Lecture 6 - Professor Mary Walsh PDF

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Week 6 Lecture Federalism    Division of Powers - s51 and s52   The Australian Federal System  Federalism is a mechanism for sharing power and responsibilities between levels of government.  Federalism is outlined in s51 and outlines the roles of the levels of government and protects th...

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Week 6 Lecture Federalism 

Division of Powers - s51 and s52

The Australian Federal System  Federalism is a mechanism for sharing power and responsibilities between levels of government.  Federalism is outlined in s51 and outlines the roles of the levels of government and protects them from each other so they may retain their sovereignty.  Federalism is characterised by a division of powers, shared sovereignty and financial independence.  There is the possibility of policy overlap and conflict over responsibilities particularly where there is ambiguity over which level of government is responsible. 

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Australian federalism is a particular type of federalism that comprises three tiers of government - federal, state and local, although only the federal and state political executives have sovereignty. Local government is recognised and represented at the Council of Australian Governments (COAG) meetings. Members of state political executives create and can dissolve local government bodies. NT & ACT are governed in the same way as a state but receive their power via and act of parliament who can remove those powers in a later act.

Division of Powers  Refers to the different powers that are formally given to different levels of government.  Division of Powers is an idea that practice that is essential to federalism and the Constitution of a federation must provide some sense of which level of government will have jurisdiction and control over aspects of people's lives.  Some powers of the Constitution are concurrent which means that members of Parliament of both levels of government can make laws on these matters, although if there is a dispute, the federal government prevails.   

The division of powers in a federation is not always clear. The Constitution gives specific powers to members of federal political executives, and the rest, which are referred to as residual powers, belong to the state. The Constitution also lists the concurrent powers which are shared between levels of government which include international and domestic trade, taxation, postal services, census and statistics, quarantine, immigration, currency, invalid and old age pensions, copyright and defence.

Horizontal Fiscal Imbalance (HFE)  Introduced in 1933 to compensate states with lower revenue raising capacity.  In Australia, objective is full equalisation between states.  Means that all six states and two territories have the capacity to provide services and infrastructure at the same standard.  HFE comes from the GST.

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The distribution of money is decided by the federal treasurer on advice from the Commonwealth Grants Commission. States are not directed on how to spend this money - it is 'untied' and can be used for purposes deemed by the States. Key is HFE equalises fiscal capacity not policy which is decided by the States.

Vertical Fiscal Imbalance  Members of state political executives retain some measure if financial independence, although this has changed somewhat with the High Court decision in the Uniform Tax case where federal Parliament can prevent members of state political executives from collective income tax.  Although members of state political executives collect monies through land, payroll and gambling taxes.  This situation has produced an ever increasing vertical fiscal imbalance between federal and state governments as most money is collected at the federal level. 

Members of the federal political executive have exploited the situation by creating specific purpose grants (also known as 'tied' grants) that impose certain condition be met if funds are to be provided for a specific program.

Permanence of a Federal System  Four main reasons 1. 2. 3. 4.

Australians are conservatives and don't want to change their political system. Constitutional Change (s128). State Politicians. Australian Political Parties (states are central to their organisation).

Is a Federal System a Sensible Way to Organise Government?  Division of Power o Yes  Because the division of power is a check on government. o No  Because the division of power prevents effective government. 

Responsibility o Yes 

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Because it makes sense for different levels of government to have responsibility for different aspects of people's lives.  Because it makes sense for responsibility over areas that are more central to people's lives to be given to those closer to the people. No  Because it creates confusion as to which Parliament has responsibility for a particular aspect of people's lives

Efficiency o Yes 

Members of political executives that are close to the people are better able to identify and satisfy needs.

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Because members of different political executives compete with each other to demonstrate efficiency. No  Because federal system results in over-government and duplication.  Because of a lack of mechanism for coordinating government.

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Written Constitution o Yes  Because the written Constitution is the basis for government.  Because the written Constitution allows the High Court to preside over Australian politics. o No  Because a written Constitution is hard to change.  Because a written Constitution allows the High Court to determine political outcomes.

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Four main issues

1. Representation of individuals. o Yes  Produces greater opportunities for representation o No  Because it results in representation fatigue, creates confusion for people that don't understand politics.  Because it creates confusion for people who do not understand the political system. 2. Representation of communities. o Yes  Because states represent meaningful communities.  Federal system protects those in less populated states. o No  Because the states don't reflect communities.  Because it penalises those in more populated states. 3. Reflection of popular will. o Yes  Because it creates two levels of connection between people and political structures,  Because it gives more responsibility to those governments closer to people and allows them to determine their lives. o No  Because it divides people's will.  Because it sets one popular will against another popular will. 4. Accountability. o Yes  

Because there are more opportunities to hold politicians to account. Because different levels of government publicise the failures of the other levels.

No -

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Because of confusion with respect to responsibility. Because of vertical fiscal imbalance in the Australian federal system.

Council of Australian Governments  COAG "is the peak intergovernmental forum in Australia, comprising the Prime Minister, State Premiers, Territory Chief Ministers and the President of the Australian Local Government Association (ALGA)."    

A month after the 2007 federal election, COAG met for the first time on 20 December 2007. Then PM Kevin Rudd announced that COAG would be a forum that would be the 'workhorse for a nation.' This first meeting sought to draw up a new program of reform that would be finalised mid-2009. The then PM proposed "unprecedented federal involvement."

COAG 2012  Specifically addresses the State level increases in electricity prices and the misapprehension that this somehow linked to the carbon price.  Education reforms and funding.  Health and dental.  NDIS. COAG 2013-14  The National Economy.  Closing the Gap in Indigenous Disadvantage.  Disability Care and Support.  Infrastructure and Transport. COAG 2016  Hospital funding and health reform.  Schools.  A more efficient federation for all Australians.  Competition reform.  Indigenous economic development.  Reducing violence against women and children.  Counter terrorism.  NDIS.  Medicinal Cannabis.  Northern Territory Statehood. Turnbull Government and COAG  What have been the priorities in 2017? (met un Hobart 9 June 2017) 1. National responses to terror and security threats. 2. Improving economic and social outcomes. 3. Indigenous Affairs 4. Murray Darling Basin 5. Developing Northern Australia....