence of a consistent regulatory framework creates unnecessary obstacles for international investors wishing to set up operations in Australia.
For instance, a growing number of North American and European companies ... are looking to Australia as a possible business location. However, the fragmented regulatory approach by various levels of government of the key activities associated with these industries provides a very real disincentive to investment.
The continuation of mutual recognition, and expansion of the principles to business licensing and the use of goods, may help to alleviate the current disjointed and parochial approach by the Federal, State, Territory and local governments, and would be supported by the IEAust."
5.4.9 The Local Government Office of the Tasmanian Department of Premier and Cabinet stated that:
"The extension of this legislation to business licensing and the use of goods should also be thoroughly examined. The application of this legislation to these issues would rapidly accelerate the move to consistent State and Territory legislative requirements in many areas that need reform but have been retarded for various reasons."
5.4.10 According to the Australian Capital Territory Building, Electrical and Plumbing Control:
"For builders and electrical contractors the current licenses are already in effect business licenses. Although technical qualifications are among the prerequisites, business capacity is also considered and people cannot operate in the industry without a license. There have been problems recently because NSW now asks building contractors to operate as companies, which are not part of the MRA."
5.4.11 The Queensland Department of Transport provided significant information, including that:
"... the most significant areas for possible extension appear to be business licensing, regulation of services (particularly those that are provided across State and Territory borders), local government licensing, and areas of interstate and Commonwealth/State overlap."
The Department of Transport gave an example of where less formal mutual recognition arrangements have been put in place:
"For example, Queensland currently has in place arrangements for obtaining 'Operator Accreditation' as a tourist coach operator which are closely modelled on the NSW requirements. In consequence, NSW has put in place its own mutual recognition arrangement whereby a Queensland-accredited tourist coach operator can operate in NSW without obtaining separate accreditation."
However, the Department of Transport expressed concern that continuance of this and other similar arrangements was discretionary, stating that:
"these are generally not a situation analogous to the mutual recognition scheme in which the States and Territories have, in effect, ceded sovereignty to each other.
Rather, the existing administrative and/or legislative arrangements are discretionary measures which allow individual jurisdictions to allow for the mutual recognition of interstate licenses, inspections, certificates and other approvals. Generally, any jurisdiction is free to withdraw these arrangements at any time, without penalty."
The Department of Transport went on to describe how this situation had worked against other reform initiatives directed at lowering business costs:
"As part of Queensland's ongoing review of business 'red tape', a proposal was raised to simplify this State's Operator Accreditation standards. A major constraint to the adoption of this proposal was the concern that NSW would withdraw its recognition of Queensland operators, which would impose significant costs on the local industry."
5.4.12 The issue of linking occupational registration and business licensing in the context of mutual recognition was considered in the May 1993, Report of the Review of the Partially Registered Occupations, prepared by the Vocational Education, Employment and Training Committee (VEETAC) Working Party on Mutual Recognition. In its report, VEETAC defined a business license as:
"a form of regulation with requirements related to the running of a business such as insurance coverage, premises, etc. The essential aspects of business licenses do not deal with the qualifications, competence and experience of individuals."
5.4.13 Consistent with the definition used in the Mutual Recognition Act (Commonwealth) 1992, VEETAC defined occupational registration as:
"the licensing, approval, admission, certification (including by way of practising certificates), or any other form of authorisation, of a person required by, or under legislation, for the carrying on of an occupation."
5.4.14 In relation to the use of 'hybrid' licenses, that is, those which combine business licensing and occupational registration, the VEETAC Report recommended (Recommendation 3) that:
"Heads of Government agree that State and Territory jurisdictions amend any legislation, which requires a license holder to meet both business and occupational requirements, by removing the occupational requirements. Any occupational requirements associated with the delivery of a service by such a business license holder should be the subject of separate legislative provision where such registration is justifiable."
5.4.15 The Review Group supports VEETAC's call for business and occupational licensing to be separated. Combining such licenses unnecessarily restricts the business structures available to service providers. It prevents, for example, an unregistered person owning a business but employing a registered person to provide those services for which registration is required. Little justification exists for such restrictions which are potentially anti-competitive.
5.4.16 In responding to the VEETAC Report COAG has agreed that the Report's recommendations should be considered by jurisdictions when undertaking reviews of occupational registration and business licensing in the context of the National Competition Policy reforms. The Review Group supports this approach.
Recommendation 11
That when reviewing occupational registration and business licensing in the context of National Competition Policy reforms, governments should consider separating statutory requirements for occupational registration and business licensing, so as to not restrict the ownership of businesses to those registered to practise in the occupations which relate to the services provided by the business.
5.4.17 The Review Group also considers that there is merit in examining whether there is potential to extend the MRA to cover business licensing.
Recommendation 12
That the COAG Committee on Regulatory Reform examine the potential for the Mutual Recognition Agreement to be extended to cover business licenses.
5.5 Negative licensing
5.5.1 Some submissions raised concern about the impact of so-called negative licensing on the application of mutual recognition.
5.5.2 The South Australian Department of Premier and Cabinet submission of behalf of the Office of Consumer and Business Affairs (OCBA), stated that:
"Persons practising occupations that are negatively licensed in SA sometimes experience difficulty in being accepted as eligible for the granting of a licence or registration by other jurisdictions. ... OCBA considers that negatively licensed occupational groups such as land salespersons should still be entitled to be licensed under the principles of mutual recognition, provided they hold the necessary prescribed qualifications in SA and are not prevented from practising through suspension, disqualification etc."
5.5.3 Negative licensing is a light-handed form of occupational regulation which differs in a key respect from traditional forms of registration. Traditional registration usually involves the establishment of a registration board and statutory requirements which, among other things, usually require that practitioners hold a certain qualification. On presenting evidence that a person has such a qualification and meets other relevant criteria, he or she is granted registration. Recognition of such registration could be obtained in other jurisdictions under the MRA.
5.5.4 Negative licensing, on the other hand, often involves a statutory requirement that provides for anyone to practice a particular occupation as long as that person does not breach legislative requirements that relate to unacceptable or unsatisfactory conduct. The VEETAC report defined negative licensing as:
"legislation detailing what is not acceptable in the operation or activities of an occupation and providing sanctions for unsatisfactory conduct. Under these arrangements any individual may practise an occupation without first being registered."
5.5.5 The form of negative licensing used by South Australia for a number of their occupations, goes further than detailing unacceptable conduct and providing for sanctions. For example, legislation regulating land economists restricts practice to those possessing a certain qualification. This creates a regulatory form different from that of negative licensing, which is effectively a form of de facto registration. More widespread use of these extended forms of negative licensing could potentially impact adversely on the mobility currently available under the MRA.
5.5.6 While the requirements to practice may be identical under both traditional registration and negative licensing, the latter does not involve the establishment of a registration board, the pre-assessment of eligibility to practice or the granting of a registration certificate or similar instrument. Persons licensed under such arrangements are not registered as such or in possession of a certificate of registration which can be used for mutual recognition purposes.
5.5.7 The Local Government Office of the Tasmanian Department of Premier and Cabinet raised similar concerns indicating that:
"There is a problem in Tasmania with respect to Registration of Builders. This Government does not wish to register builders in any statutory registration scheme. Therefore a Tasmanian builder is at a disadvantage because most other jurisdictions do register builders. It has proven to be very difficult for Tasmanian builders to become registered in another State because they do not have that base accreditation in the home State.
The Government is looking to the Tasmanian Building Industry to develop a voluntary accreditation/registration scheme along the lines of the National Professional Engineers Register or the Building Surveyors and Allied Professions Accreditation Board schemes. The question arises whether if that voluntary scheme was recognised by the Government (not required), would that accreditation/registration be sufficient base to request mutual recognition in another State? If not, should it be? Given the somewhat competing direction of National Competition Policy, consideration should be given to mutual recognition of 'recognised' voluntary schemes."
5.5.8 For various reasons, governments are moving towards more light-handed forms of regulation in some areas where appropriate. This is consistent with reduction of "Red Tape". Occupational registration is one such area, particularly in relation to occupations which do not provide services likely to impact on public health, safety or the environment. In the absence of these considerations, the justification for heavy-handed regulation is less clear and often relates to issues such as consumer protection. However, consumer protection issues are often dealt with through other forms of regulation, for example, fair trading and trade practices laws.
5.5.9 Another form of light-handed regulation is co-regulation where governments may endorse, usually by legislation, a private organisation, for example, a professional association which is responsible for regulating the conduct and standards of its members.
5.5.10 Many forms of negative licensing and co-regulation differ little from traditional forms of registration in their practical effect on the requirements placed on individuals in order for them to be able to practice an occupation. However, the ability for persons regulated under these different approaches to access the mobility provided by mutual recognition can vary significantly. In many cases, those regulated by negative licensing or co-regulation schemes are not able to obtain the right to practice in other jurisdictions under the MRA.
5.5.11 The Review Group believes the reduction in mobility arising from moves to various forms of light-handed occupational registration has the potential to undermine the benefits of mutual recognition. It considers that governments should consider extending the MRA to include non-traditional forms of statutory-based occupational regulation.
Recommendation 13
That the COAG Committee on Regulatory Reform examine the potential to extend the Mutual Recognition Agreement to cover non-traditional, statutory-based forms of occupational regulation such as negative licensing and co-regulation.
5.6 Conclusions
5.6.1 On balance, the MRA appears to be working well for most occupations and is achieving the objectives of removing barriers to movement of skilled service providers between jurisdictions.
5.6.2 The key issue raised in submissions was the so-called lowest common denominator effect, however, the Review Group found that this issue does not constitute a significant problem with the MRA. This effect occurs due to different registration requirements among the States and Territories. Concerns with this effect come only from jurisdictions which consider that their requirements are higher or more stringent than those in other jurisdictions. However, the Review Group was not convinced that, in many cases, the need for occupational regulation is based on rigorous analysis of the costs and benefits to the community of registration, let alone the precise level of requirements for registration in a particular occupation. No evidence has been presented that the risk to the community is greater in jurisdictions which have requirements regarded by other jurisdictions as 'too low'. Given that the costs and benefits of registration could be expected to be broadly equivalent between jurisdictions, it is not clear whether, in some cases, registration requirements are unjustifiably stringent and that there would not be net benefits to the community in lowering requirements in some occupations.
5.6.3 To the extent that such concerns do exist, they arise from a lack of national consistency in respect of registration requirements. The experience of some occupations (for example, nurses, veterinarians and physiotherapists) demonstrates that mutual recognition can be used as force to encourage greater national consistency. Greater national consistency has been encouraged through various reform mechanisms, including regulatory reviews, NCP, and the VEETAC Review on Partially Registered Occupations. It is open for other occupations to seek to put in place more consistent arrangements, and the Review Group supports and encourages registration authorities to consider this course of action.