Scrap the states? Would we have to scrap the constitution too?

Another new year brings another release of previously secret Cabinet documents by the National Archives.

In response to this year’s release of Cabinet Documents from 1984-5, Bob Hawke, then Prime Minister, has repeated his call for the scrapping of the States. He argues that one of his biggest regrets is his failure to implement national protection of Aboriginal land rights because of Western Australia’s opposition. Scrapping the States is a call that Hawke has made before – in his 1979 Boyer lectures he argued that the scrapping of the States would facilitate efficient and responsive government reform.

It’s a call that is not uncommon or unexpected from a federal Labor leader. Labor can be defined by its commitment to centralisation and harmonisation of standards and services (although increasingly we are seeing similar calls from the other side of politics).

It’s also a call that reflects current attitudes across Australia, according to the results of a nationwide Constitutional Values Survey undertaken by Professor A J Brown from Griffith University. In the 2012 survey, only 43.7 per cent of respondents thought it was better for decisions to be made at the lowest level of government competent to deal with the decision. This fell from 51.8 per cent in 2008. In 2012, 45 per cent who thought it was better for as many decisions as possible to be made at the higher levels of government whereas only 41.1 per cent thought this in 2008.

Expectations about quick reactions by ‘government’ to emergent issues – at the local, national and international levels – have also led to criticism of the current federal system. There have also been calls for the abolition of the States from business and industry who seek less bureaucratic duplication and greater harmonisation of laws and regulations in the name of efficiency and clarity.

Not everyone is convinced that federalism and the States need to be scrapped – maybe tweaked a bit to work better – but scrapping the States risks scrapping the many benefits of decentralised federal systems. (When I say ‘not everyone’, I include myself. More about my views can be read in my joint contribution in The Future of Australian Federalism: Comparative and Interdisciplinary Perspectives.) Federalism provides opportunities for competition between the States to drive policy innovation, for policy experimentation, for local diversity to be accommodated in policy choices and for more democratic participation by the community.

Putting aside the arguments for and against scrapping the States, it is worthwhile to pause and consider whether we can scrap the States under the Constitution, or whether, to scrap the States, we have to scrap the Constitution itself.

‘An indissoluble federal Commonwealth’

It may very well be that abolishing the States would not be possible under the Australian Constitution as it presently stands. Our Constitution is not a stand alone document. It is attached to an Act of the UK Parliament: the Commonwealth of Australia Constitution Act 1900. While we don’t have a preamble to our Constitution, there is a preamble to this Act, and it provides:

WHEREAS the people of New South Wales, Victoria, South Australia, Queensland, and Tasmania, humbly relying on the blessing of Almighty God, have agreed to unite in one indissoluble Federal Commonwealth under the Crown of the United Kingdom of Great Britain and Ireland, and under the Constitution hereby established:

The term ‘indissoluble’ was added at the very last constitutional drafting convention in 1898 - intended to avoid the experience of the United States civil war and introduce permanence and indestructibility to the Australian federation. (Professor Helen Irving has written a great piece on the drafting and history of the term which can be accessed here.)

Would it be possible to abolish the States in the Constitution? Or do the words ‘indissoluble federal Commonwealth’ in the preamble to the Commonwealth of Australia Constitution Act protect the continued existence and operation of the States in our Constitution, at least in some form?

If we really wanted to abolish the States, could we amend or abolish the preamble? This is much more difficult than it sounds. The Constitution can be amended through a process that includes a referendum (I come back to this below), but the preamble is not in the Constitution, but in the covering Act. John Quick and Robert Garran in their seminal work on the Constitution, The Annotated Constitution of the Australian Commonwealth (1901), considered why the principle of indissolubility was placed in the preamble in the first place:

The only reason which can be suggested, is that the Australian Parliament and people have a general power to amend the Constitution, and it may have been considered wise and prudent that, coupled with a right so great and important, there should be a reminder, placed in the fore-front of the deed of political partnership between the federating colonies, that the union, sealed by Imperial Parliamentary sanction, was intended by the contracting parties to be a lasting one, and that no alteration should be suggested or attempted inconsistent with the continuity of the Commonwealth...

How could the preamble be changed then? Australia has broken its legislative ties with the UK – that is, the UK can no longer legislate for the Commonwealth or the States (see section 1 of the Australia Act 1986). Generally speaking, the UK’s former powers have been grated to the Commonwealth and/or the States (see the Statute of Westminster Adoption Act 1942 and the Australia Act 1986). However, in both of these statutes there is a section that expressly denies the power to the Commonwealth and the States to repeal, amend or enact legislation inconsistent with the Commonwealth of Australia Constitution Act 1900.

There is one possible way to amend the Commonwealth of Australia Constitution Act 1900 – section 51(xxxiii) of the Commonwealth Constitution grants the Commonwealth Parliament the power to make laws with respect to:

the exercise within the Commonwealth, at the request or with the concurrence of the Parliaments of all the States directly concerned, of any power which can at the establishment of this Constitution be exercised only by the Parliament of the United Kingdom ...

Given that in 1900, the UK Parliament would have had the power to amend the preamble, this may provide a way for the Commonwealth Parliament to do so today– but only with the request or with the concurrence of the Parliaments of all the States.

Scrapping the States in the Constitution

Amending the Constitution to scrap the States would require dramatic changes to the whole document – basically, a gutting of the Constitution. Quick and Garran observed that ‘the Federal idea ... pervades and largely dominates the structure of the newly-created community, its parliamentary, executive and judiciary departments.’ To read through the Constitution is to be constantly reminded of the federal nature of the compact. You see it in:

·         the provisions establishing the Commonwealth Parliament – the composition of the Senate;

·         the many provisions that give effect to the division of legislative and economic powers between the Commonwealth and State Parliaments;

·         the provisions establishing the federal judicial structure;

·         the provisions that save the States, their laws, Parliaments and constitutions;

·         the provisions that ensure the smooth operating of the mechanics of the federation – for example, dealing with inconsistent laws and preventing discrimination based on place of residence;

·         the provisions that provide for the creation of new States; and

·         the referendum provision that requires the consent of not only a majority of voters across Australia, but a majority of people in a majority of the States.

Drafting the amending Bill to scrap the States would be quite a task in itself. In short, scrapping the States requires scrapping the pervading idea of the Constitution.

What would we replace it with? Important decisions would have to be made regarding how the new national Parliament would be structured in the absence of a division of powers between the Commonwealth and the States. If we remove the federal feature of the Constitution would we need or want to replace it with anything, and if so, what? A system of regional councils? Different models for representation in the federal Parliament? And that’s just the creation of the draft amendment Bill – it then has to get passed!

Amendment under our Constitution is no small feat – only 8 of the 44 attempted constitutional changes have been successful in the past. Generally those changes that have sought to increase federal government’s power have been unsuccessful – it would seem that the Australian voters are wary of power grabs by the central government.

Under the referendum provision (section 128 of the Constitution), all of the changes – the repeals and amendments – would need to be passed by an absolute majority in both houses of the Commonwealth Parliament (or in rare cases, through one house twice) and then put to the electors in a referendum. Generally speaking, to pass at a referendum, a Bill requires the support of a majority of voters across Australia, as well as a majority in a majority of States – so a majority in 4 of the 6 States. However, there would be an additional hurdle for a referendum abolishing the States because at the end of the section there is a part that says no alteration ‘in any manner affecting the provisions of the Constitution in relation [to the States], shall become law unless the majority of the electors voting in that State approve the proposed law.’ It is hard to imagine an amendment that affects the States more than their abolition – and thus it would be required to be passed by a majority in all of the States.

What then for the federation?

So the long and short of it is that scrapping the States is not as simple as it may sound – a good sound bite for New Year’s Day perhaps, but a significant constitutional challenge. It is a reform that at the least would have to be supported by the Commonwealth Parliament, a majority of voters across Australia, and a majority of voters in all of the States. There is also a strong argument that it would require the consent of the State governments to change the preamble to the Commonwealth of Australia Constitution Act 1900. State governments agreeing to abolish themselves? It all sounds a little surreal. (It should be noted that former Queensland Premier Peter Beattie has come out in support of Hawke’s idea to abolish the States. One is left wondering whether Beattie would have had the same view when he was Premier.)

What then for the federation? Should we remain satisfied with what we have? Rather than getting bogged down in a conversation about abolishing the States, a more productive conversation is to consider the significant reforms that could be effected with no, or very little, constitutional change. The Commonwealth could give the States greater tax room and pave the way for the decrease in the significant vertical fiscal imbalance that has meant the Commonwealth can dictate much of the States policies in areas such as health and education though its fiscal powers. The distribution of powers between the Commonwealth and States could be rethought – where is it appropriate for national laws to set universal standards and where is it appropriate for States to be responsive to local needs and tailor policies and laws to local concerns? A more transparent and open framework could be created for the co-operative federal processes, such as the Council of Australian Governments, to help in their effectiveness and our confidence in inter-governmental cooperation.

Federalism reform – under the moniker of ‘cooperative federalism’ – was one of the defining platforms of the Rudd Government when it swept into power in 2007 – although during his term there was only small progress with some reform achieved through the Intergovernmental Agreement on Federal Financial Relations in 2009. Since Gillard has taken over the leadership, it has largely dropped off the political agenda.

Given that there are many reforms we could implement with no, or little, constitutional amendment, it seems that a conversation about scrapping the States is all a bit premature. Let’s talk instead about making our federation work for us.