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Government corruption and the local government referendum

By David Galloway - posted Tuesday, 11 June 2013

Australians love to knock back a referendum. But if you're looking for a good reason to vote "no" in the September 14 referendum, you might want to consider this.

We're being asked to approve a change to section 96 of the Constitution, so the Commonwealth can provide direct financial assistance to local government authorities.

That sounds harmless enough, until you sit the amendment next to the Financial Management and Accountability Act 1997and realise that, together, they create the perfectpork barrel.


To understand why, it's helpful to know a little about the High Court's judgement in Williams v The Commonwealth

This judgement gave us a refresher in good governance by pointing out what every parliamentarian should know. There are three arms of government, and democracy depends on each doing its job properly.

The Executive (in practice the PM, Ministers and senior bureaucrats) manages the business of government. Parliament makes laws and stops the Executive becoming too authoritarian, while Courts interpret and apply laws.

As part of this separation of powers, the High Court ruled that the constitution prevents the Executive from spending public money on whatever it likes. Instead, spending must be authorised by a constitutional head of power and approved by Parliament through law.

The Court had to think about this because Williams objected to the Howard, Rudd and Gillard governments paying taxpayer's money to Scripture Union Queensland. And it turned out there was no law approving the payments, making them unlawful.

As a journalist might put it; Howard, Rudd and Gillard had been caught illegally funnelling money to religious fundamentalists.


On closer examination, it emerged that successive Executives had been spending quite a lot of our money improperly for a very long time. What's more, the Coalition and Labor were equally culpable.

This was a big problem, and fixing it would be difficult. So the Executive decided to do the irresponsible thing, it asked Parliament to pass the Financial Framework Legislation Amendment Bill (No3) (The final Act can be found here) .

In a truly Orwellian twist, this amended the Financial Management and Accountability Act to ensure the Executive was not accountable for its financial management by giving it authority to:

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About the Author

David Galloway is a lawyer working in the corporate sector. He does pro bono work for a community legal service in Melbourne and has a strong interest in public interest law.

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