- Media Releases
- Proposed Policy - Diversification Leases
- Frequently Asked Questions
- General FAQ
- New Diversification Lease
- Streamlining land tenure approvals and projects - Administrative and general
- Streamlining land tenure approvals and projects - Reserves
- Streamlining land tenure approvals and projects - Roads
- Streamlining land tenure approvals and projects - Easements
- Pastoral Leases
- Consultation Draft
- Proposed Amendments to the Land Administration Act 1997
- Land and Public Works Legislation Amendment Bill 2022 presentations
Amendments to the LAA were introduced into Parliament on Wednesday 23 November 2022. The amendments will provide an opportunity for pastoralists, native title parties and others to get involved in the growing renewables market, which includes carbon farming, hydrogen, and wind and solar markets, through diversification. The changes will enable the extension of pastoral leases terms to 50 years, providing greater certainty of tenure and allowing for investment in diversified land uses such as carbon sequestration. The State Government is also making the calculation of rent for pastoral leases more transparent and predictable.
For further information, please email LAA2022@dplh.wa.gov.au
Proposed Policy - Diversification Leases
A draft Policy Framework Guiding the Use of Diversification Leases on Crown Land has been produced by the Department.
Frequently Asked Questions
General FAQShow more
What is the Land Administration Act (1997) and why does it need to be amended?
The Land Administration Act 1997 (LAA) is the legislation that governs Crown land, which covers 92% of the State’s land mass, including pastoral leases, national parks, and Aboriginal reserves. Amendments to the LAA will introduce a series of changes to reduce red tape and prepare the WA economy to reach net zero emissions by 2050 with the implementation of a range of new measures.
The ability to diversify and broaden the Western Australian economy requires the introduction of a new form of land tenure into the LAA. It is proposed that this new tenure will be non-exclusive leasehold tenure that can be applied over large areas of Crown land to provide a lessee with the right to undertake activities on the land without creating ‘private land’ that excludes access by other parties such as resource companies, and native title holders.
When it commenced in 1998, the LAA was innovative and replaced several outdated land statutes. However, it has been recognised for some time that there are ambiguities and inefficiencies in the practical application of the Act. These amendments are needed to reduce red tape and provide faster and more diverse access to Crown land, reducing costs for land related projects for industry and government.
In addition, in 2017, the Auditor General issued the Management of Pastoral Lands in Western Australia report in which he recommended reforms to the administration of pastoral land. Reforms were designed to improve land condition monitoring and encourage good land management practices through the introduction of a voluntary land management accreditation system, greater security of tenure and measures aimed at encouraging diversification and development of complementary activities.
What are the proposed amendments to the LAA?
The proposed amendments to the Land Administration Act 1997 are designed to remove constraints to Crown land-based developments throughout Western Australia, create economic growth and development through diversified land use, and facilitate best-practice land management and more effective administration of the pastoral estate. The Act will be modernised, allowing for approvals for land tenure and projects requiring Crown land to be streamlined; introducing a new form of broadscale tenure suitable for a diverse range of land uses; and improve the way in which pastoral land is administered.
How will this contribute to the State’s net zero by 2050 policy?
Western Australia (WA) has attributes that provide a strong competitive advantage in the growing global renewable hydrogen market including world-class wind and solar energy resources and vast areas of land with low population density, much of which is Crown land. Global demand for clean energy is increasing and hydrogen produced from renewable energy sources is an emerging technology that represents a considerable opportunity for the State to transition the industrial and resource sectors to cleaner production, reduce reliance on fossil fuels to power remote communities, while at the same time establishing a diversified and resilient economy that creates new long-term job opportunities. The new diversification lease will provide a form of tenure that can support the establishment of clean energy projects and the expansion of carbon farming to take much greater advantage of the burgeoning market for carbon emissions offsets.
What does this mean for diversifying the Western Australian economy?
Diversification leases, the new form of flexible broadscale tenure proposed, will allow the State to support industry efforts to grow the renewable energy industry in Western Australia. In addition, more diversified uses across areas of the State which, for various reasons, are no longer viable for traditional pastoralism will allow opportunities for further economic growth. This will contribute to a more diversified economy that benefits all Western Australians.
In addition, the State Government has recently announced the single biggest investment in reducing red tape and streamlining government approvals processes in its history. Amendments to modernise the Land Administration Act and the Public Works Act are required to fix administrative inefficiencies and get the billions of dollars’ worth of capital projects required to meet future community and business needs underway.
What opportunities will this create for native title parties?
The diversification lease will provide an additional tenure option for native title parties and other Aboriginal stakeholders that does not exist at present. Such leases can be granted over large areas, for multiple purposes, and do not require the surrender of native title.
In addition, where native title has been determined to exist or may exist, any act that may affect the rights of native title parties is a future act under the Native Title Act 1993 (Cth). This includes the grant of tenure and the extension of the terms of pastoral leases. For a grant or extension to be valid, a future act process under the Native Title Act will be required. This is most likely to be the negotiation of an Indigenous Land Use Agreement with the native title parties, who will be in a position to negotiate outcomes that will be most beneficial to their particular circumstances and goals. This may include employment, planning for healthy country, capacity building, business opportunities and social and cultural development.
What does this mean for WA pastoralists and the pastoral industry?
The amendments will provide a range of opportunities to the pastoral industry, and to individual pastoralists. The ability for the Minister for Lands to extend the term of a pastoral lease up to 50 years will provide a significant benefit, allowing for better long-term planning and management of the land under the lease, and providing a better return on investment for infrastructure and other land management actions. Further, the ability to extend pastoral lease terms will provide lessees holding short-term leases with the opportunity to establish carbon farming projects on pastoral leases. In areas where native title has been determined to exist or may exist, the appropriate future act process under the Native Title Act 1993 (Cth) will need to be completed before the extension of the term of a lease could be granted. In practice, the State will require an Indigenous Land Use Agreement (ILUA) to be negotiated with native title parties.
In addition, diversification permits will be able to be transferred at the same time as the underlying pastoral lease, subject to compliance. By providing clarity and reducing uncertainty, this measure will encourage investment in diversified activity under permit. In addition, it provides both the seller and the purchaser with economic benefits – the seller will be able to realise the full value of the land under permit, while the purchaser obtains certainty about the types of activities that may be undertaken on the land.
Other proposed amendments seek to streamline and create greater efficiencies for pastoral businesses. For example, pastoral lessees will no longer be required to seek permission from the Pastoral Lands Board before agisting livestock that belongs to third parties. Also, the date for annual returns is changing to better align with pastoralists’ business requirements, during a time of year when there are fewer stock movements.
The permit approval process is being streamlined to reduce red tape and prevent unnecessary delays. A permit will be able to be amended, with the lessee being able to request that a change be made, and the Pastoral Lands Board will be able to consider the request without having to reapply the approvals processes to the existing components of the permit.
Many pastoral lessees, particularly in the Southern Rangelands are changing their business models in response to factors such as climate change. Pastoral lease holders, especially those in the Southern Rangelands, are increasingly moving into non-pastoral activities to future proof their businesses. A diversification lease provides an opportunity for pastoralists who wish to adopt a more diverse business model to surrender part, or all, of their pastoral lease and switch to a diversification lease. However, there is no obligation for a pastoral lessee to surrender their lease in favour of a diversification lease.
What are the proposed changes to pastoral rents?
The current rent determination methodology will be replaced with one based on the Consumer Price Index (CPI), with market reviews every ten years rather than every five years as is currently the case. Rent models based on CPI are commonly used for commercial leases and will often improve the transparency and predictability of the system. It is anticipated that a CPI model will help reduce the volatility inherent in the current pastoral lease rent determination mechanism, enabling pastoral businesses to conduct long-term financial planning.
The amendments will also give the Minister more flexibility in relation to rent relief. At present, the Minister has powers to grant rent relief to pastoral lessees on an individual basis, following an application process and recommendation from the Pastoral Lands Board. However, this is not always practical or efficient, for instance where a group of pastoral lessees are affected by the same natural disaster or economic adversity. In the future, the Minister in consultation with the Pastoral Lands Board will have the ability to provide rent relief to a class of lessees without necessarily having to first require individual applications.
What does this mean for conservation organisations?
The new diversification lease will provide tenure for a private conservation purpose. However, prior to the grant of a diversification lease for conservation purposes, the lessee will be required to submit a business case establishing their financial and business capacity and capability to undertake the activities for the requested term of the lease. The lessee will also be required to actively manage the land including controlling declared pests, such as weeds, wild dogs and other feral animals.
In addition, the grant of a diversification lease will be subject to the approvals process applicable to the grant of all tenure including referrals for comment to the Department of Mines, Industry Regulation and Safety, Department of Water and Environmental Regulation, local government and other relevant agencies.
In areas where native title has been determined to exist or may exist, the appropriate future act process under the Native Title Act 1993 (Cth) will need to be completed before a diversification lease could be granted.
Who can I speak to if I have a question?
If you have further questions, please email LAA2022@dplh.wa.gov.au
New Diversification LeaseShow more
What is this new diversification lease and how will it be used?
A diversification lease will provide a land tenure option in Western Australia that does not currently exist. It is designed for broadscale and non-exclusive land use, like a pastoral lease, but will not restrict land use to a particular activity in the way that a pastoral lease does.
The permitted use of the land under a pastoral lease is set out in the Land Administration Act 1997 and does not have flexibility. In contrast, the permitted uses of the land under a diversification lease will be set out in the lease as agreed by the parties, and so is flexible.
- A diversification lease is designed for broadscale uses such as:
- carbon farming
- multiple concurrent uses – e.g. grazing livestock, horticulture, agriculture, tourism, carbon farming
- Aboriginal economic development and land management
- environmental offsets for mining companies or where their activities are substantially inconsistent with existing pastoral uses
- conservation purposes
- renewable energy
- diversification use in conjunction with off-lease activities
A diversification lease will not enable use of the land to the exclusion of all others. Native title rights and interests will not be extinguished for the grant of a diversification lease.
A diversification lease will coexist with mining rights in a similar way as pastoral leases, so that mining tenement holders will have a right of access to the land.
Could any person, including a pastoral lessee, apply to establish a new pastoral lease or a diversification lease on unallocated Crown land?
Yes. Any person may apply to the Minister for Lands for a new pastoral lease or the proposed diversification lease, or any other form of tenure on unallocated Crown land. Any application will be considered on its merits and be subject to providing all relevant information such as a business case or proof of experience in a particular field.
Unlike pastoral leases, there will be no specific requirement to publicly offer diversification leases. Instead, the process for identifying suitable proponents will be at the Minister’s discretion. For example, the Minister may require a public offering, call for expressions of interest or require some other competitive process to be undertaken, if the circumstances of the particular case warrant it. This may include, for example, if there are a number of competing parties who are all interested in a particular area of land for the grant of a diversification lease.
Will it be compulsory for a pastoral lessee to ‘convert’ its pastoral lease to the new diversification lease?
No. A diversification lease will be an option available to both pastoral lessees and new entrants or third parties. The decision to surrender part or all of a pastoral lease in favour of a diversification lease will be a business decision for the pastoral lessee. The Minister for Lands will determine on good public policy grounds whether to accept the surrender of the pastoral lease and grant of a diversification lease.
Any request to surrender only part of a pastoral lease for the grant of a diversification lease will require consideration of the viability of the remaining pastoral lease. This would be undertaken by the Pastoral Lands Board, who would provide their recommendation to the Minister for Lands, prior to the Minister determining whether to grant the diversification lease.
If one or more diversification permits have been issued in relation to a pastoral lease, will the pastoral lessee be required to ‘convert’ to a diversification lease?
No. A diversification lease will be an option available to both pastoral lessees and new entrant third parties. The decision to ‘convert’ a pastoral lease to a diversification lease will be a business decision for the pastoral lessee, and then for the Minister for Lands to decide on good public policy grounds whether to allow it to be converted.
However, in cases where a pastoral lessee proposes to increase the scale of activities that are currently allowed under a diversification permit to such a degree that they could no longer be permitted under that permit, then more appropriate alternative tenure would need to be sought. This may include a diversification lease, a section 79 lease or other form of tenure.
Any request to surrender only part of a pastoral lease for the grant of a diversification lease would require consideration of the viability of the remaining pastoral lease. This would be undertaken by the Pastoral Lands Board, who would provide their recommendation to the Minister for Lands, prior to the Minister determining whether to allow grant of the diversification lease.
In addition, the appropriate future act process under the Native Title Act 1993 (Cth) will need to be completed before a diversification lease could be granted. This is most likely to be the negotiation of an Indigenous Land Use Agreement (ILUA) with the native title holders or claimants.
In the case that a pastoralist did not take up a diversification lease, would the diversification permit system remain the same as it is now, i.e. will sections 118-122A still apply)?
Yes, the permit regime in Division 5 of Part 7 of the Land Administration Act 1997, including sections 118-122A, will continue to apply to pastoral leases.
Has any thought been given to amending and streamlining the processes for obtaining a diversification permit?
The proposed amendments to Part 7 of the Land Administration Act 1997 include a number of proposals aimed at streamlining permit processes. This includes removing potentially circular requirements in section 117 by allowing the Pastoral Lands Board (PLB) to issue a diversification permit subject to requirements of environmental conservation legislation being met, instead of the current requirement that those requirements must be completed before a permit may be issued. In addition, the PLB will be able to amend existing permits at the request of a pastoral lessee, for example, to add a plant species to a permit for agricultural activities which will result in a more streamlined process for pastoralists. Finally, the proposals introduce the ability to transfer diversification permits upon transfer of the underlying lease.
In the case that a pastoralist did take up a diversification lease, would they still require a diversification permit to undertake activities such as irrigated agriculture using non-indigenous plants, or non-pastoral uses such as horticulture or aquaculture?
Part 7 of the Land Administration Act 1997, including the permit regime in Division 5, will not apply to diversification leases. Instead, any activities on a diversification lease will be authorised by means of the lease conditions. Consequently, the holder of a diversification lease would be able to conduct only activities authorised in the conditions of that lease.
In the case that a pastoralist has either a pastoral lease or a diversification lease, will there still be a requirement for excision to a section 79 lease for activities that are deemed to be non-pastoral, or that might wish to sublease or joint venture – an activity that would require a large amount of capital investment and that would require a greater degree of security from the bank to proceed?
The new diversification lease contemplates that areas of the land might have substantial structures built on it and which will be identified in the lease because, firstly those areas will require approval under section 16(3) of the Mining Act 1978 before the lease can be granted (plus the negotiation of an Indigenous Land Use Agreement with the relevant native title party), and secondly any changes to those areas or to the permitted uses during the currency of the lease will require further s16(3) Mining Act approval as well as the approval of the Minister for Lands.
It may well be that some proponents will prefer a section 79 lease for areas of intensive activity and for the less intensive activity, such as wind turbines, to be on a diversification lease. Given that pastoral leases are accepted by financial institutions as good security and diversification leases are very similar, we are anticipating that most financiers and proponents will be happy with the new tenure given that it will be able to be granted on a long-term basis if required.
If the lease remains a pastoral lease, then non-pastoral purposes will require either the grant of a diversification permit or excision of relevant areas from the pastoral lease and a section 79 lease or the new diversification lease granted over those areas.
What advantage will a diversification lease have over a pastoral lease or a section 79 (general) lease?
A diversification lease will not restrict land use to a particular activity in the way that a pastoral lease does. The permitted uses of the land under a diversification lease will be set out in the lease as agreed by the parties, and so is flexible.
The area of land under a diversification lease will generally be large (like a pastoral lease), as it is designed for broadscale uses. Consequently, there are likely to be good public policy reasons for an area of land of that size not to be locked up in a section 79 lease where the lessee has exclusive possession, and which is treated as ‘private land’ under the Mining Act.
The Minister for Mines must give his or her approval under the Mining Act 1978 before a new lease (whether it is a pastoral, section 79 or diversification lease) can be granted. In addition, in relation to a diversification lease, any change in the areas identified where substantial structures might be located such as where solar panel arrays are located) or in the uses permitted during the term of the lease, will require further approval from the Minister for Mines.
A section 79 lease confers exclusive possession of the land under lease; it is typically issued for high-intensity and high-investment activities on relatively small areas of land. The Minister for Mines may refuse to approve the grant of a section 79 lease over a large area of land, due to the consequential restrictions on mining on that land which flow from the Mining Act 1978.
In contrast, a diversification lease does not confer exclusive possession. Given that the major part of a diversification lease will be for less intensive broadscale use and allows for ongoing access to the land for mining purposes, the Minister for Mines may be more prepared to approve the grant of a diversification lease rather than a section 79 lease.
A diversification lease will coexist with mining rights in a similar way to a pastoral lease. Thus, mining tenement holders will have easier rights of access to the land than under a section 79 lease.
Native title rights and interests are usually required to be extinguished for the grant of a section 79 lease. It is not intended that native title rights and interests be extinguished for the grant of a diversification lease, as the proposed type and scale of the use of the land would usually support the continuation of native title rights and interests. Therefore, native title parties may be more open to negotiating a resolution to the future act requirements for the grant of a diversification lease that does not extinguish their rights and interests than to a section 79 that does. This is particularly so where it relates to a large area of land.
Will a third party be able to apply for a diversification lease over the whole or part of a pastoral lease?
Yes. However, the Government has indicated that it will not grant a diversification lease over an existing pastoral lease to a third party without the agreement of the pastoral lessee. The pastoral lessee will first have to agree to surrender, and then surrender, their pastoral lease or the relevant part of it.
A diversification lease cannot be granted ‘on top’ of a pastoral lease. Any pastoral lease must be surrendered before a diversification lease can be granted over the same area.
Could a pastoral lessee convert part of their lease to a diversification lease?
Yes. A decision to convert all or part of a pastoral lease to a diversification lease will be a business decision for the pastoral lessee. The Minister for Lands will determine on good public policy grounds whether to accept the surrender of the pastoral lease and grant of a diversification lease.
However, it is not intended that a diversification lease be granted only for ‘grazing’ or pastoral uses from an existing pastoral lease. There must be other non-pastoral uses proposed in addition to pastoral uses for the grant of a diversification lease to be considered.
Converting only part of a pastoral lease to a diversification lease will require consideration of the effect of the conversion on the viability of the remaining part of the pastoral lease. This would be considered by the Pastoral Lands Board, who would provide their recommendation to the Minister for Lands, who would determine on good public policy grounds whether to allow it to be converted.
What activities could be undertaken on a diversification lease?
Some examples of possible permitted uses under a diversification lease include:
- carbon farming
- multiple uses – e.g. grazing livestock, horticulture, agriculture, tourism
- Aboriginal economic development and land management
- mining companies for environmental offsets or where their activities are substantially inconsistent with existing pastoral uses
- conservation purposes
- renewable energy
- diversification use in conjunction with off-lease activities
- taking advantage of future opportunities that do not currently exist
Can a diversification lease be transferred or subleased?
Yes. Subject to the Minister for Lands’ consent, a lessee may transfer, sublease, or mortgage a diversification lease.
Unlike a pastoral lease, a diversification lease can have multiple subleases to different sublessees for different purposes. For instance, if a diversification lease is issued for the purposes of grazing livestock and tourism, the lessee could have subleases to two different parties, one for grazing livestock and the other for tourism, over two different parts of the leased area or the lessee could carry on both uses itself.
A sublessee may be required to comply with the terms of the ILUA that was entered into by the lessee with the native title party, depending on the terms of the ILUA.
Can a diversification or pastoral lease be used for carbon sequestration activities under the Commonwealth’s Carbon Credits (Carbon Farming Initiative) Act 2011?
Yes. The WA Government has approved the use of the Human-induced Regeneration of a Permanent Even-Aged Native Forest (HIR) carbon sequestration methodology on pastoral leases and has been providing its consent to eligible projects since late 2019.
The diversification lease is designed to allow for a broad range of activities and the permitted uses will be set out in the lease as agreed by the parties. This may allow for the use of other vegetation methodologies for the sequestering and storage of carbon. However, the use of methodologies other than the already approved HIR will be subject to the development of State Government policy and any requirements for the provision of its eligible interest holder consent.
In addition, a diversification lease will coexist with mining rights in the same way that pastoral leases do, meaning that mining tenement holders will have a right of access to the land.
Will a diversification lease be able to be granted for the purpose of environmental offsets?
Yes, if that use is agreed to by the native title holders or claimants in the Indigenous Land Use Agreement (ILUA) and approved by the Minister for Lands.
The Minister will consult with any other relevant Minister (e.g. Minister for the Environment) in deciding whether the grant of a diversification lease and the terms and conditions on which it is granted, is satisfactory to address environmental offset requirements.
Could a tourism enterprise be the only activity on a diversification lease?
Yes, if the nature of the tourism operation requires a broadscale use of the land
Could a tourism operation be run in conjunction with another activity on a diversification lease, such as conservation or grazing cattle?
Yes. Diversification leases are designed to allow multiple land uses, including where more than one of the uses relies on the broadscale use of the land.
Could conservation be the sole land use under a diversification lease?
Yes, if the nature of the conservation proposal requires a broadscale use of the land.
Could conservation covenants be established on land under a diversification lease?
Yes. The covenant can be created under section 15 of the Land Administration Act 1997 (LAA) against the lease or the underlying Crown land. If it is the former, the covenant exists for the term of the lease. In the latter case, the covenant can continue indefinitely.
The policy issues involved in the creation of a covenant over the underlying Crown land are more significant and so a request for a covenant of that type will require greater consideration before the Minister for Lands makes a decision.
In either case, the Minister will have to consent to, or enter into, the covenant.
Covenants may also be able to be registered against a diversification lease under other legislation, but these will need to be considered in the context of the particular legislation and the LAA.
Could a diversification lease be granted for a highly intensive land use?
A diversification lease may allow discrete and identified areas for intensive land use(s) and/or infrastructure. It will be a question of degree as to whether any particular proposal that includes intensive use(s) is suitable for the grant of a diversification lease.
A diversification lease cannot be granted for a highly intensive land use alone, as this would not be consistent with the preservation and ongoing management of the rangeland vegetation as a natural resource, which is intended to be a condition for all diversification leases.
A diversification lease will require the lessee to:
- prevent or minimise the risk of fire in accordance with the Bushfires Act 1954,
- control declared plants and declared animals under the Agriculture and Related Resources Protection Act 1976 and declared pests under the Biosecurity and Agriculture Management Act 2007, and
- maintain the condition of the soil and native vegetation.
In some cases, it may be more appropriate for a diversification lease to be granted in conjunction with an alternative form of tenure, such as a section 79 lease.
What will be the process for applying for a diversification lease?
The first steps will be:
- contact the Department of Planning, Lands and Heritage to discuss your proposal.
- complete the Department of Planning, Lands and Heritage’ Crown Land Enquiry form
The grant of a diversification lease will be subject to the overriding Crown land tenure allocation policy, which requires appropriate tenure for the proposed use. The grant will also be subject to the usual approvals, comment and referrals process from the Department of Mines, Industry Regulation and Safety, Department of Water and Environmental Regulation, local government and other relevant agencies, depending on the particular proposal.
In addition, the appropriate future act process under the Native Title Act 1993 (Cth) will need to be completed before a diversification lease could be granted. This is most likely to be the negotiation of an Indigenous Land Use Agreement (ILUA) with the native title holders or claimants. The native title process can be discussed with the Department of Planning, Lands and Heritage officers during initial discussions on the proposal. A template Indigenous Land Use Agreement and guidelines will be provided by the Department of Planning, Lands and Heritage.
How much will it cost to apply for a diversification lease?
If the request for a diversification lease is supported and the applicant chooses to proceed, the applicant is responsible for the payment of all costs and disbursements associated with the grant of the lease.
These costs may include, but not be limited to:
- the costs of negotiating and compensating native title parties and holders of other interests in the area of land under consideration
- application and approval of any other statutory requirements
- lease rental, and any other related costs such as easement or licence fees
- survey and plan preparation costs
- advertising and gazettal costs (if required)
- document preparation and registration fees
- GST on any of the above.
Will a diversification lease restrict mining companies’ access to the land for exploration and/or mining operations?
No. A diversification lease will be treated in the same way as a pastoral lease under the Mining Act 1978.
However, some of the more significant provisions that will apply under the proposed amendments to the Mining Act 1978 are:
- a diversification lease will be included in the definition of ‘Crown land’ and other provisions, in the same way as a pastoral lease is currently referred to
- the Minister for Mines will have to agree to any change, or variation, to the permitted use(s) under a diversification lease or any changes to the location of substantial structures on the lease area
- the access provisions in section 20 will generally apply to a diversification lease in the same way as they do to a pastoral lease, except that the restriction for mining and access to within 100 metres of the improvements listed in section 20(5) will also include to within 100 metres of a ”substantial structure” to take account of possible uses under a diversification lease
What is the native title process that will need to be followed for the grant of a new diversification lease or conversion of a pastoral lease to a diversification lease? What is an ILUA?
A proposed lessee will need to address the appropriate future act process under the Native Title Act 1993 (Cth) (NTA) before a diversification lease can be granted. This is the case whether it is a ‘new’ diversification lease over unallocated Crown land or it is the ‘conversion’ of a pastoral lease to a diversification lease.
The process is most likely to be the negotiation of an Indigenous Land Use Agreement (ILUA) with the native title holders or claimants. The native title process can be discussed with the Department of Planning, Lands and Heritage officers in your initial discussions on the proposal.
It is preferred that the State be a party to the ILUA because tenure is being granted under the LAA and so it will need to be satisfied that the ILUA contains various provisions required by the State. This will include that the ILUA allows the relevant lease or other tenure to be granted as a future act under the NTA, and that there is full and final satisfaction of any compensation claim for the effect on native title by the grant of the tenure.
Further information in relation to ILUAs can be found on the website of the National Native Title Tribunal.
Proponents will be responsible for all costs relating to native title (in addition to other non-native title related costs). This includes negotiation and meeting costs, any compensation, and registration of the ILUA.
The State will provide a template Indigenous Land Use Agreement and guidelines to assist proponents.
Will the permitted use(s) under a diversification lease be able to be changed or added to later?
Yes, if the Indigenous Land Use Agreement (ILUA) with the native title party provides for those alternative or additional uses. This is because the change to the diversification lease to allow the alternative or additional use may be a further future act under the Native Title Act 1993 (Cth) (NTA).
In addition, the Minister for Mines and Petroleum will have to agree to the changed or additional use.
For these reasons, proponents are encouraged to identify all planned or possible uses for which they may wish to use the land in the diversification lease in the foreseeable future.
They should be included in the negotiations for the original ILUA. If this is not done the lessee may need to negotiate another ILUA for the alternative or additional uses.
If a proponent does not wish to, or does not intend to, undertake all of those possible uses at the time of the grant of the diversification lease, then the lease can be limited to the immediately planned uses. The rent payable under the diversification lease will then be determined by reference to the more limited uses set out in the lease document, and not all of the uses allowed under the ILUA.
When, or if, the lessee wants to expand the uses under its diversification lease to the other uses allowed under the ILUA, the rent payable under the lease will be re-determined having regard to those additional or alternative uses.
At the time of applying for the grant of the diversification lease, the proponent should also identify all planned or possible uses in its application to the Minister. This is to ensure that the Minister agrees to change the lease to allow those alternative or additional uses later and seeks the Minister for Mines and Petroeum’s agreement to those alternative or additional uses.
In addition, the proponent will need to engage in early discussions with the Department of Mines, Industry Regulation and Safety (DMIRS) around the proposed location of substantial structures/infrastructure, such as processing plants or banks of solar panels, on the proposed lease area and understand that such areas will be identified in the diversification lease such that any changes to the location of such structures/infrastructure during the term of the lease will require both the consent of the Minister for Lands and the Minister for Mines and Petroleum.
Is the Indigenous Land Use Agreement (ILUA) that is negotiated for the grant of a diversification lease transferable if the lease changes hands?
The grant of a diversification lease will constitute a future act for the purposes of the Native Title Act 1993 (Cth) (NTA). An Indigenous Land Use Agreement (ILUA) will be required to be negotiated with the native title party or parties and registered at the National Native Title Tribunal prior to the grant of the diversification lease.
Any subsequent transfer of the diversification lease does not constitute a future act and no further ILUA will be required. There may, however, be ongoing obligations under the ILUA that the incoming lessee needs to agree to assume on the transfer of the lease. For example, if benefits under the ILUA are to be paid over a long period of time.
It will depend on what was agreed in the ILUA between the original lessee and the native title party. If there are ongoing obligations, the ILUA may require the incoming lessee to enter into a deed with the native title party under which it agrees to be bound by the ILUA.
What will be the role of the Pastoral Land Board in relation to the Diversification Lease?
If a diversification lease does not include grazing as one of its purposes, then the Minister for Lands will be the decision maker regarding matters concerning the lease. However, if grazing is one of the approved uses of a diversification lease, then the relevant provisions in Part 7 of the Land Administration Act 1997 in relation to pastoral leases will be imported into the lease itself. The Minister will still be the decision maker but will consult and take advice from the Pastoral Lands Board on those matters that the Board would ordinarily decide on in relation to the administration of pastoral leases.
Will a pastoral lessee be able to convert a pastoral lease into a diversification lease solely for grazing purposes?
No. Diversification leases are not intended to be granted solely for grazing purposes as the appropriate tenure for such a use is a pastoral lease. Any ‘grazing’ purpose in a diversification lease will require the relevant provisions in Part 7 of the Land Administration Act 1997 in relation to pastoral leases to be imported into the lease itself so there would be no advantage to a pastoral lessee to change to a diversification lease only to use it for pastoral purposes. This is particularly so given the likely need to negotiate and Indigenous Land Use Agreement and the costs and expenses associated with the grant of alternative tenure. Regardless of the land use, all diversification leases will be subject to statutory minimum land management conditions.
Streamlining land tenure approvals and projects - Administrative and generalShow more
Why is a timeframe being imposed on local government responses under s14 of the Land Administration Act 1997?
Section 14 of the Land Administration Act 1997 requires the Minister to consult with the relevant local government, prior to exercising any power in relation to Crown land. Currently there is no timeframe within which local government is required to respond. Quite often it takes many months and several follow up phone calls and emails before a response to the consultation is received from a local government. This can cause delays in projects and administrative inefficiencies for both the local government and the Department.
It is proposed that the local government will have 42 days, or any extension granted by the Minister, to provide submissions to a proposal. Where a local government has a good reason for not being able to respond within 42 days, an extension of time will be given.
Will the statutory timeframe for local government responses apply in all cases?
No. The timeframe of 42 days within which a local government must respond to a request for consultation will not apply to actions arising from Part 5 – Roads, as roads are either created or closed at the request of the local government authority, or the process under Part 5 contains its own consultation requirements.
Why is the State asking local governments to exercise Land Administration Act 1997 powers to remove unauthorised structures on reserves under their management?
Currently the Minister can delegate his or her power to remove unauthorised structures and grant an extension of time for the removal of such structures to a local government or a management body responsible for the care, control and maintenance of a reserve. The process to delegate these powers is difficult and time consuming and as a result, is not generally done.
However, it is local government and management bodies that are on the ground, dealing with such matters on reserves that are most likely to be best placed to exercise these powers. While it is right that delegations be well-controlled and not taken lightly, the current high level of control is causing inefficiencies.
Therefore, it is proposed that the Land Administration Act 1997 will be amended to remove the need for delegation from the Minister and provide local government and management bodies with the direct power to remove unauthorised structures and grant extensions of time for removal. This means less red tape and greater efficiency for local governments and the State in dealing with such matters.
Why does the Minister for Lands need to be able to deal with freehold land?
The Minister for Lands was previously able to deal with freehold land acquired for public works under the Public Works Act 1902 and the Land Acquisition and Public Works Act 1902, but these provisions were not transferred across to the Land Administration Act 1997. Currently, there is no general power for the Minister to hold and deal with land in freehold. The powers to deal with land under the Land Administration Act 1997 apply only to Crown land, therefore if any land is held by the State in freehold but requires land assembly actions to be undertaken on it, these can only currently be done at significant cost and with greatly extended timeframes.
Why does the Minister need to have the ability to subdivide, develop or improve freehold land?
This power is particularly relevant to current Government policy around the sale of some State assets. These provisions will enable the Minister to obtain the highest value for State land, benefitting all Western Australians.
Doesn’t the Minister already have the power to enter into contracts in relation to Crown land?
The Land Administration Act 1997 does provide the Minister with certain powers in relation to Crown land but there is no specific power that allows the Minister to enter into contracts for the management of Crown land. A provision is required to make it clear that the Minister can enter into contracts for services in connection with the administration or management of Crown land. This would include things like contracting for mustering, remediating sites, technical advice, and general management.
This general power will extend to the making of arrangements which may not necessarily have contractual force, such as memorandums of understanding. This power would extend to contracts or arrangements with local government, State trading enterprises as well as State government departments or agencies.
Why can’t I hold on to conditional freehold land and not use it?
Conditional tenure land is transferred in fee simple subject to certain conditions concerning the use of the land. The objective is to ensure that the land is used for a certain purpose, generally one that provides a community benefit, and the land is usually transferred for less than market value.
The Minister is authorised to forfeit conditional tenure land where the land is being used in breach of any condition concerning the specified use. However, in circumstances where the land is simply not being used, the Minister may not be able to lawfully forfeit the land.
It is not appropriate for land that has been transferred in fee simple, but at much less than market value for the purpose of providing a service to the community to continue to be held if the community is no longer benefitting from that arrangement.
The LAA is being amended to allow for service of documents by electronic means, such as email. Will I still get notifications if I don’t have email or access to the internet?
Yes. While it proposed to provide for electronic service of documents, the existing methods of service such as delivering a document personally or sending a letter via pre-paid post or facsimile will remain.
Why are there amendments to allow the sharing of information with other government departments?
Government departments frequently liaise with each other in the course of carrying out Government business and sometimes need to share relevant information about certain matters. However, this presents some conflicting considerations between the expectation from people who deal with Government that their private or commercially sensitive information be treated as confidential and their privacy protected, and the community expectation that government departments share information such that Government can respond decisively and in a coordinated fashion when required.
Modern legislation, such as the Biosecurity and Agriculture Management Act 2007 (BAM Act) and the Biodiversity Conservation Act 2016 (BC Act), include provisions related to information sharing with specific organisations, defining them as “information sharing agencies”.
Generally, the legislation provides the ability for the “home” department (the department that administers the Act) to share information with the “information sharing agencies”, and to request information from public authorities for the purposes of the legislation.
The Western Australian Whole of Government Open Data Policy encourages agencies to share information but notes that agencies must consider their own legislative requirements in implementing the policy. Currently, the Land Administration Act 1997 (LAA) does not provide clear guidance around what information can be shared with whom, for what purpose and what safeguards are in place to protect the use of that information.
The Auditor General, in his report Management of Pastoral Lands in Western Australia, found that “the ecological sustainability of the pastoral estate was not adequately protected by the current system of monitoring and administration” including that information management was poor and there was a lack of information sharing between agencies. Furthermore, he noted that comprehensive and reliable pastoral lease information, shared between agencies, was essential to making appropriate decisions and improving land management outcomes in the rangelands.
At present, the Pastoral Lands Board (PLB) is required to share information with the Commissioner of Soil and Land Conservation under section 137 of the LAA and relies on an administrative service from the Department of Planning, Lands and Heritage, as well as a technical service from the Department of Primary Industries and Regional Development, both of which require the sharing of information.
In addition, while the Valuer General makes valuations of land for, and provides valuation advice to, the department, in practice the department shares practical information necessary for the Valuer General to make valuations (including rental determinations). Proposed amendments to the pastoral market rent methodology will allow the PLB to provide certain information to the Valuer General in order that the Valuer General can determine market rents. Relatedly, the department will be able to provide information regarding pastoral lease sales to the Valuer General.
Which Government agencies will be included in the list of “information sharing agencies” for the purposes of the Land Administration Act 1997?
The process for evaluating an application for Crown land tenure requires a referral process, which includes:
(a) approvals under the Mining Act 1978, specifically section 16(3) and section 91(5), and the question of mineral prospectivity and the possibility of the new tenure interfering with the extraction of that mineral resource, assessed by referral to the Department of Mines, Industry Regulation and Safety;
(b) environmental considerations, such as the impact of a proposed land use on biodiversity under the Biodiversity Conservation Act 2016, assessed by referral to the Department of Biodiversity, Conservation and Attractions; (c) if water extraction or clearing of native vegetation is required, approvals under the Rights in Water and Irrigation Act 1914 and the Environment Protection Act 1986 and environmental impact of the proposal, assessed by the Department of Water and Environmental Regulation;
(d) involvement of the Environmental Protection Authority, should the proposed land use meet the threshold of Part IV of the Environment Protection Act 1986;
(e) if the application involves agriculture or aquaculture, rangeland development and management and biosecurity, assessment under the Animal Welfare Act 2002, the Aquatic Resources Management Act 2016, the Biosecurity and Agriculture Management Act 2007 or the Soil and Land Conservation Act 1945, by referral to the Department of Primary Industries and Regional Development,;
(f) referral to the Department of Fire and Emergency Services, if the matter relates to fire management under the Bush Fires Act 1954, particularly in respect of land access for fire mitigation activities;
(g) referral to the Department of Transport, if the matter relates to harbours under the Marine and Harbours Act 1981;
(h) liaison with the Commissioner of Main Roads in regards to main road or highway related matters;
(i) consideration under the Local Government Act 1995;
(j) valuation by the Valuer-General; and
(k) registration of tenure at the Western Australian Land Information Authority, referred to as Landgate.
In addition, officers of the Department use Crown land information to perform functions under the:
(a) Dampier to Bunbury Pipeline Act 1997 to assist the Minister for Energy;
(b) Aboriginal Affairs Planning Authority Act 1972 to assist the Minister for Aboriginal Affairs;
(c) Planning and Development Act 2005 to assist the Minister for Planning; and
(d) Heritage Act 2018 to assist the Minister for Heritage.
All of the agencies which principally administer the above Acts, are considered to be “information sharing agencies”.
In which circumstances is information sharing required in relation to pastoral leases?
There is a range of circumstances in which information sharing is required, and for which the Land Administration Act 1997 (LAA) does not presently provide, including:
(a) where the Pastoral Lands Board (PLB) may need to request specialist advice from the Department of Primary Industries and Regional Development (DPIRD), the Department of Water and Environmental Regulation (DWER), and the Department of Biodiversity, Conservation and Attractions (DBCA) and other agencies as appropriate, in relation to things such as:
i. management plans required by the PLB;
ii. compliance issues in relation to management of land or management of permitted stock;
iii. unlawful clearing and subsequent restoration requirements under section 109; and
iv. requirements regarding stock distribution and numbers);
(b) where the PLB refers permit applications to DPIRD, DWER, and DBCA so that it can satisfy itself that the permit application meets the requirements of environmental laws listed in section 117; and
(c) when the PLB is providing advice to the Minister for Lands on a new pastoral lease proposal, the abovementioned agencies are also consulted.
Will there be limits or controls placed on information sharing?
Yes. Information sharing will be governed by a set of guidelines, which will be published and readily available, outlining the manner in which information will be disclosed, requested, and stored. These guidelines will establish what information may be shared and under what circumstances.
At all times, information shared will be proportionate to the purpose for which it is being shared. For example, when seeking advice from the Department of Primary Industries and Regional Development regarding an application for a permit under Part 7 of the LAA, all the information included by the proponent in the application form will be passed on. However, when contacting the Department of Water and Environmental Regulation about the same permit, the department would only be asking whether the proponent has applied for, or received, a clearing permit or water licence to be able to prepare the land for the purpose of the permit.
Streamlining land tenure approvals and projects - ReservesShow more
What is the purpose of amending the Land Administration Act 1997 to provide that an interest or caveat in Crown land can continue if the land is subsequently reserved?
Section 22 of the Land Administration Act 1997 (LAA) provides for the continuation of interests and caveats in Crown land to remain after changes in status, i.e. if Crown land ceases to be either reserved under Part 4; dedicated, reserved or set apart or vested under another written law; or subject to a management order, any existing interest or caveat will continue.
However, this continuation of interests currently only applies when the land is already reserved. Section 22 does not deal with cases where there is an interest or caveat on Crown land, but that land is not already reserved.
Where, for instance, there is a section 79 lease on unallocated Crown land, it is unclear as to whether the section 79 lease will continue if the land is subsequently reserved and subject to a management order. This amendment will clarify that the interest (in this case the section 79 lease) will continue after the land is reserved.
However, only interests that are expressly preserved at the time of reservation will continue.
Why are you broadening the circumstances in which a management order can be revoked without the consent of the management body?
Under the Land Administration Act 1997 the Minister cannot amend a managed reserve, or its conditions of management, without the consent of the management body and can only revoke a management order in its entirety. This means that for land to be excised from a reserve, the management body must first agree to the excision.
Where there is no agreement, the only course of action available is to revoke the management order over the whole of the reserve, excise the portion from the reserve and then seek to have the management body accept a new management order over the balance of the reserve. This is impracticable and undesirable and can result in the balance of the reserve being unmanaged.
Additionally, in some instances, for example, an excision of more than 5% of a class A reserve for a road, the change to the reserve must be tabled in Parliament. Currently, however, the management body of the A class reserve must consent to the proposed change being tabled in Parliament. Where a proposal to amend a reserve is subject to Parliamentary scrutiny, it is inappropriate that a management body can prevent the proposal from going before Parliament.
A new consultation process will apply prior to exercising certain actions which affect class A reserves, certain reserves subject to the Conservation and Land Management Act 1984, or excisions from reserves which the Minister considers is required in the public interest or necessary for the purposes of a public work. A statutory timeframe of 42 days within which the management body can respond will apply.
The Minister for Lands already has the power to revoke a management order in the ‘public interest’. Why are you widening that power to include for a ‘public work’?
There has been some doubt as to what exactly is defined as being “in the public interest” and it may be the case that reserve land might be required for a public work that might not necessarily be “in the public interest”. As a result, management bodies have been required to enter into management order deeds to ensure that the Minister has the power to revoke the management order should the land be required for a public work or purpose. The change in definition removes the need for management bodies to enter into management order deeds, streamlining processing times and reducing red tape.
Streamlining land tenure approvals and projects - RoadsShow more
What are the proposed changes to how roads are dedicated or closed?
The proposed amendments will streamline the process of creating and closing roads under the Land Administration Act 1997.
Currently, all interests (e.g. an easement) must be removed from the land in order to dedicate a road. Some of these interests are then re-registered after the dedication if they are still required.
The proposed changes will:
- permit specified interests to survive the dedication of a road where the road has been dedicated under the Land Administration Act 1997 or section 168 of the Planning and Development Act 2005;
- automatically extinguish interests not required after the dedication and for which other suitable arrangements exist;
- permit specified interests to survive the closure of a road, along with leases granted under section 57;
- streamline the road closure process for local governments; and
- enable the Minister for Lands to initiate road closures where the Minister considers a road should be permanently closed.
What interests will be extinguished by the dedication of a road?
Interests that are not required after a road has been dedicated and where other suitable arrangements and/or no private rights, exist will be automatically extinguished by the dedication of the road.
For example, service easements under section 167 of the Planning and Development Act 2005 (and the equivalent section 27A easements under the repealed Town Planning & Development Act 1928) as service providers have adequate rights for their infrastructure in road corridors under their own enabling Acts.
What interests can remain in place when dedicating a road?
Classes of interests that are intended to survive dedication will be prescribed and the Minister for Lands will have the option to decide, on a case-by-case basis, to preserve specified interests on the dedication order. These interests will include the Dampier to Bunbury Natural Gas Pipeline corridor, memorials and easements.
Will the dedication order automatically extinguish all interests, or will they still need to be surrendered or compulsorily acquired?
No. Only interests which are no longer required and where other suitable arrangements exist will be automatically extinguished by the dedication of the road. Interests which are required to remain on the land post dedication of the land as a road will survive by being specified on the dedication order.
Where private interests exist over the land proposed to be dedicated as a road, and are inconsistent with the purpose of road, these interests will be required to either be surrendered or compulsorily acquired.
If an interest (e.g. an easement) is extinguished by a road dedication, is compensation payable?
No. Compensation will not be payable for an interest which is automatically extinguished by a road dedication. The interests which are intended to be automatically extinguished are interests which are not required post-dedication, are not private rights and where other suitable rights exist. Similar to the current case with private roads, where these interests are extinguished, no compensation will be payable.
However, appropriate compensation will be payable for the surrender of private rights which are not being continued in some form post-dedication, as is currently the case.
Who will be able to request a road closure?
Currently, only the local government can request a road closure. The amendments will enable the Minister for Lands to initiate a road closure where the Minister considers that a road should be permanently closed. This will only apply to roads under the management of local governments and the Minister will be required to consult with the local government.
Will the dedication allow for the non-extinguishment of native title subject to section 24KA of the Native Title Act 1993 (Cth)?
Yes. All interests, including native title rights and interests, will be able to survive dedication.
What happened to the proposed amendments to include powers for the Commissioner of Main Roads to dedicate, close and transfer management of main roads under its management?
Through consultation and discussions with Main Roads Western Australia, these changes will instead be considered in a later tranche of amendments to the Land Administration Act 1997.
Streamlining land tenure approvals and projects - EasementsShow more
What is an easement in gross and why does it need to be transferred?
The Land Administration Act 1997 (LAA) provides that the Minister may grant, vary and cancel easements over Crown land, including an easement ‘in gross’, which is an easement that can exist without being tied to a dominant tenement. While an easement can be transferred with the land to which it is tied (i.e. the dominant tenement) when changes are made to the tenure of that land, there is no provision in the LAA for easements in gross to be transferred.
The transfer of an easement in gross is required, for example, where a slurry pipeline runs through Crown land for the transport of mining waste from a mining operation. While the mine is situated on a mining tenement, the pipeline is not and is, instead, located on an easement in gross. When the mining operation is sold, the sale will include the slurry pipeline as a part of the assets of that business. However, the underlying easement for the pipeline, because it is an easement in gross cannot be transferred to the new owner and a completely new easement in gross must be prepared and granted. This is inefficient and inconsistent with the provisions for easements, carries with it native title implications, and causes unnecessary delays to the mining operation.
Pastoral LeasesShow more
Will there be any changes to the way Pastoral Lands Board members are appointed?
Yes. The current practice whereby the Minister for Lands seeks advice and/or nominations from the Minister for the Environment and the Minister for Aboriginal Affairs, respectively, in the appointment of the Pastoral Lands Board (PLB) members with expertise in these areas will be formalised.
Why is the method of advertising the grant of a pastoral lease changing? What if I don’t have good access to the internet?
Currently the Minister is required to advertise the grant of a pastoral lease in a newspaper circulating throughout the State. This requirement, along with similar such requirements throughout the Land Administration Act 1997, can be inflexible, costly and potentially inefficient as the West Australian newspaper does not necessarily reach every part of the State.
It is proposed to allow the grant of a pastoral lease to be advertised in alternative forms of publication to provide greater transparency and more flexibility. These other modes of publication will be prescribed. An example of an alternative is the Department’s website. However, the original method, whereby an advertisement is placed in the West Australian, is still valid, and will still be used.
Why are land condition standards and guidelines being introduced and what does this mean?
The Pastoral Lands Board, in consultation with the Commissioner of Soil and Land Conservation, has begun implementing a clearer and more transparent approach to land management on pastoral leases. This includes the establishment of quantitative Land Condition Standards which will objectively define whether the land condition of a pastoral lease is at acceptable, sub-optimal or unacceptable levels.
This information is intended as a tool for lessees to assist them in managing their land, and for the PLB in ensuring land condition meets its standards. To reflect the large differences in vegetation and climate across the State, separate land condition standards will be developed for each pastoral region.
Land management guidelines complement the land condition standards by defining the PLB’s views about current best-practice land management actions. In anticipation of these amendments, the PLB has already developed a policy document, the Good Pastoral Land Management Guidelines, as a tool for lessees who are either new entrants to the pastoral industry, or land managers looking for alternatives to their current practices. In future, the PLB will continue to rely on land management guidelines when exercising various functions, for example when requesting lessees to undertake land restoration and remediation activities under a Management Plan.
What will be the effect of the land condition standards and guidelines?
These are guidelines only and the provisions of the Land Administration Act 1997 (LAA) will continue to prevail. However, the Pastoral Lands Board will have to have regard to land condition standards and land management guidelines in performing its functions under Part 7 of the LAA. Similarly, these standards may be used by the Commissioner of Soil and Land Conservation in assessing land condition under the Soil and Land Conservation Act 1945.
For example, the PLB and / or the Minister for Lands may refer to the land management guidelines when requesting lessees to undertake land restoration and remediation activities as part of a Management Plan.
What is a land management accreditation system, and what benefit is there to me being accredited?
The proposal is to give the Minister a power to approve a land management accreditation system to encourage the use of best-practice pastoral land management.
The system will provide recognition to pastoral lessees who, on a voluntary basis, meet the land management criteria established by the system. Aside from any commercial benefits associated with potential recognition of land management accreditation in markets, pastoral lessees who are recognised as good land managers and have received certification through an accredited system may receive certain benefits, including:
- certification being a criterion that the Minister may have regard to when deciding whether to extend the term of a lease beyond the current term to a term up to 50 years; and
- the ability to use accreditation to demonstrate good land management credentials, as required by their leases and the Land Administration Act 1997.
Why is a land management accreditation system being proposed for inclusion in the legislation?
The idea of an accreditation system came about as a result of the 2017 OAG Report, which contains a number of recommendations “to improve the sustainable outcomes for the pastoral industry and the communities it supports”. The Pastoral Lands Reform Development Project involves developing the parameters of accreditation systems - in effect, establishing the “goal posts” for the Minister for Lands to be satisfied with an accreditation system. This will in turn guide the development of an appropriate system by industry.
Certification under an approved Accreditation system will assist pastoralists to formally demonstrate their land management credentials. It is proposed that the Minister for Lands and the PLB will have regard to in relation to exercising various functions. For example, the Minister may consider certification in deciding whether to grant a request for a lease extension.
A significant benefit of the accreditation system’s focus on land management improvements is that accredited pastoralists will be establishing the key preconditions for improving the condition of the land under the lease. Good land management enables a better response to good seasons, which then increases productivity, leading to a more profitable pastoral business. The benefits to both Government and pastoralists of the accreditation system are a key element of its inclusion in these amendments.
How will I be able to increase or extend the term of my pastoral lease?
A pastoral lessee will be able to apply to the Minister for Lands for an extension of the term of their lease. The Minister has full discretion as to whether or not to grant the extension, and on what conditions. The Minister may consult with the Pastoral Lands Board (PLB) regarding the condition of the land under the lease, and the land management record of the pastoral lessee, and may consider whether a lessee is certified under an approved accreditation system.
Further, if native title has been determined to exist, or may exist, over the land, a future act process will be required. The State will require the lessee to enter into an ILUA with the relevant native title party(s), under which the lessee assumes responsibility for the payment of any compensation that may be required as part of satisfying the future act process.
If native title has been determined not to exist over the land, the process will be simpler, involving only the pastoral lessee and the Minister (in consultation with other State government agencies).
Why is an amendment enabling the extension of a pastoral lease being proposed?
This amendment is designed to assist pastoral lessees whose lease terms are shorter than the maximum allowable of 50 years. Unlike other leases available under the Land Administration Act 1997, there is no power to extend the term of a pastoral lease. Generating long-term sustainable outcomes on pastoral leases requires lessees to have certainty over a long time horizon. Introducing the ability to extend short-term leases will provide these pastoral lessees with an incentive to invest in the land to address land degradation issues, enabling the lessee to plan and manage the land under the lease for the long term.
The long time horizon is required for three reasons:
- due to the large area of pastoral leases (around 200,000 hectares on average) and relatively low per hectare returns, developing pastoral infrastructure such as fences, stock water points and homesteads, requires substantial up-front capital investment,
- highly variable and unpredictable rainfall in much of the Western Australian rangelands, along with significant market fluctuations, leads to highly irregular income streams for pastoral lessees, and
- in the rangelands, there is often a long lag time between action and consequence. For instance, if rangeland condition is poor, unpredictable rainfall means this may take years or even decades to rehabilitate, requiring substantial expenditure over a long period through destocking or mechanical intervention.
The amendment will benefit pastoral lessees with shorter leases, and thus short time horizons, by providing incentives to invest the resources required for optimal environmental outcomes. In addition, having a longer-term lease tenure will provide the security required for long-term debt finance required to finance capital investment.
The proposed amendments will also assist those pastoral lessees wanting to participate in carbon sequestration projects using the human-induced regeneration methodology by ensuring that there is sufficient term remaining on their lease to meet the required timeframe to undertake the up-front registration and reporting activities as well as the 25-year permanence period required under the Commonwealth Carbon Credits (Carbon Farming Initiative) Act 2011.
Why haven’t the changes to the renewal provisions for pastoral leases in section 140 of the Land Administration Act 1997 been included in the proposed amendments?
The State has not abandoned the proposed changes to the right of renewal provisions that were proposed in 2019 but considers that these amendments should await the outcome of a number of native compensation claims which are currently before the Federal Court.
The renewal of a pastoral lease is a future act under the NTA and compensation for the effect on native title rights may be payable, at first instance, by the State. The quantum of compensation (if any) that the State may be liable for is currently unknown, but it is hoped that the current compensation claims, when resolved, might provide some guidance.
The intention is to include these amendments in a later amendment of the LAA.
What is the difference between a Development Plan and a Management Plan?
Presently, the Pastoral Lands Board (PLB) can require a pastoral lessee to submit a Development Plan. Development Plans are limited to addressing issues related to the construction and maintenance of physical infrastructure and do not cover broader land management issues. While physical infrastructure is one means of achieving good land management outcomes, there are other ways of achieving these outcomes in modern pastoral operations.
However, the PLB does not have the power to require a pastoral lessee to provide a more comprehensive management plan to address land condition or other issues associated with the lessee’s obligations under Part 7 of the Land Administration Act 1997 (LAA). A Management Plan will provide for flexibility in how a pastoral lessee can achieve good land management outcomes in a way that a Development Plan cannot. A land management plan may include financial management, grazing management, infrastructure, diversification permits, and broader questions of land management, including weed and feral animal management, as well as landscape rehydration and rehabilitation, where relevant.
In what circumstances will a pastoral lessee have to monitor and report on land condition?
Under the Land Administration Act 1997 (LAA) currently it is not possible to require pastoral lessees to undertake monitoring and reporting on the land under their pastoral leases. This amendment will provide the Pastoral Lands Board (PLB) with that power, within the context of issues being identified in relation to land condition and management of permitted stock.
Why would the Pastoral Lands Board ask a pastoral lessee to remove a specific number of stock?
Where the Pastoral Lands Board (PLB) is concerned that there are land condition issues on a pastoral lease, it may require the lessee to remove a specified number of stock from the land under the lease. The reduction of stock numbers is one of the most effective means of addressing land condition issues in the short term.
Currently, the Board can set maximum and minimum numbers of stock. However, given the size and remoteness of many pastoral leases, it is time consuming, expensive, and intrusive to verify compliance with a directive on total number of stock.
The removal of a specified number of stock, on the other hand, can be easily verified through the Biosecurity and Agriculture Management (Identification and Movement of Stock and Apiaries) Regulations 2013, weigh bills and the like, making the removal of stock administratively less complex, transparent and more readily verifiable.
Will it be allowable to agist livestock on a pastoral lease without permission from the Pastoral Lands Board?
Yes. At present, a pastoral lessee is required to obtain permission from the Pastoral Lands Board (PLB) before allowing any stock belonging to a third party to be agisted on the lease. Under the terms of the lease and the Land Administration Act 1997 (LAA), the lessee is responsible for the land condition of the pastoral lease.
The land condition of a pastoral lease is determined by the total grazing pressure on the land. From this perspective it is irrelevant whether the stock is owned by the lessee or by another person and agisted on the pastoral lease with the agreement of the lessee. Lessees are already required to report on all livestock, including any under agistment, in their annual returns.
In some cases, short-term agistment arrangements assist the industry in managing drought and other extreme weather events. The requirement to obtain the PLB’s permission to agist stock is an administrative burden for all parties with little or no public benefit.
Why is the date for submission of annual returns changing, and to when?
Currently, lessees must complete their annual return at 30 June each year, and submit it no later than 31 December that same year. The proposal is to change the annual return date to 31 December, and the submission date to no later than 31 March of the following year (e.g. complete the return as at 31 December 2021, and submit it by 31 March 2022).
Changing the date by which pastoral lessees are required to complete their annual returns to the end of the calendar year:
(a) better aligns with pastoral business practices, providing more accurate and useful reporting of stock numbers,
(b) allows pastoral lessees to provide annual returns when they are comparatively more operationally free to do so, and so will not be diverted from management of their leases,
(c) will give the Government an accurate indication of the livestock numbers carried over the wet season in the north of the State and over the summer in the south of the State, which is important from a land management perspective, and
(d) recognises that there are fewer stock movements during this time of the year. The number of livestock carried over this period has a much greater relevance to land condition than do the number carried during the middle of the year.
Why is the Minister for Lands going to be able to grant rent relief to all, or certain classes of, pastoral leases without applications from individual pastoral lessees?
This change will enable a swifter, more flexible response to adverse conditions in the pastoral estate. Currently, rent relief is assessed on a case-by-case basis by the Pastoral Lands Board (PLB), in response to an application from a lessee that must include supporting evidence in a statutory declaration outlining the case for rent relief. The pastoral lessee must demonstrate financial hardship due to a natural disaster or economic circumstances out of their control. The PLB then makes a recommendation to the Minister that the payment of rent be delayed, reduced, or waived, and the Minister determines whether to accept or reject that recommendation. However, the Minister does not have the power to apply rent relief across the board to all, or a class of, pastoral leases that may be impacted by the same events or circumstances. It is often impractical and administratively inefficient to require lessees to apply for rent relief individually.
The amendments will give the Minister more flexibility to grant rent relief in the future. In consultation with the PLB, the Minister will be able to provide rent relief to all, or a class of, lessees facing financial hardship due to a natural disaster, poor economic conditions in the pastoral industry and in certain other circumstances, without necessarily having to first require individual applications.
Will changes to the need to comply with the requirements of environmental legislation streamline the diversification permit approval process?
Yes. Currently the Land Administration Act 1997 (LAA) prohibits the Pastoral Lands Board (PLB) from issuing a diversification permit until it is satisfied that any requirements of the Biosecurity and Agriculture Management Act 2007, Environmental Protection Act 1986; Soil and Land Conservation Act 1945; Biodiversity Conservation Act 2016; or any other written law relating to environmental conservation which is applicable to the land under the lease,
have been complied with.
However, in some cases, the responsible agencies will not issue the required permits or authorities under those Acts before a diversification permit has been issued. For example, the Department of Water and Environmental Regulation (DWER) will not issue a clearing permit until the PLB has confirmed an intention to issue a diversification permit to undertake the proposed activity.
The current diversification permit application approval process creates a potential circularity, where:
(a) the LAA precludes the PLB from issuing a diversification permit until all of the requirements of environmental conservation legislation have been worked through and relevant permissions have been granted by various agencies, but
(b) some of these permissions cannot be granted until the PLB has issued a diversification permit.
At present, the PLB issues permits subject to compliance with the relevant Acts but this practice could be challenged by third parties and is not satisfactory. The amendment will enable the PLB to issue a permit for the diversification activity but require that no activity be carried out before any environmental conservation requirements are complied with.
What do the changes to the Pastoral Lands Board’s ability to deal with a diversification permit mean?
These amendments seek to simplify administrative arrangements and make diversification permits easier to deal with for both the Pastoral Lands Board (PLB) and the lessee. Changes proposed include providing the PLB with the ability to
- suspend, or
- cancel a permit.
Currently the PLB has no power to amend a permit if, for example, a pastoral lessee wants to add another type of non-indigenous plant variety to its permit, or the PLB wants to vary the required public liability insurance cover in line with current industry practice. In such cases, the existing permit must be cancelled and a new permit issued which creates additional work, causes delays and extra costs. The changes will allow a permit to be amended without the necessity of a new one being issued.
On expiry of a permit, a lessee must apply for a new permit, even though there is no change of activity under the permit and the activity is being conducted in accordance with the permit conditions. In addition, the PLB sometimes issues a permit for a shorter term, to allow a pilot project to be established and to monitor its success before agreeing to a longer term. The changes will allow for a permit to be renewed, providing administrative efficiencies for all parties and greater security for pastoral lessees in operating, expanding existing or developing new activities on their lease.
Land Administration Act 1997 (LAA) is not clear as to whether a permit may be terminated and whether the process for addressing a breach or non-compliance with a condition in a permit is the same as for non-compliance with the lease or a provision of the LAA (i.e. default notice and, ultimately, termination of the lease). In addition, as a permit is issued personally to the pastoral lessee and not registered on the land, it is separate from the pastoral lease.
In view of this, there may be cases where it is not appropriate that the same consequences apply to the breach of a permit condition as apply to a breach of a pastoral lease condition. Where a breach relates to a diversification permit alone, forfeiture of the entire pastoral lease would generally be disproportionate to the nature and extent of the breach. In such cases, the suspension or cancellation of the diversification permit is likely to be a more appropriate response.
Can a diversification permit be transferred now? What is the benefit of being able to transfer a permit?
No. If a pastoral lessee wishes to sell and transfer the pastoral lease, the lessee cannot transfer the existing diversification permit. Consequently, if the incoming pastoral lessee wishes to continue the permitted activity, they must apply for a new permit after the transfer of the lease. This creates delays and uncertainty as to whether the incoming pastoral lessee will be issued a new diversification permit and, if so, on what terms. It also results in additional costs for the incoming lessee.
In addition, the system may give rise to a situation where the Pastoral Lands Board (PLB) declines to reissue a diversification permit to the incoming lessee, or the incoming lessee declines to accept an offer of a diversification permit after the pastoral lease has been transferred. In such cases the former permit holder would be responsible to make good the site, but this would be impossible for the State to enforce as the former permit holder, being the former pastoral lessee, no longer has legal access to the site.
These uncertainties materially affect the value of the activity undertaken under the permit and what an incoming lessee might be prepared to pay for it as part of the broader sale of the pastoral lease.
The sale of the lease, inclusive of the permit, enables the seller to receive full value for the pastoral lease being sold, and also provides certainty for the incoming lessee, with respect to the economic activities permissible on the land under the lease. The cost of transferring a diversification permit will also generally be less than the cost of granting a new permit. However, incoming lessees will be responsible for confirming that any licences associated with the permit activity (e.g. water licence for irrigation of fodder crops under a section 119/120 permit) will be transferred, and for paying any costs associated with that transfer.
The incoming lessee also has certainty that the PLB and the outgoing lessee have ensured that the permit area is compliant with all permit conditions prior to the transfer of the lease being effected.
Why is the methodology for determining pastoral lease rent changing?
The current rent methodology, requiring the Valuer General to determine rents every 5 years on 1 July, from 1 July 1999, has seen significant volatility in the assessed rent over the years.
The most recent determination took place on 1 July 2019 and resulted in a significant rent increase for a number of pastoral lessees, particularly in the Kimberley and Pilbara regions (in one case a 400% increase). To alleviate the impact on affected lessees, the Land Administration Regulations 1998 were amended to phase in increased rents.
The Minister for Lands committed to reviewing the pastoral rent determination methodology. As part of this review, the pastoral industry identified three key concerns:
- Timelines: the rent (including rent for permits) for all 490 pastoral leases is determined by the Valuer General on the same day as the new rent is payable, and the Valuer General is to consult with the Pastoral Lands Board (PLB) concerning the economic state of the pastoral industry. Effectively pastoral lessees are to be invoiced for the new amount on the same day. In practice, the determination is undertaken six months before the due date to give sufficient time for consultation with the PLB, the Minister to be advised of the new rent, and the invoices for the revised rent to be issued, before the reviewed rent becomes payable on 1 July. It is impossible for the Valuer General to comply strictly with this requirement under the LAA and there are practical implementation issues for the Department.
- Volatility: on average, the most recent rent determinations resulted in a 200% increase in 2009, a 45% reduction in 2014 and a 65% increase in 2019. This degree of volatility negatively affects the ability of pastoral businesses to conduct long-term financial planning.
- Transparency: the current valuation methodology consists of an unimproved land value multiplied by a capitalisation rate, both determined by the Valuer General. Unimproved land value is a valuation construct that can be confusing to the general public, and the market capitalisation rate has a degree of subjectivity, which leads to a lack of clarity. In addition, valuations can be highly unpredictable – the Valuer General’s initial valuation in 2019 resulted in an average increase in pastoral lease rent of 200%, but this was reduced to an average of 65% on appeal.
What is an annual Consumer Price Index (CPI) model, and why has this been proposed?
Under the CPI model, pastoral rent will increase with inflation each year on 1 July and adjusted via a market rent review every ten years. This is anticipated to improve transparency, predictability, and reduce volatility in pastoral lease rent determinations. In addition, the CPI model is commonly used for rent reviews in commercial leases so many people are familiar with the way it works.
It is intended that the new model will commence on 1 July 2024. The starting point for rents on that date will be whichever is the lowest out of the current rent for the pastoral lease, or the average rent for the pastoral lease over the last 20 years (as determined in 1999, 2004, 2009, 2014 and 2019).
It is proposed the CPI review date fall annually on 31 December with the rent determination to take effect the following year on 1 July. This will give the Department sufficient time to review the rent for all 490 pastoral leases and permits and undertake the various administrative actions in time for the reviewed rent to come into effect on the following 1 July. It will also allow the Department to advise pastoral lessees of their new rents well ahead of time, providing a degree of predictability.
How will the market rent review change?
Under the proposed amendments the market rent review interval is extending from five years to every ten years, with the next market determination to take effect on 1 July 2029. The new valuations will be based on market data as of 1 July 2028, and the Valuer General will provide the Department with the proposed new rents by 31 December 2028. This will give the Valuer General sufficient time to effectively determine market rents as well as allowing the Department to advise pastoral lessees of the rent determinations in early 2029 and provide it with enough time to undertake the various administrative actions in time for the reviewed rent to come into effect on 1 July 2029.
What effect will the new pastoral rent determination methodology have on Local Government rates, and the Biosecurity Levy?
Pastoral lease rents form the basis for the unimproved values, which are used as a basis for local government rates and biosecurity levies payable by pastoral lessees. The impact of the amended pastoral rents will vary between Local Government Authorities as each applies its own rates in the dollar. Similarly, biosecurity levy calculations vary across the various biosecurity groups, so the impact on them will also vary.