Fiscal balance must prevail

What can be done?

Both reports support the premiers’ call for a constitutional convention. This should not be distracted by issues not directly related to federalism, for example, a republic or a bill of rights. It should be about the far more relevant issue: how to restore the federation.

Ideally, this convention could aim to propose constitutional amendments to:

• ensure "vertical fiscal balance", so that the states would be responsible for collecting most of their income and answering to their electors as to how they spend it;
• list those powers exclusively reserved to the states, or if shared, where state laws are to prevail. The absence of such a list allowed the High Court, under the camouflage of literalism, to launch and maintain its long adventure in forcing centralism on a reluctant nation;
• cap the extent of the appropriations, external affairs and corporations powers, all of which now seem virtually unlimited;
• ensure that minimum bureaucratic overlap occurs in relation to powers the exercise of which are effectively shared; and
• ensure the states are directly involved (and not just consulted) in determining the membership of the High Court. Why not, for example, allow each state chief justice or a nominee to join the bench as “ad hoc” justices in disputes between the states and the Commonwealth?

Apart from the high quality of the delegates, the success of the constitutional conventions after 1893 was at least in part because they were mainly elected. Only one half of the 1998 Constitutional Convention was elected and that was by a postal system too open to abuse. Many of the nominated members in 1998 were effectively ex officio members, including the prime minister, the opposition leader, the premiers, and leading ministers. For this Convention, there should be a small number of ex officio members with most elected under a secure voting system. We should have faith in the good sense of the Australian people.

A wholly or significantly nominated convention would lack authority and would be open to manipulation and bias. It would have as much authority as the endless succession of “summits” which are called to settle some issue and too often to diffuse some debate. If not elected, or unwilling to stand, prominent constitutional lawyers, political scientists and finance and business experts could be appointed as advisers.

The only way to ensure this convention has a chance of achieving a result is to follow the Corowa Plan. Proposed by Sir John Quick in 1893, this ensured that the movement to federation was not bogged down in endless disagreement between the six parliaments. To apply this to the 21st century convention on the federation, a similar procedure should be agreed in advance. This would mean that when the convention finalises its draft recommendations, these should be made public and sent to all the parliaments for comment.

The convention would hear and consider comments before making its final recommendations for constitutional change. These would then be included without further debate in a bill for a referendum. There should of course be time limits for each stage in the process, but the time between the opening of the convention and the date of the referendum should be no more than 18 months to two years.

Adopting the Corowa Plan principles would ensure that the conclusions of the convention are put to the people for their decision, and not just ignored or pigeonholed.

Conclusion

There is a clear need to restore the principles and essence of this our Federal Commonwealth which the Australian people approved and have regularly affirmed. Whether the states are to be restored, or are to be even more emasculated, that decision should only be made by the people in a referendum, and not by circumventing our Constitution, which remains a vision splendid.