Water Corporations Act 1995

The central concept is the “corporation” as defined in section 3(1). That definition encompasses the three bodies established by subsections 4(1), (2) and (3) - the Water Corporation, Bunbury Water Corporation and Busselton Water Corporation - as well as any body established by the Governor under section 4(4). Each corporation is a body corporate with perpetual succession (section 5A(1)), but it is not an agent of the Crown and does not have Crown immunities (section 5). This is a deliberate departure from a government department model. Relatedly, the corporations are not within the public sector: section 6(1) says a corporation is not and is not to become a public sector body under the Public Sector Management Act 1994, and section 6(2) excludes the CEO and staff from the Senior Executive Service. The Act defines “water service” by reference to the Water Services Act 2012, section 3(1). The “GTE Act” is the Government Trading Enterprises Act 2023, and section 3A requires that it be read with this Act as a single Act. This is a critical interpretive direction: governance, financial management, and reporting obligations that might have been in this Act are now to be found in the GTE Act unless otherwise specified. Indeed, the 2023 amendments deleted entire Parts (4 and 5) and many sections, shifting those matters to the GTE Act. The concept of “function” is defined broadly in section 3(1) as including powers, duties, and authorities, except in sections 27(1), (2) and (4) and 29 where the word “function” is used more narrowly. The functions themselves are set out in section 27, with a strong commercial orientation: not only the core water and wastewater services, but also provision of services for profit, exploitation of intellectual property, and marketing of by-products. The concept of “surplus water” is defined in section 27(7) as storm water, surface water, or underground water that accumulates to the detriment of any person; “wastewater” takes its meaning from the Water Services Act. The Act also introduces the concept of “operating area” for regional water corporations in section 7(1), which means the operating area of a licence held under the Water Services Act. For the Bunbury Water Corporation and the Busselton Water Corporation, the Act requires that when appointing board members, the Minister must ensure, to the extent practicable, that the number of directors not ordinarily resident in the operating area does not exceed the number who are (section 7(2)). This residency balance requirement is unique to the regional corporations and does not apply to the Water Corporation.

The Act directly affects four categories of entities and persons. First, the three water corporations themselves: the Water Corporation, Bunbury Water Corporation, and Busselton Water Corporation, along with any new corporation the Governor may establish under section 4(4). Each corporation is a separate legal entity with its own board, CEO, and staff. Second, the boards of these corporations are affected in multiple ways. The board engages and manages staff (section 15(1)), determines remuneration and terms (section 15(2)), must prepare minimum staff management standards and codes of conduct (sections 16 and 24), must report to the Public Sector Commissioner on observance of those standards when required (sections 17 and 25), and must deliver a separate annual report on code observance to the Minister alongside the GTE Act annual report (section 26). For the Bunbury and Busselton corporations, there is a special requirement for board composition relating to residency (section 7(2)). Third, the staff of the corporations are directly affected. Their remuneration and conditions cannot be less favourable than applicable awards, orders, or agreements under the Industrial Relations Act 1979 or the Minimum Conditions of Employment Act 1993 (section 15(3)). They are subject to staff management standards of merit, equity, and probity (section 16) and codes of conduct (section 24). The chief executive officer is included in the definition of “members of staff” for the purposes of the codes of conduct (section 24(4)), and the instrument under section 16 may be expressed to apply to the CEO as if they were a member of staff (section 16(4)). Fourth, external oversight bodies are affected: the Public Sector Commissioner has a supervisory role over staff management standards and codes of conduct (sections 16, 17, 24, 25, 26), the Minister receives reports and appoints board members (section 7, section 26), the Treasurer must concur to the establishment or dissolution of corporations (sections 4(5), 7A(1)) and may delegate powers to Treasury officers (section 90), and the Governor makes regulations (section 91) and orders dissolving bodies (section 7A) or approving arrangements (section 36). The transitional provisions in Schedule 5 affect former members of the Bunbury Water Board and Busselton Water Board, who became directors of the relevant corporations (clause 5), and former officers of those boards, who became staff of the corporations with preserved rights (clause 9). Persons engaged under contracts for services by former boards also become contractors to the corporations (clause 13). Entities that hold interests in land that were previously vested in former water authorities may be affected by vesting orders under section 92.

The Act imposes several key duties on the corporations, their boards, and staff, and also confers significant rights and powers. Under section 15(1), the board has the power and duty to engage and manage staff, including determining remuneration and terms and conditions (section 15(2)). The board must, after consultation with the Public Sector Commissioner, prepare and issue an instrument setting out minimum standards of merit, equity, and probity for staff management (section 16(1)). The board must have regard to the principles in section 8 of the Public Sector Management Act 1994 when doing so (section 16(3)). The board may amend or revoke that instrument, but only after further consultation with the Commissioner (section 16(6)). The board also must prepare and issue codes of conduct setting out minimum standards of conduct and integrity for staff, after consultation with the Commissioner, having regard to the principles in section 9 of the Public Sector Management Act (section 24). The board must report to the Public Sector Commissioner on observance of the codes when required, but not more often than half-yearly (section 25). And the board must deliver a separate report on code observance to the Minister at the same time as its annual report under the GTE Act section 81, with a copy to the Commissioner (section 26). The board must also comply with any requirement from the Commissioner to report on observance of the staff management standards (section 17). Corporations have extensive powers under section 29: they may do all things necessary or convenient for performing their functions, including acquiring, holding, and disposing of property; entering into contracts or arrangements (including for the performance of their water functions by others); applying for licences; acquiring and operating undertakings; producing and dealing in by-products; appointing agents; participating in business arrangements (including companies, partnerships, trusts, joint ventures); carrying out investigations and research; applying for and exploiting intellectual property; and promoting and marketing themselves. They may also make gifts for charitable purposes, make ex gratia payments the board considers in the corporation’s interest, and accept gifts (section 29(3)). However, these powers are subject to the GTE Act (section 29(2A)), and if the generality of a power is restricted by the Water Services Act, that restriction applies despite this Act (section 29(4)). A corporation may delegate any of its functions (except the power to delegate) to a director, the CEO, a member of staff, a committee established under the GTE Act, or any other person (section 35). The delegate may not subdelegate unless expressly authorised. Delegates perform functions as if by the corporation (section 35(4)). However, section 35 does not apply to execution of documents; authority for that is given under the GTE Act section 156 (see note to section 35). The Treasurer may delegate functions vested in him or her by this Act to an officer of the Treasury (section 90).

The Act as currently in force contains no provisions that prescribe penalties, fines, or criminal offences. The original text of the Act and many of its earlier amendments included penalty provisions in various sections, but those sections have been systematically deleted. For example, sections 30 to 34 were deleted by the 2012 amendments, and sections 37 to 40, Parts 4 and 5, and sections 88 to 89 were all deleted by the 2023 Government Trading Enterprises Act amendments. The remaining substantive provisions are purely constitutive, functional, and administrative. The only remaining reference to penalties is in the review mechanism: section 93(1)(a) requires the Minister, when carrying out the five-yearly review of the operation and effectiveness of the Act, to consider and have regard to “the adequacy of the penalties imposed under this Act.” This provision was inserted by the Water Services Legislation Amendment and Repeal Act 2012, but since that time the penalty provisions have been removed. Therefore, the current Act imposes no penalties directly. Enforcement of compliance with the Act’s duties is achieved through other mechanisms. For example, the Public Sector Commissioner may require the board to report on observance of staff management standards and codes of conduct (sections 17(1) and 25(1)), and may report to the Minister on any matter relating to observance (sections 17(3) and 25(3)). The board must deliver a separate annual report on code observance (section 26). Non-compliance with those reporting requirements or with the duty to prepare the standards and codes could potentially give rise to ministerial direction or other consequences under the GTE Act, which is read as a single Act with this Act. The Water Services Act 2012, which governs licensing and service standards, contains its own penalty and enforcement provisions. Section 29(4) of this Act provides that if a restriction in the Water Services Act applies, it prevails over this Act, so regulatory enforcement would occur under that Act. Additionally, regulations made under section 91 may prescribe matters; the Act gives power to make regulations that can prevail over GTE Act regulations (section 91(3) to (5)), but no penalty provisions are currently specified in the Act itself for breach of regulations. The transitional regulations under clause 21 of Schedule 5 may contain savings or transitional provisions but do not impose penalties. In summary, the Water Corporations Act 1995 is a framework statute without its own penalty regime; accountability is achieved through superior legislation and the GTE Act.

The Act interacts with several key Western Australian statutes, and section 3A establishes the primary interpretive relationship: the GTE Act is to be read with this Act as if they formed a single Act. This means that the governance, financial, and reporting provisions of the GTE Act apply to the corporations as if they were part of this Act. For example, the board of a corporation is now subject to GTE Act provisions on directors’ duties, board committees, and financial reporting, while the Water Corporations Act retains the specific staff management and code of conduct requirements. Section 29(2A) expressly states that the powers of a corporation under section 29(1) and (2) “have effect subject to the GTE Act.” The interaction with the Water Services Act 2012 is also significant. The term “water service” is defined by reference to that Act (section 3(1)), and section 27(3) provides that if performance of a function under section 27(1)(a) or (b) requires the corporation to hold a licence under the Water Services Act, the corporation may only perform that function in accordance with the terms and conditions of such a licence. Section 29(4) provides that if the generality of a power in this Act is restricted by a provision of the Water Services Act, that restriction applies despite this Act. This gives the Water Services Act supremacy in licensing and service matters. The Act also interacts with the Public Sector Management Act 1994 in a limited but specific way. Although corporations and their staff are not part of the public sector (section 6), the boards must have regard to the principles in sections 8 and 9 of the Public Sector Management Act when preparing staff management standards and codes of conduct (sections 16(3) and 24(2)). The Public Sector Commissioner has oversight and reporting functions under sections 16, 17, 24, 25, and 26, but this oversight does not bring the corporations into the public sector. The transitional provisions in Schedule 5 create a special interaction with the Public Sector Management Act for staff who elected to return to the public sector (clauses 10 to 12). The Act also interacts with the Land Administration Act 1997: section 92 allows the Minister to vest an estate or interest in land in the Water Corporation, or to place care, control, and management of a reserve with the Water Corporation under section 46 of that Act. The Financial Management Act 2006 applies to financial reporting for the transitional period under clause 16(2). Section 91(2) provides that if there is conflict between regulations under this Act and regulations under the Water Agencies (Powers) Act 1984, a relevant Act, or the Water Services Act, the latter regulations prevail. However, regulations under this Act may be expressed to prevail over GTE Act regulations (section 91(3) to (5)), subject to a dual ministerial recommendation.

The Act was originally enacted as the Water Corporation Act 1995 (No. 70 of 1995), commencing on 1 January 1996. Its short title was changed to Water Corporations Act 1995 by the Water Services Legislation Amendment and Repeal Act 2012 (No. 25 of 2012). The compilation table in the Act records numerous amendments. Notable early amendments include the State Enterprises (Commonwealth Tax Equivalents) Act 1996, the Acts Amendment and Repeal (Financial Sector Reform) Act 1999, the State Superannuation (Transitional and Consequential Provisions) Act 2000, the Corporations (Consequential Amendments) Act 2001 (which updated references to corporations law), the Labour Relations Reform Act 2002, and the Economic Regulation Authority Act 2003 which amended section 27 and the regulations power. The Water Resources Legislation Amendment Act 2007 (No. 38 of 2007) made amendments. The most significant structural amendments came from two Acts: first, the Water Services Legislation Amendment and Repeal Act 2012 (No. 25 of 2012), which came into operation on 18 November 2013. That Act changed the short title, inserted the definition of “Water Services Act” and “water service”, established Bunbury Water Corporation and Busselton Water Corporation as bodies corporate (sections 4(2) and (3)), added the power to establish further corporations (section 4(4)), inserted section 5A (nature of corporations), amended sections 5 and 6 to reinforce non-Crown and non-public-sector status, inserted section 7A (dissolution of bodies established by Governor), inserted a new Part 2 Division 2 on board members (including the residency requirement), rewrote staff provisions, updated the functions and powers, inserted section 92 (land vesting), section 93 (review), and section 94 (transitional provisions), and added Schedule 5 with detailed transitional arrangements for the former boards and their staff. More recently, the Government Trading Enterprises Act 2023 (No. 13 of 2023) came into operation on 1 July 2023. This was a major reform. It inserted section 3A (relationship to GTE Act), added the definition of “GTE Act” and “regional water corporation”, deleted sections 8-12 (former board provisions), 13-14 (former CEO provisions), 18 (former CEO appointment), 20-23 (former code provisions), 28A, 28 (former board functions and indemnity), 30-34, Division 3 of Part 3 (sections 37-40), whole Parts 4 and 5 (sections 41-86), sections 88-89, and Schedules 1-4. It also amended sections 16(4A), 26, 35 (adding note about GTE Act section 156), 87, 91, and various transitional provisions. The effect was to move most governance, accountability, and financial provisions into the GTE Act, leaving the Water Corporations Act as a slimmed-down constitutive and staff code statute.

The Act itself does not record any litigation history. The compilation notes and the body of the Act contain no references to court decisions, judgments, or legal proceedings. As a matter of standard practice, the Act’s text does not include a litigation history. However, it is notable that the Act’s provisions are mostly administrative and organisational, and disputes involving the water corporations are likely to arise under the Water Services Act 2012 or in contract and property matters rather than under this Act itself. The transitional provisions in Schedule 5, particularly those concerning the continuation of former boards and the transfer of staff, could potentially generate disputes about continuity of employment, rights, and liabilities, but no such case law is referenced in the source. The review mechanism in section 93 has not produced public litigation. In the absence of any citation in the provided text, an analyst must state that the source does not disclose any litigation history. This is a statute that has been significantly amended to shift operational content to other Acts, and the remaining provisions are unlikely to be the subject of independent judicial interpretation. The only possible exception is section 7(2), which imposes a residency requirement on regional water corporation board appointments; that provision could theoretically be challenged if the Minister is alleged not to have complied, but no such case is reported in the source.

The Act contains several provisions that may catch practitioners off guard. First, the definition of “function” in section 3(1) includes powers, duties, and authorities, but this definition does not apply to sections 27(1), (2) and (4) and 29. In those sections, “function” has a narrower meaning, so a power under section 29 is not itself a function for the purposes of delegation or other provisions that refer to “functions”. Second, although the corporations are not agents of the Crown and are not public sector bodies (sections 5 and 6), they are still subject to oversight by the Public Sector Commissioner for staff management standards and codes of conduct. This creates a hybrid: the corporations are outside the public sector but must consult with and report to the Commissioner, and must have regard to Public Sector Management Act principles. Failure to appreciate this could lead to non-compliance. Third, the power to establish a new corporation under section 4(4) requires the concurrence of the Treasurer (section 4(5)); similarly, dissolution of such a body requires the Treasurer’s concurrence (section 7A(1)). This is a significant practical hurdle. Fourth, the delegation provision in section 35 does not apply to the execution of documents; that is governed by the GTE Act section 156 (see note to section 35). Practitioners must not rely on section 35 for signing powers. Fifth, section 29(4) provides that if the generality of a power in this Act is restricted by a provision of the Water Services Act, that restriction applies despite this Act. This means the Water Services Act can cut back on the apparently broad powers in section 29. For example, if the Water Services Act limits the way water services can be supplied, that limit overrides the corporation’s general power. Sixth, the residency requirement for regional water corporation board appointments (section 7(2)) is a soft requirement: the Minister must comply “to the extent practicable”. It does not create an absolute obligation, so a challenge would need to show it was practicable but ignored. Seventh, the Act’s review mechanism under section 93 refers back to the commencement of the 2012 amending provisions; the review is to be carried out “after every fifth anniversary” of that commencement (18 November 2013). The first review would have been due by late 2018, the second by 2023. Practitioners should check whether these reviews have been completed and reports laid, as that is a statutory duty on the Minister. Eighth, the transitional provisions in Schedule 5 give extensive powers to make transitional regulations that can override the Act itself (clause 22: “provisions of the regulations made for the purposes of this Division prevail over the provisions of this Division to the extent of any inconsistency”). This is a strong subordinate legislative power, and regulations may have altered the operation of the Act without amending the primary text. Ninth, the Act’s relationship with the GTE Act under section 3A means that many governance duties are now in that Act; a person reading only the Water Corporations Act will miss requirements such as those for statements of corporate intent, financial management, and board duties. Always consult the GTE Act. Finally, section 91(3) to (5) allows regulations under this Act to be expressed to prevail over GTE Act regulations, but only on the recommendation of both the Minister and the Minister administering the GTE Act. This is an unusual override power that should be checked if regulations are made.

Compliance with the Water Corporations Act 1995 requires attention to several specific statutory obligations that remain after the 2023 amendments. The board of each corporation must ensure that it has prepared and issued, after consultation with the Public Sector Commissioner, an instrument setting out minimum standards of merit, equity, and probity applicable to the management of staff (section 16(1)). The board should document the consultation process. The instrument must have regard to the principles in section 8 of the Public Sector Management Act 1994 (section 16(3)). The board may make the instrument apply to the CEO (section 16(4)). The board must also prepare and issue, again after consultation with the Commissioner, a code or codes of conduct for staff setting out minimum standards of conduct and integrity, having regard to the principles in section 9 of the Public Sector Management Act (section 24). The board must ensure that these documents are kept current and reviewed; amendments or substitution also require consultation with the Commissioner (section 16(6) and 24(3)). The board must comply with any written requirement from the Public Sector Commissioner to report on observance of the standards (section 17) and on observance of the codes (section 25). Reports cannot be required more often than half-yearly. The board must also deliver a separate report on code observance to the Minister at the same time as it delivers its annual report under the GTE Act section 81, and must give a copy to the Public Sector Commissioner (section 26). That separate report should cover the period of the annual report and detail compliance with the codes. The board should maintain records of its compliance and report preparation. For the Bunbury Water Corporation and Busselton Water Corporation, the Minister must ensure that when appointing board members, the number of directors not ordinarily resident in the operating area does not exceed the number who are, to the extent practicable (section 7(2)). While the obligation falls on the Minister, the corporation’s board should be aware of this requirement and, if asked, provide information about residency. The board must also ensure that the remuneration and other terms of employment of staff are not less favourable than provided for in applicable awards, orders, or agreements under the Industrial Relations Act 1979, or the Minimum Conditions of Employment Act 1993 (section 15(3)). The board should engage staff and manage them in accordance with the instruments and codes it has issued. The board may delegate functions under section 35, but must do so by written instrument and cannot delegate the power to delegate; delegates cannot subdelegate unless expressly authorised. The delegation must note that it does not apply to execution of documents (section 35(7) note). For document execution, the corporation must follow GTE Act section 156. If the Governor establishes a new corporation under section 4(4), the corporation must comply with all the above obligations from the date of its establishment. The board should also be aware that the Act is to be read with the GTE Act (section 3A), so compliance with the GTE Act’s requirements for statements of corporate intent, financial reports, board duties, and ministerial oversight is mandatory. The board should retain copies of consultation correspondence with the Public Sector Commissioner, the staff management standard instrument, the codes of conduct, and the annual separate report on code observance to demonstrate compliance if questioned.