Is harmonisation a euphemism for subjugation of the states?

Peter Phelps is a new member of the NSW Legislative Council.

As is the wont of maiden (or, as they are now grandly called, so as not to offend maidens, inaugural) speeches, the new member canvassed a number of different issues.

Perhaps unusually for a state MP making his first speech, he wondered about the point of maintaining the concept of provincial government, making some of the usual observations:

What relevance do the States then have? Not much by any assessment. They are too small to encompass the cultural and too large to encompass genuine communities of interest. To that end, Alex Hawke, who is in the public gallery today, kindly faxed me a copy of Jack Lang's 1930 Abolition Bill, with the suggestion that it would be an excellent first private member's bill for me to introduce. I doubt whether I will be taking him up on that offer at this time.

But if we are just going to be a way station for the Federal Government and its dictat, then why not? Why not abolish the Legislative Council and the Legislative Assembly. Why not abolish the State Government entirely? What purpose do we serve if we are straight-jacketed within federally mandated systems of education, water, land use, fishing, and environmentalism? Since the engineers case, the High Court has permitted a gradual accretion of power and interference in State matters.

Harmonisation has become a euphemism for subjugation. What is the use of this? Are we simply an imperial bauble perched atop a colonial anachronism, the errand boys of the Federal Government? If States are to remain relevant we must fight for real competitive federalism—not cooperative federalism—with genuine competition between the States, not this collectivist begging bowl approach. If you want to be a pot smoking Mullumbimby hippie, fine—but do not expect me to subsidise your lifestyle. Similarly, if a State has resources that are left unused, why should it expect us to subsidise a lifestyle for which it is unwilling to pay? If the distribution of revenue to the States was done on the basis of direct parity with its collection, then fine. It is not perfect but at least it would be a just outcome. But at this time horizontal fiscal equalisation, as it is called, is just an excuse to rob the productive to pay the lazy.

Whether through grand design or humorous coincidence the very next business in the Council was the thrillingly named Miscellaneous Acts Amendment (Director’s Liability) Bill 2011

The reason for introducing the legislation was because:

(t)hese amendments will ensure that New South Wales legislation imposing this type of liability accords with the set of principles agreed by the Council of Australian Governments [COAG] to guide the reform and harmonisation of directors' liability across Australian law.

As the Attorney-General said in the Legislative Assembly:

I thank honourable members for their contributions to the debate. In particular I thank the member for Liverpool, who said the Opposition does not oppose the legislation, which we are pleased about because it is important Council of Australian Governments [COAG] legislation. In response to the member for Liverpool, these reforms are part of a COAG National Partnership Agreement under which there are reward payments to the States for achieving key milestones.

One of these key milestones was for legislation implementing these reforms by December 2010. The Liberal-Nationals Government was not in office at that time. However, perhaps we can get some brownie points, because these milestones may be reviewed by COAG and there may be a second tranche of reforms at a later stage.....

Somewhat proves Phelps’ point, really.

There have been some developments in the federalism debate recently. They are discussed in the next couple of articles.

Forget What We Said Earlier: COAG, Still the Fourth Tier of Government

We have previously noted that some people such as WA Premier Colin Barnett have suggested that COAG is becoming another tier of government.

The content of the COAG communiqué of 13 February 2011 suggests the tendency is continuing.

The main event was the signing of the Heads of Agreement on National Health Reform

However, other matters were dealt with.

A National Vocational Education and Training Regulator is to be established to ‘drive better quality standards and regulation across the Australian VET sector'.

This new body will join the Australian Health Practitioners Regulatory Agency, the National Occupational Licensing Authority and the Australian Curriculum Assessment and Reporting Authority as brand new national bodies to drive and determine a single set of national standards.

Another decision was to speed up the Seamless National Economy from June 2013 to December 2012, with options to be developed for a further wave of regulatory and competition reforms.

This will undoubtedly lead to the development of more national regulation.

However, the most interesting development was the establishment of Standing Councils to operate under COAG, designed to:

undertake legislative and governance functions relevant to their scope, and provide an annual report to COAG which includes an overview of the decisions made by the Council. (our emphasis)

The idea is to:

….(provide) a clear role for Ministers from all jurisdictions to support COAG in tackling 21st century policy challenges. There will be sustained collaborative effort on the long-term reform agenda while allowing for the flexibility needed to address more urgent challenges.

However, this classic ‘executive federalism’ model of governance suffers from one significant deficiency – ‘democratic deficit’.

The somewhat murky structure of the proposed new ministerial council process makes it difficult to see how anyone interested in a policy matter (other than larger players with the capacity to maintain a Canberra presence) will have the capacity to adequately participate in the regulation development process.

More particularly, once a COAG Council has ‘undertaken a legislative function’ (which presumably means approving a draft national law to be passed by (usually) state parliaments) one fears the opportunity to amend what could be a bad law will be limited because as COAG (or, in this case, a National Council of COAG) said a law has to pass, and so it will.

We harbour sincere doubts that this manner of rule making will necessarily lead to better laws.

However, one thing illustrated by the COAG communiqué is that even though Council membership may no longer be wall to wall Labor, the introduction of non-Labor members has not changed the function of COAG as another tier of government determining the rules of the Australian federation without any parliamentary oversight.

Plus ca change, plus c'est la meme chose.

COAG Meets in Darwin and Paul Everingham scrubs the States

COAG met in Darwin on July 2.

The previous day – Territory Day - the NT News reported comments from the ‘father of Self Government’ Paul Everingham which said that states and territories were a waste of taxpayer money and that the Northern Territory should be run out of Canberra.

He was reported as saying that when self-government for the NT was granted 31 years ago:

‘Back then people were still getting telegrams…but communication has improved. It is the internet age. People can also fly everywhere on relatively cheap airlines'.

This is a more earthy way in expressing something we have mentioned in an earlier article:

Many will say the Seamless Economy Project is good idea - Australia is an integrated common market, with people and companies commonly undertaking activities across state borders.

Moreover, Australia exists in a globalised world, with the complication of different rules in different states a reason not
to come to Australia.Regulatory difference is nothing more than a mere compliance cost that distort allocative efficiency with no public benefit.

The majority of the COAG decisions appear to underline the Everingham view of the world.

Those decisions include:

1. the development of a national regulatory body for vocational education and training;
   
2. the development of a unified national system of child care licensing;
   
3. the Coordinator-General mechanisms set up by the Commonwealth to take responsibility for Nation Building programs and projects funded by the Commonwealth and delivered by the States under the Building Australia Fund, the Education Investment Fund and the Health and Hospitals Fund;
   
4. the creation of national regulation for maritime safety, rail safety and heavy vehicles, including the appointment of the Australian Maritime Safety Authority as the national safety regulator for all commercial shipping in Australian waters and a single national heavy vehicle regulator; and
   
5. the development of national performance measures for development applications (DA).
   

Quite a list really for one COAG, really.

And there are other Ministerial Councils working on uniform legislation.

For instance, the Standing Committee of Attorney-Generals (SCAG) is working on the issue of whether there should be a national regulator for the legal profession, as well as on uniform succession laws on administration of estates of deceased persons.

This followed a debate immediately before the Darwin COAG as to whether the Federal Government should take over the administration of the hospitals system.

The time is coming where an overt (rather than a covert) decision should be made as to whether Australia is to be a federation or a unitary nation.