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Ten advantages of a federal constitution

By Geoffrey Walker - posted Tuesday, 15 May 2001


Centralists always suggest replacing the six states with ‘regions’, between 20 and 37 in number. That structure would require the appointment of regional governors, prefects, sub-prefects, together with support staff. France’s regions are administered by an elite corps préfectoral, a highly-paid class who live like diplomats in their own country, with official residences, servants and entertainment budgets. Sooner or later, as in France, our national government would be forced by public dissatisfaction to create elected regional assemblies, between 20 and 37 in number. By then any savings would long since have evaporated.

As matters stand, the 32.7% of GDP that Australia allocates to general government expenditure is lower than unitary New Zealand’s 39.6%, the United Kingdom’s 40.1 and (before devolution) France’s 52.4%. Australia’s figure is closer to the United States’ 30.5%. Six sets of state parliamentarians thus seems quite an efficient arrangement. A variant of the vertical duplication argument is that Australia’s population is just too small to support six state governments. Some comparisons may be helpful here. In 1788 the population of the 13 American states was 3 million, significantly less than Australia’s population in 1901. By 1832 it had risen to 15 million but probably did not match Australia’s current population of 19 million until about 1845. Switzerland, that land of supreme efficiency, has 5.5 million people for its 26 cantons. It is a more decentralised federation than Australia, with even some defence functions being performed by the cantons.

10. A competitive edge for the nation

Often overlooked even by advocates of federalism is the value of competition among the states as a means of enhancing the international competitiveness of the nation as a whole. In other contexts, this is quite a familiar principle. It is, for example, the basis on which international sporting teams are selected. Out of the deliberately encouraged rivalry between local, regional and state teams emerges the squad that will represent Australia in the Olympics or other international events. Competitive federalism harnesses this principle to the goal of earning a better standard of living for all.

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The truth about railway gauges.

No discussion of governmental competition and efficiency in the Australian federation can overlook the old reproach that Australia’s mixture of railway gauges is a consequence of the federal system. But the rail networks were established long before federation. Further, Britain had more gauges than Australia, but all were standardised by the 1880s. Our federal structure does not explain why, over a century later, most of Australia’s non-standard track remains unconverted. The answer, as Gary Sturgess has suggested, probably lies in the fact that until the reforms of the last decade Australian’s railways were from the outset almost all government-owned.

Towards more effective federalism

At the dawn of the Commonwealth’s second century, changes are in progress that may help revitalise Australian federalism.

The goods and services tax in practice provides the secure revenue basis the states have long needed and is a step towards more balanced federal-state fiscal relations. The lack of a formal national bill of rights denies the federal judiciary the de facto veto power over state legislation that they enjoy in the United States and Canada.

Despite this, many of the world’s other federations tap the benefits of federalism better than Australia does. There are, however, a number of simple and inexpensive steps that would improve Australia’s performance. They include reviving the Senate’s role as the states’ house by establishing a standing committee on federal-state relations, formalising present inter-governmental bodies by requiring regular meetings and public hearings, and by recognising that the usual drive towards national conformism should be balanced by an appreciation of the benefits of diversity. The High Court should be invited to emulate the United States Supreme Court and revisit some of the centralist decisions that have undermined the Constitution. Some purely symbolic measures, such as the award of honours at the state level, would also help re-awaken the spirit of independence, self-reliance and community solidarity.

Conclusion

An awareness of the positive benefits of federalism will make the constitutional debate a more equal and fruitful one. This will mean recognising that in a properly working federation government is more adaptable to the preferences of the people, more open to experiment and its rational evaluation, more resistant to shock and misadventure, more politically efficient and more stable. Its decentralised, participatory structure is a buttress of liberty, a counterweight to elitism, and a seedbed of ‘social capital’.

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It fosters the traditionally Australian, but currently atrophying, qualities of responsibility and self-reliance. Through greater ease of monitoring and the action of competition, it makes government less of a burden on the people. It is desirable in a small country and indispensable in a large one.

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This is an extract from Geoffrey de Q Walker's policy monograph Ten Advantages of a Federal Constitution: And How to Make the Most of Them, which appeared in the Summer 2000-2001 issue of Policy, available from The Centre for Independent Studies.



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About the Author

Professor Geoffrey de Q Walker is Emeritus Professor of Law at the University of Queensland.

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