There has been a fair bit in the media recently about the reform of Federal-State relations with the election of the Labor Government. An example of this was the recent meeting of Treasurers and Health Ministers on 14 January that distributed amongst themselves $150 million worth of funding in a bid to cut back on waiting lists for elective surgery. If we are to believe the media hype which ensued after this meeting, we have entered a new era of Federal-State cooperation. However, this sort of hyperbole deserves to be scrutinised more closely and, in order to do so, it is important to understand a little bit about the legal framework which has led to this impasse in the first place.

The Australian Constitution – the primary document which sets out how Australia’s political and legal system is to work – is the source of the problem. As everyone is probably aware, prior to Federation in 1901, Australia was a loose alliance of states. At Federation, the various states were loath to give up any of their power, so we have a constitutional framework where the Commonwealth Government has only a number of very specific powers and the States have broader constitutional authority to legislate.

The last 100-plus years of Australia’s history have been marked by arguments between the Commonwealth Government and the State Governments about who has power to do what. The High Court has often been called in to determine this issue one way or the other. The most recent example of this was the highly publicised challenge by the States to the Commonwealth Government’s ability to legislate for a Federal industrial relations system (which the Commonwealth Government decisively won). Industrial relations are not the only example of this; education and health are some of the areas in which the Commonwealth and States have overlapping jurisdiction.

What is clear from examining Australia’s history is that territorial battles between the Commonwealth and States over who has authority to do what do not benefit anyone. This much is recognised in the most recent report released by Professor George Williams who was commissioned by the NSW Government to examine how to achieve a harmonised Federal IR system. In the preface to his report, Professor Williams states: “One thing that has become clear is that the best system of industrial law cannot be built upon disagreement and disputation between the Commonwealth and States.”

The so-called “wall-to-wall” Labor Governments in the Federal sphere and every single State and Territory present a unique opportunity for forging a closer relationship between the Commonwealth and States because it is less likely political considerations will influence outcomes. However, we should not become too uncritical of these sorts of claims. While the Health meeting was used by the Federal and State Labor Ministers to boast of a new era to come, we should keep a close eye on how they actually intend to nut this out in a legal sense. As they say, the devil is in the detail.

Manoj Dias-Abey is a lawyer practising in one of Australia’s largest workplace relations law firms.

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