The Morrison government is set to hand environmental approval powers to the states and territories and introduce new national environment standards, after an interim review concluded the Environment Protection and Biodiversity Conservation Act did not allow the Commonwealth to protect Australia's iconic places and environment.

Professor Graeme Samuel, who is leading the review of the 20-year-old laws, said the act was "dated and inefficient".

"It is not fit to manage current or future environmental challenges, particularly in light of climate change," Professor Samuel said.

In particular, Professor Samuel said monitoring, compliance and enforcement under the laws was ineffective.

He said the enforcement powers under the act were outdated and restrictive and could only be applied in a piecemeal way.

The complexity of the act made it difficult to comply with and regulate, Professor Samuel said.

"This erodes public trust in the ability of the law to deliver environmental outcomes," Professor Samuel said.

The current collaborative approach to enforcement was too weak, Professor Samuel said.

"Serious enforcement actions are rarely used, indicating a limited regard for the benefits of using the full force of the law where it is warranted," he said.

"When they are issued, penalties are not commensurate with the harm of damaging a public good of national interest. They do not provide an adequate deterrent."

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Professor Samuel said there needed to a "strong cop on the beat" and recommended the laws be enforced by an independent regulator

"An independent compliance and enforcement regulator, that is not subject to actual or implied political direction from the commonwealth minister, should be established," Professor Samuel said in the review.

"The regulator should be responsible for monitoring compliance, enforcement and assurance. It should be properly resourced and have available to it a full toolkit of powers."

Later in a press conference with Environment Minister Sussan Ley though, Professor Samuel said he would not support an independent regulator carrying out approvals and assessments.

"I have recommended we need independent monitoring compliance and enforcement. That does not necessarily involve the establishment of a separate independent compliance body. What is does require is independence on the part of those vested with responsibility of compliance and monitoring," Professor Samuel said.

He suggested the states or even the secretary of the department had the degree of independence necessary to enforce the laws. There were also a number of independent agencies within the department which could perform that function.

"So it's not absolutely necessary that one has a completely independent regulator to deal with these issues, it can be dealt with, it's a matter of culture," Professor Samuel said.

"They're better served by having properly enforceable national environmental standards rather than setting up another bureaucracy."

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Ms Ley said government was unlikely to support an independent watchdog either.

"The commonwealth will take steps to strengthen compliance functions and ensure that all bilateral agreements with states and territories are subject to rigorous assurance monitoring. It will not, however, support additional layers of bureaucracy such as the establishment of an independent regulator," Ms Ley said in a statement.

However she later said she was "not ruling anything out in terms of how the department will be resourced to do this or what the model would look like".

"At this point we don't support additional layers of bureaucracy such as an independent regulator outside the system as it is there are actual models of independent regulators with my own Department of the Agriculture, Water and the Environment," Ms Ley told media.

However Australian Conservation Council chief executive Kelly O'Shanassy said both better regulations and independent enforcement was needed.

"It's like saying we're going to make this road 60 kilometres per hour but we won't enforce it, there'll be no police or speed cameras. How many people would actually go 60 km/ph?" Ms O'Shanassy said.

The release of the review follows the findings of a damning audit, which uncovered glaring deficiencies in the Environment Department's monitoring and enforcement arrangements.

Groups such as the Australian Conservation Foundation said the audit was proof Australia needed an independent regulator.

"Worryingly for an area of public policy in which commercial interests are constantly trying to influence, the Auditor-General found 'conflicts of interest are not managed'," Australian Conservation Foundation policy analyst James Trezise said in June.

The Humane Society said there needed to be an "independent regulator at arm's length from the government".

"Humane Society International has recommended reforms to federal environment laws which would make decision making more resistant to short term political pressures and make science based decisions in the interests of the long term public good," Humane Society International's head of campaigns Nicola Beynon said at the time.

Ms Ley said the government would adopt other recommendations made by Professor Samuel, including setting up new environmental standards as quickly as possible and remote duplication in state and territory environment laws by accrediting states to carry out environmental assessments and approvals on the Commonwealth's behalf.

Legislation to create the bilateral assessment system would be introduced next month, Ms Ley said.

Professor Samuel found the EPBC Act largely duplicated state and territory regulations for assessing and approving developments.

Under bilateral arrangements, the Commonwealth would retain responsibility for the approvals but the states would undertake the environmental impact assessments.

While there are already bilateral agreements in place in all states and territories, there were significant shortcomings in the arrangements, Professor Samuel said.

"For example, where states and territories do not actively assess certain development types - for example, code-based development - or where approvals are given by local councils under local planning laws, these activities are unable to be accredited under the current inflexible bilateral provisions," Professor Samuel said.

"For a single project, bilateral agreements may cover some aspects of the project, but not all. For example, not all clearing of habitat of nationally threatened species can be accredited due to the way state and territory land clearing laws are constructed."

However the Australian Conservation Foundation raised serious concerns about devolving environmental approval powers to the states.

"Right now state environmental protection standards are weaker than the national standards and improving them will take some time," Ms O'Shanassy said.

"Federal regulation is important because the federal government has responsibilities over nationally and internationally important species and ecosystems like the Great Barrier Reef. Without federal regulation, the Franklin River, a World Heritage Area, would be dammed. Moreton Bay will be destroyed for a marina and apartment complex. The Mary River Turtle would likely be added to the extinction list."

The new environmental standards would also commence in August.

Ms Ley said the new legally enforceable standards would not be written in her department or office.

"I want them to be written with the engagement of so many people," she said.

Professor Samuel said the standards, which should be legally enforceable regulatory instruments, must be the foundation of "fundamental reform" of the national environmental laws.

"Precise, quantitative standards, underpinned by quality data and information, will support faster and lower-cost assessments and approvals, including the capacity to automate consideration and approval of low-risk proposals," he said.

The statutory review is the second to examine Australia's flagship environmental laws, which were introduced in 2000. The final review will be handed down in October.

Prime Minister Scott Morrison has spoken extensively about the need to streamline environmental approvals ahead of the release of the review, in order to drive investment after the coronavirus pandemic.

Ms Ley said it was unsurprising to hear the laws were not meeting the needs of the environment, agriculture, community planners and business.

"This is our chance to ensure the right protection for our environment while also unlocking job-creating projects to strengthen our economy and improve the livelihoods of everyday Australians. We can do both as part of the Australian government's COVID recovery plan," Ms Ley said.