Proposed Levy FAQs
Who is Dams Safety NSW?
Dams Safety NSW is the independent regulator with responsibility for the safety of declared dams in NSW.
Established on 1 November 2019 under the Dams Safety Act 2015, Dams Safety NSW makes decisions on how the legislation is administered.
Which dams do Dams Safety NSW declare?
Dams Safety NSW “declares” dams that have a potential to endanger downstream life, cause major damage or loss to infrastructure, the environment, or have major health and social impacts. Once a dam is declared, the dam owner must comply with the requirements of the Dams Safety Act 2015 and the Dams Safety Regulation 2019.
How many declared dams are there in NSW?
There are about 400 declared dams in NSW. These dams are owned by mining companies, State-owned corporations, Government agencies and enterprises, local councils and private owners.
Why are we considering introducing the declared dams safety levy?
The NSW Government is considering introducing the levy to fund the ongoing regulatory activities of Dams Safety NSW, specifically in relations to the administration of the Dams Safety Act 2015.
An independent review by KPMG recommended that it would likely drive more prudent and efficient regulatory costs if the dams safety regulator were funded by risk creators, which are the owners of declared dams.
A levy is a fairer way to ensure costs of regulatory activities are borne by those creating the need for regulation (rather than all taxpayers).
When is the levy proposed to be introduced?
The NSW Government is considering introducing the levy on 1 July 2021.
Who would pay the levy?
All owners of a declared dam in NSW would pay the annual levy, if it were introduced.
How much would declared dam owners pay?
The proposed levy would range from $5,050 per annum for a low consequence declared dam to $16,900 per annum for an extreme consequence declared dam. Declared dam owners would be invoiced annually. Where a declared dam owner has more than one declared dam in their portfolio, the owner would receive a 30% reduction on subsequent dams to reflect the costs of regulatory activity.
How was the proposed levy calculated?
The proposed levy was calculated on the ‘consequence category’ of the declared dam as the primary driver of cost. The levy varies according to the level of risk presented by the dam as measured by the consequence category. Dams with higher consequence categories are expected to require more staff time and more intensive regulatory activities than other dams with lower consequence categories.
Consistent with best practice principles, the proposed levy consists of an annual amount related to:
- Regulatory oversight – gathering and analysing information on a specific dam or range of dams, for example through audit, to test compliance with the NSW dams safety regulatory framework, to review reports submitted by dam owners including dams safety standards reports, risk rating reports, and consequence category assessments
- Educating and informing dam owners and supporting industry including responding to enquiries, developing regulatory guidelines, reports and information sheets, developing resources for dam owners, webinars, newsletters and website material
- Promoting collaboration between dam owners in terms of knowledge and expertise sharing and between regulators, in terms of best practice strategies and experiences
- Dealing with non-compliance – actions such as warnings, orders, directions, penalty notices, prosecutions and emergency situations.
Why is there a proposed 30% reduction for dam owners with multiple dams?
Where a declared dam owner has more than one declared dam in their portfolio, the owner will receive a 30% reduction on subsequent dams to reflect the reduced costs of regulatory activity due to shared management. These efficiency gains can be achieved by auditing one dam safety management system for a dam owner with multiple dams in their portfolio, auditing multiple dams within a region to minimise travel time, or auditing legislative requriements at the same time.
When would my payment for the levy be due?
We are proposing to invoice each dam owner at the start of May each year. Payment of the invoice would be due by 31 July each year.
How would Dams Safety NSW be held accountable?
As a NSW Government agency, Dams Safety NSW is subject to a number of existing accountability mechanisms.
- The Act strictly limits how levy funding can be used. It can only be used for expenses incurred by Dams Safety NSW in carrying out regulatory activities connected with dams safety legislation, expenses incurred in the administration or execution of dams safety legislation, or administrative expenses related to the levy fund
- Dams Safety NSW is accountable to the Government for its costs through annual reports and independent audit of its financial statements
- Dams Safety NSW is accountable to the NSW Parliament, including parliamentary scrutiny.