Post WorkChoices: beyond the battle for states rights

In the just decided WorkChoices High Court case, which upheld using the corporations power of the Australian Constitution to make industrial relations law, Mr Justice Callinan said the case has consequences for both the existence and powers of the states.

And so it has.

The gist of the decision is that you should look at the constitution as a text, and construe the words “with all the generality which the words used admit”.

It was therefore wrong to attempt to interpret the document in a way that worries about the effect a particular construction may have on the states.

They said the foundation of the Commonwealth of Australia involved much more than the establishment of a type of municipal union resembling the union of parishes for the administration of the poor laws, say in the Isle of Wight. It involved a federation of national character exercising the most ample power.

The majority found the corporations power extended to the regulation of the activities, functions, relationships and the business of a corporation, and so therefore extends to the means by which they are to conduct their industrial relations.

Arguments that the corporations power should be read down because: (a) the people had previously considered and rejected relevant changes to the constitution expanding Commonwealth power in referendums; and (b) there was another clause in the constitution dealing expressly with what legislative power the Australian Government has with respect to industrial relations, that should govern what the Commonwealth can and cannot do - were rejected.

This wide reading gives the Australian Government the power to regulate anything that a corporation can do.

Similar wide constructions of constitutional power have been with respect to other areas of the constitution.

For example, during 2006 the High Court found that the external affairs power - the power considered in the controversial Tasmanian Dams case of the 1980s - can be read so the Australian Government can legislate where there are “matters of international concern”: a very wide reading indeed.

These cases establish comprehensively the width of Commonwealth legislative power. Combined with its financial powers, there is now no doubt about the dominant position of the Australian Government within the federation.

Two founders of federation, John Quick and Sir Robert Garran observed in The Annotated Constitution of the Australian Commonwealth, Australia’s first constitutional text, that in the early history of the Commonwealth the states will not seriously feel the deprivation of legislative power intended by the Constitution, but as Federal legislation becomes more active and extensive the powers contemplated by the Constitution will be gradually withdrawn from the state parliaments and be absorbed by the federal parliament.

The accuracy of this observation is now on bright display.

It appears that, constitutionally speaking, the Australian federation is at tipping point. No longer can anyone claim there is something called "states' rights".

The idea of a federal structure is to ensure that power is diffused among different tiers of government, so as to protect individual liberty from a strong state.

However, except in the most extraordinary circumstances one can no longer expect to be able to run a successful constitutional case so as to preserve the power of the states vis-à-vis the Commonwealth.

In any regard, leaving aside the growth of Commonwealth power in areas such as the environment (largely gained from the foreign affairs power), the states have been quietly transferring powers to the centre in a number of areas ranging from mutual recognition of trade qualifications to fighting terrorism to even investigating train accidents.

There is a strong argument to say that the reality of globalisation - from the ease of international travel, to global markets, through to the Internet and YouTube is now the greatest protection against tyranny.

Rather than worrying about the death of states' rights, it is now the time to expedite the work being done through the Council of Australian Government process and make the Commonwealth responsible for matters such as occupational health and safety and workers' compensation, so there is one clear entity, clearly responsible to the electorate for the regulation of business.

Where necessary, the states should transfer the powers to the Commonwealth to allow this, as they did to remove doubt about the Commonwealth’s capacity to legislate for the formation of corporations. This would not only aid international competitiveness, but cut red tape.

Various Commonwealth mnisters have floated Commonwealth takeover of schools and hospitals.

A constitutional convention, called for by parties from state premiers to the Business Council of Australia could be held, to determine the role of states judged against the subsidiarity principle of the European Union, which holds that decisions are taken as closely as possible to the citizen, with central government not acting unless it is more effective than action taken at lower levels.

This would necessarily involve considering the role of local government within the Australian federation.

Rather than mourning states' rights, these steps would be a better way of ensuring a modern and relevant federation post the WorkChoices decision.