5.6.13 Constitution Alteration (Local Government) 2013

Mr HAWKE (Mitchell) (13:22): I
rise to speak on the Constitution Alteration (Local Government) 2013. It is
quite frightening to listen to some of the Labor Party's backbenchers, including
the member for Throsby, and their lack of sufficient understanding about our
Constitution and why it is structured the way it is—and, indeed, the role of
local government in that Constitution.

It is not accurate to say, as he said, that in New South Wales
there is a financial problem with councils, and therefore the Commonwealth has
to step in and fund them. It is accurate to say that the viability of very small
councils is what is at stake, and the purpose of that report was to provide for
mergers and acquisitions of two small councils, two small political units, and
the mismanagement of those finances. The member for Throsby bells the cat when
he says: 'It's just money. It's just finances. What's everybody worried about?'
That is the attitude of a government that is heading towards $300 billion of
debt, where money does not matter, because money always matters and who controls
the money controls the power. It has always been thus. Changes to our
Constitution that affect financial arrangements between our Commonwealth and
state systems very much affect the power balance between the Commonwealth and
state governments, and to imply differently is to either be disingenuous or hide
a broader agenda.

I oppose this change to our Constitution because I believe it
is another attempt to change the political conversation that this government has
put forward, to mask from the Australian people what is really going on. I note
the dissenting report from coalition members and senators, which particularly
noted that the preconditions for success of this referendum, highlighted by the
expert panel and other stakeholders such as the Australian Local Government
Association, have not yet been met. I also record that this is the third time
this referendum will be put to the Australian people. The governments that have
put it before are: the Whitlam government in 1974, which saw a 53 per cent 'no'
vote in all states except New South Wales; and the Hawke government in 1988,
when 66 per cent said no and every state voted against it.

Bad governments that are nearing an election should not distort
our politics by trying to change our Constitution in this shameless way. I agree
with Peter Reith, who says that the yes case will saturate the airways in the
week before September 14, and the no case will be silent for lack of funds. The
process is the ultimate constitutional fix and besmirches Australia's record of
clean elections—more on that later. This is certainly a referendum that the
government has set up to fail, and that the Prime Minister has set up to fail.
Indeed, constitutional lawyer and vice-chancellor Professor Greg Craven
said:

This will be a rushed referendum on words
drafted in haste for political purposes.

I also turn today to the real essence of
why I oppose this referendum. It goes to the heart of why I am a Liberal, and an
argument we hear too little about in debates on modern governance—that is,
correct political structure and how political structure is vital to providing
the checks and balances inherent in protecting rights and liberties limiting the
power of government. Any change to our Constitution should be made rarely enough
to allow careful consideration and due thought. This is the inherent view of the
Australian people, who have rejected the vast bulk of referendum proposals. An
inherent scepticism of government politicians and requests for additional power
is an essential precondition of a free society. It is a great virtue that
Australian people have this understanding inherent in them, and it is something
that I commend.

I point to Isabel Paterson and her treatise on structure in
government, The God of the Machine. She
wrote about the importance of a society being correctly structured to balance
power between levels. The balance was important, and must function correctly for
the intended impact—in this case, the limitation of power—to function correctly.
Simply put, in an Australian context what that means is that the balance between
the state and the Commonwealth—that is, our federal compact—must be maintained.
The reason I oppose this constitutional change is that it will alter the balance
between the state and the Commonwealth. The balance will shift, again, towards
the centre, this time through a level of government that can directly deliver
services, duplicating that already available in our states in so many ways. That
is why several premiers have argued against this referendum. It shows the threat
that this constitutional change represents to state reform. Barry O'Farrell said
directly:

We do not support local government getting
a financial power in the federal constitution because that can fundamentally
change the relationship that local government has …

Local government across Australia is set
up by state parliaments, this financial recognition essentially changes the
relationship, gives it a more direct relationship with the federal
government.

He is correct about that. Cheryl
Saunders AO, a constitutional lawyer, said:

Even more importantly, this proposal would
increase not only Commonwealth power but executive power, exacerbating what
already is too prevalent a tendency for the Commonwealth to regulate through the
expenditure of public moneys, using executive schemes.

This goes to the heart of why we need
this proposal now to change our Constitution. We had a national government, and
our national government was formed for particular reasons—particularly the
defence of our nation. Given that Defence expenditure—the reason for us having
national government—as a percentage of GDP is at its lowest level since 1938, I
find it disingenuous for members of the Labor Party and the government to say we
should be fixing potholes in local roads when we are starving our nation's
Defence forces of funds. I find it furthermore wrong that our diplomats overseas
are starved of the funds they need to do their vital jobs at the moment, and
that posts are closing. They do not have the funds they need to adequately
provide for Australia's interests in trade. Free trade agreements are not being
conducted. Billions of dollars are being wasted in debt and deficit. And yet the
priority of this parliament is to expand the ability of the Commonwealth to
spend money on local roads and local issues—is that seriously the priority of
this national government? Is now really the time to say: 'Let's loosen the purse
strings of the Commonwealth. Let's let them spend money more easily. Let's let
them spend it in more ways'? The pink batts scheme would indicate we need more
limitations on the expenditure of Commonwealth funds. The disasters this
government has mismanaged would indicate we need more limitations, not more
openings for the Commonwealth to spend more money.

This argument by members, which is essentially 'Let's get our
federal government into matters that are not its domain', is hardly compelling
to me. It is, essentially: 'Let's fix the state government's potholes. Let's fix
the local government council's potholes. Let's not focus our national government
on its real purposes—defence, administration of the federal law, diplomacy,
trade—all of the things our federal government has done.' I accept that it might
be a naive statement of many members here when they say they have no intention
to wipe out the state powers of so many MPs in this place, but the intention
here is not the same as the effect. MPs in this place saying that it will not do
something bad to our political structure is not a sufficient protection. Changes
to the Constitution which act to limit power in Australia must, of necessity, be
checked for impact against that imperative.

I would like to point out that local government is a creature
of the state subject to state laws and governed by state ministers and state
acts, and I believe it should remain so. There has been no case made by members
today about why that should change. Why shouldn't local governments be the
purview of state governments? Why shouldn't they be funded by state governments?
What is the problem that exists such that the Constitution needs to be altered
today? In fact, all of the projects that member after member have listed have
occurred. The money has reached them. The Commonwealth has funded them. The
objectives have been met already. There has been no articulate, cogent case made
about why the Commonwealth needs to more easily send money to this layer of
government.

Certainly I also believe that, as Professor Anne Twomey
stated:

Funding would also most likely become tied
to conditions that impose uniform Commonwealth policies on local government
bodies, reducing their autonomy and their capacity to serve the particular
interests of their own communities.

We have local government because it is
local, because it responds to local voters in local electorates. To then tie
these local government decision-making bodies to a Commonwealth grant which, as
we heard from the changes that are proposed, will be subject to the decision of
the executive on what, how and why they can spend money will remove that direct
distinction of local government and why we have local government in the first
place.

It is certainly the case that I agree with the view of our
nation's second-longest-serving Prime Minister, the former Prime Minister John
Howard, who said 'even a casual reference to local government in the
Constitution would end up having legal implications far beyond what might be
advocated by the proponents of such a change.' 'The Constitution is, of course,

the founding document of our nation. It is unacceptable that politicians can
abuse public money to change the Constitution that limits their power'—that was
Julian Leeser.

We have seen what has happened in this debate. We heard from
the member for Greenway. I do not believe that the member for Greenway, in
chairing her government panel, has convinced states, convinced stakeholders or
made a public case for change to our Constitution. Instead, the member for
Greenway listed the items of pork-barrelling that she thought were good in her
electorate. But, if Australians had any doubt about what this is about, they
should listen carefully to the contributions of members here. What is this
really about? She did not list one project in her electorate that has gone
unfunded because of the current arrangements. She did not cite where a local
government would have done something if it had access to this constitutional
provision.

It is of course ridiculous for many members to go forward and
say, 'If you learnt to swim, it was in your local pool and funded by a local
government authority.' Surely our debate about constitutional change has not
reached such a low juncture that we are debating local swimming pools. This is
about the structure of the Commonwealth and states and balancing and limiting
power, providing for the checks and balances that our nation needs to ensure we
have limited government in Australia.

I am also very concerned about the public funding of this
campaign. Currently, $21.6 million of public money for the 'yes' case has been
allocated and zero has been allocated for the 'no' case. That is very
concerning. Even before the campaign the 'yes' argument has been allocated three
times the public funding of the 1999 referendum. If we are talking about
spending public money, it does not seem this government has any problems
already. No constitutional change is needed.

It is certainly the case that, even with the High Court cases
in relation to Pape and Williams, the federal government has now conceded that
these cases do not justify a referendum. The case was not even referenced in the
Attorney-General's second reading speech of the Constitution Alteration (Local
Government) bill. If you do not even reference the case and do not need to make
a case about it then why again are we pursuing this constitutional change? The
Attorney-General cannot come forward and reference why we are doing it.

It is certainly the case that, when you look at this proposal
before us, we have perhaps the worst government in Australian history. This is a
government that spends money like it is going out of fashion. We have government
members who in this debate have said, 'Why would money provide power?' I have to
say to those members of parliament that this is not just about the money but it
is 'just about the money' because who controls the purse strings makes a big
difference to the power of government. It is a ludicrous argument for the
members of the Labor Party to suggest that money does not mean power.
Governments function through expenditure. One of the prime functions of a
government is to deliver a budget which outlines its expenditure and incomings.
And yet we have members of the Labor Party saying: 'Hey, don't worry about this.
This is just about a few bucks—just so we can send some bucks down to the local
government to spend.'

We have a constitutional structure. We have a federation, and
that federation has been critical to the success of our nation because it does
balance the roles of government. It balances the role of states, it balances the
role of the Commonwealth and it allocates to them different purposes and
functions which, if they got on with and fulfilled themselves instead of trying
to shift, would produce a better compact in this country.

Look at what will happen if this referendum does not get up.
What would be the consequence if this referendum failed, if what I am saying
comes to fruition—that a 'no' case wins the popular vote and the vote in the
states? There is no consequence. The federal government would still be able to
fund local government. The condition, of course, would be that the money is paid
by state governments as currently allowed by the Constitution and as has
happened since the 1920s. Nobody can point to any other consequence that may
happen, so why again are we changing the Constitution?

I think we should listen to the voices of so many experts in
this field. I think we should listen to the voices of former federal minister
Peter Reith, a Liberal minister, and former federal minister Gary Johns, an ALP
Special Minister of State. Too often today there is a push in our nation to
centralise power in Canberra. Too often there is a lack of understanding in this
place of why a balance of power between states and the Commonwealth matters to
the success of our society. But political structure matters. It matters in
Australia as our federation hinges on a correct balance of power vested in
states against the centre, the Commonwealth. Voting 'no' to this referendum will
ensure that we retain that balance, we retain the best elements of federation
and that competitive federalism continues to deliver great benefits. Local
government can keep on doing the work it is doing beholden to the people it
should be beholden to: its own local ratepayers.