Senator Alan Eggleston


I wish to speak in support of the no case for the referendum for recognition of local government in the Australian Constitution. Senator Milne has just talked about a rump in the Liberal Party which opposes the constitutional recognition of local government. Last year at the federal council of the Liberal Party in Melbourne a motion was passed almost unanimously opposing the constitutional recognition of local government. That involved most state divisions of the Liberal Party; it was far from a rump of the Liberal Party opposing the constitutional recognition of local government.

I am against the constitutional recognition of local government because I believe such an amendment is unnecessary as Commonwealth government funding can be provided to the states for any purposes including under section 96 of the Constitution. This referendum, while portrayed as involving a simple amendment to the Constitution, could seriously undermine our federalist system. It is claimed that a 12-word addition to section 96 of the Constitution is required to preserve, for example, Roads to Recovery. I do not think they are necessary, but the additional words proposed are 'to any local government body formed by a law of a state.'

These 12 words may seem simple but the implications of their incorporation in the federal Constitution are not. In fact, the incorporation of these words could completely alter our federalist system of government, which has served Australia well since 1901, by leading to a complete change in the relationship between the central government—the Commonwealth—and the state governments, with an increase in the role of local governments in governance at the expense of the state governments. While some people may think this is a good idea, I point out that Australia is a vast country with widely differing regions and small communities whose needs are much more completely understood by their state government than by a government in distant Canberra.

The concept of federalism was, and I understand still is, that the Commonwealth has certain designated powers while the state governments, which are effectively regional governments, look after all the other matters such as health, regional development and education. With the states ceding the taxing power to the Commonwealth as an emergency measure during World War II, and the Commonwealth since then retaining that role, the financial relationship between the states and the Commonwealth has changed since Federation so that some Commonwealth funding is provided through the states to local government for many of the services which affect our lives.

It is important to remember that local government was deliberately left out of the Constitution by our founding fathers because local government was regarded as an administrative extension of state governments not having a relationship with the Commonwealth, and so it remains today, in effect. Also, let us remember that it was the states which formed the Federation and that the states, as the governments of the differing regions of Australia, remain the cornerstone of our system of government.

Why, one must ask, is this question being put again when it has been defeated three times already under ALP governments? Firstly, in 1944 under Curtin; again, specifically on local government, under Whitlam in 1974; and more recently, under the Hawke government. What is behind this, one might well ask? It has been ALP policy since the 1920s to effectively replace the state governments with a series of regional councils directly funded from Canberra, even though it is patently obvious that the existing state governments are best placed to have the resources to service their regions. In January this year, former Prime Minister Bob Hawke called for the abolition of the states, so demonstrating that the ALP policy on the abolition of the states has not changed since 1920.

This 2013 referendum proposal is based on the view that the so-called Pape case raises doubt about the Commonwealth's ability to provide funding to local government. However, the Hon. Michael Mischin, Attorney General of Western Australia, has written that, in his view, the Pape case does not preclude the Commonwealth from providing direct funding to local governments for two reasons. Firstly, the Commonwealth can directly appropriate money for local government 'where the expenditure is for purposes within existing Commonwealth powers, which have been expansively interpreted by the High Court'. Secondly, Attorney General Mischin states:
Pape does not limit other avenues of funding such as section 96 grants of financial assistance.

He further states that 'the Commonwealth's ability to fund local government by this mechanism is effectively unlimited'. Attorney General Mischin goes on to state that 'the Pape decision, especially in constitutional law matters, is open to varying and different interpretations' and this highlights the potential problem of adding what ALGA describes as '12 simple words to the Constitution'—namely, that the High Court may find unexpected references, intentions and meanings in additional words added to the Constitution which may take years of litigation to clarify and the outcome of course may not be what was expected.

In my opinion, it is extremely naive to think that the addition of any words to the Constitution is a simple matter. A great example of this has been the High Court's interpretations of the external affairs powers of the Constitution, which has enabled the Commonwealth to greatly expand its jurisdiction within Australian society.

I repeat that, according to the WA Attorney General, no doubt on the advice of the crown law department, there is no impediment under section 96 to the Commonwealth providing funds to the states for local government purposes. So if there is no restriction to the provision of funds by the Commonwealth to the states, what is the point of a third referendum from the ALP to write local government into the Constitution unless it is to progress the long-term ALP policy of sidelining the states?

Attorney General Mischin's views on this are supported by a number of eminent constitutional lawyers, including Professor Greg Craven, who has argued:
It will be sold as a modest change that will boost funding for local governments, but it's really about expanding commonwealth power.
It's like a scorpion, small but lethal.

Professor Anne Twomey has argued:
The sting is in the tail—the 'terms and conditions'. This means that the Commonwealth can intervene in any area of state responsibility, such as health or education, by placing conditions on its funding to the state.
Further, Professor Cheryl Saunders has argued:

We should think again on the terms of 'recognition' of local government by constitutional referendum in September … This is not a good idea. It is correct, as several premiers have argued, that it undermines the authority of the states in areas of state responsibility. The muddle that is Commonwealth-state relations, which urgently needs sorting, should not be further complicated by a measure of this kind.

There are a few other points which need to be referred to and which already have been to some extent in this debate. Firstly, referendum information will not be posted to the registered addresses of an elector but will go as 'to the householder' mail, where in my opinion it is likely to be thrown out unread. One must ask, if that is the case, could it be that the proponents of the legislation do not acknowledge that electors have a right to be informed before voting and they simply hope that people will go along and donkey-vote, and perhaps enough will vote yes for this to get through? I think it is a very real and severe criticism of the government that they are not proposing to post the material to the electors' official addresses.

Some question whether equal funding will be provided to the yes and no cases. Again, I think that if there is not equal funding, as it appears there will not be, that is a very a severe criticism of the government and clearly shows their bias for the yes case, in that the yes case funding will run into millions of dollars whereas I believe there is barely half a million dollars for official material for the no case.

In conclusion, it is my view as a committed federalist that the states remain the best-equipped entities to look after the diverse interests of the many and diverse regions of Australia precisely because they are the regional governments across this huge continent of ours, not bureaucrats based in Canberra. Accordingly, I hope this referendum will be defeated. I think the old aphorism 'if it ain't broke, don't fix it' very much applies to this case.

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