Contracts can be re-negotiated for the change. Rates can be increased. This is just another cost to doing business.
I don't suppose you think other costs remain constant and "budgets" once put into place are etched in stone?
US Law affords protection for Contractors in this kind of situation. A good Contracting practice is to include Language that sets up that protection.
Sample language.....which would be a Sub-Paragraph under Contract Modifications.
In the event of any change in any applicable statute, rule, regulation, ordinance, or other law or any order or directive or interpretation of any applicable governmental authority or regulatory body which, invalidates or is otherwise inconsistent with the terms of this Agreement or that would cause one or both of the parties to be in violation of the law, the parties shall negotiate in good faith in an effort to agree on appropriate revisions to this Agreement. If the parties have been unable to do so within thirty (30) calendar days of commencing such negotiation, either party may elect to terminate this Agreement upon sixty (60) calendar days written notice to the other party.
A Contractor cannot be compelled to perform under a Contract that would constitute a Violation of Law. Changes in the Law require both the Operator and Customer to make such changes required for each/both to be in compliance with the new Law.
Does not Australian Law not have the same foundation for Contract Law?