Former prime minister Bob Hawke’s recent call for the state governments to be abolished is worthy of support.
Labor has historically been in favour of centralisation, while the Coalition has supported federalism. So, Hawke’s position is not surprising. But leaving aside party politics, there are good reasons why Australia should consider this change to its Constitution.
The reason Australia has a federal Constitution is a negative one. It was due to fear from the colonies of domination by each other or by the new national government.
Taken at its best, the adoption of federalism in preference to a unitary system was the necessary price of creating Australia as a nation. At its worst, it was a base compromise pandering to colonial jealousies, which now saddles Australia with an unnecessarily complex and expensive form of government.
Unlike in countries such as Nigeria, where federalism serves the purpose of providing for ethnic autonomy, Australian federalism solves no problem and confers no benefit.
The supposed major benefit of federalism is that it provides protection against tyranny by diffusing power. But federalism does not affect what governments can do to individuals, only which government may do them. Distributions of power are not as effective a protection of liberty as are restraints on power.
Federalism cannot provide an effective limit to what the state and Commonwealth parliaments can in combination do to the individual. Only a Bill of Rights can do that.
So, Australia is left with nine governments and 15 legislative chambers for a population of 24 million.
The costs of this are staggering. In 2002, the annual costs of federalism to the economy was estimated at A$40 billion – a figure that would be much higher today.
This covers costs such as running state and territory governments, costs to the Commonwealth of interacting with the states, and compliance costs to business. But it excludes intangible costs in the form of time and inconvenience: think of simple matters such as car registration or entry into a new school system experienced by anyone who has moved interstate.
There is ample evidence that Australians, notoriously resistant to constitutional change, would support abolishing the states.
A 2014 survey by the Griffith Federalism Project found 71% of respondents favoured changing the current system. Among this majority, there were preferences for different allocations of power between national, regional and local governments.
The idea of replacing the states with regions defined along rational economic lines was an interesting feature of these results. But even more significant were the results of a 2014 survey commissioned by lobby group Beyond Federation, in which 78% of respondents supported the idea of Australia having a single set of laws for the country. So, it seems that constitutional reform to abolish the states would be well received by voters.
Making such a change would mean that, as in New Zealand and the UK, Australia would have a single (national) parliament with comprehensive lawmaking power. That parliament could delegate lawmaking authority to regions and/or local governments, in the same way as state parliaments currently delegate power to local authorities.
However, there would be no more disputes over which lawmaking power the national parliament had, and no doubt that national law overrode regional and local law. The legal system would be much simpler, and compliance costs to business and individuals radically reduced.
Australia would also have one department of education, one department of agriculture, one department of the environment and so on, instead of multiple agencies currently.
Disputes over shares of Commonwealth revenue allocated to the states is a constant feature of federal-state relations. All that would be a thing of the past. Expenditure could be determined according to the needs of people, irrespective of where they lived and without reference to artificial state boundaries.
The current focus on “reforming” the federation avoids the real issue: why have federalism at all? If we were writing a constitution from new, would we really recreate the current nine-government system? If the answer to that is “no”, there is a good reason to change it.
Prime Minister Malcolm Turnbull said Ley judged resignation to be the appropriate course of action in the interests of the government. But Ley has maintained her claims were within the rules.
In response to the scandal, Turnbull has announced major reforms to the parliamentary entitlements system. The changes are modelled on the UK’s system of vetting MPs’ expenses.
The main reform Turnbull announced is the introduction of an independent agency, modelled on the UK’s Independent Parliamentary Standards Authority, for parliamentary entitlements. The Department of Finance administers Australia’s current system.
The independent authority will be staffed by a member experienced in auditing, a member experienced in remuneration matters, the president of the Remuneration Tribunal, a former judge and a former MP. This is a very strong board. It will have significant independence from the government.
MPs and senators will be able to get advice and rulings from the independent agency if they are unsure about a claim.
This means the administration of MPs’ entitlements will now be out of the hands of MPs themselves, who may be interested in a generous interpretation of claimable expenses. MPs’ expenses will now be overseen in a more robust and independent way.
The second reform is to have monthly disclosure of parliamentary expenses, rather than every six months. More frequent reporting will certainly improve the system’s transparency.
The government has also committed to implementing the recommendations of the independent review of parliamentary entitlements that followed then-Speaker Bronwyn Bishop’s 2015 “Choppergate” scandal.
As such, entitlement claims will be limited to those made for the dominant purpose of conducting parliamentary business. This excludes political party administration and management, and activities for the dominant purpose of party fundraising, pursuing commercial interests or obtaining personal benefit.
The legal enforcement of the system will be increased. Where MPs misuse entitlements, legislation will oblige them to repay the money – plus a 25% penalty.
The terminology of “entitlements” will be changed to “work expenses”. This is because MPs are given resources to perform their duties in exchange for acting in the public interest.
In 2009, the UK had its own MP expenses scandal. UK MPs made inappropriate claims for a second residence allowance, alongside outrageous claims for moat cleaning, a ride-on lawn mower, jellied eels and a duck house.
The scandal led to the first resignation of a Speaker in the House of Commons for more than 300 years, and prompted the resignation of a dozen government ministers.
Following public outrage, legislation was introduced to set up the Independent Parliamentary Standards Authority. It was a strong reaction to a
situation that the then-British prime minister, Gordon Brown, called the “biggest parliamentary scandal for two centuries”.
The Independent Parliamentary Standards Authority determines what MPs can claim, and administers and audits those claims. It is independent of government and has significant resources.
Turnbull’s reforms will significantly revamp the entitlements system. They introduce for the first time an independent agency to vet MP expenses. If the agency does its job well, it will ensure MPs do not abuse the system.
The reforms will also simplify the system, enhance transparency, tighten the rules, and introduce enforceable penalties.
When the system comes into effect, Australians will hopefully see fewer politicians flying around in helicopters and private jets while attending to their private affairs on public funds. The reforms are a great first step toward rebuilding public trust in our elected representatives.
What is it that too many politicians don’t get about the inappropriate use of taxpayer-funded expenses and the need to reform federal political donations laws and establish a federal anti-corruption body?
The answer to those questions may help explain why MPs continue to behave inappropriately in each area. This is important, as the impact of politicians’ inappropriate decisions on people’s trust is becoming alarming.
It is now evident that too many politicians appear to have misplaced their moral compass. When this happens in any one of the policy areas referred to above, people’s trust in their elected representatives is eroded. But when inappropriate actions and decisions span all three policy areas, trust is lost, sometimes permanently. If that happens, it is not only the reputation of politicians that suffer. Lack of trust extends to the democratic political system itself.
Public office is a public trust. Any MP who understands, accepts and acts on that principle will surely insist that the public interest be placed before personal and party interests.
The latest in a series of scandals relating to MPs’ inability to understand the difference between public and private interests involves federal Health Minister Sussan Ley.
The public reaction to it should send a strong message to all parliamentarians. The message is: voters are fed up with political scandals consuming elected representatives’ time and energy, especially when the country faces several social and economic challenges. MPs cannot find solutions to these important issues when they are constantly distracted by the behaviour of too many of their colleagues.
Perhaps parliamentarians need reminding that taxpayers do not pay them to take advantage of a totally inadequate parliamentary entitlements scheme with too many loopholes, through which many of them willingly jump.
Federal MPs also need to remember that people do not pay taxes so that they can deliver a political donations regime that is pathetically weak. For years, parliamentarians have turned a blind eye to evidence-based reports and the advice of experts in the political donations field. Both have said time and again that meaningful reform is urgently required.
The Joint Standing Committee on Electoral Matters is due to bring down a report on political donations in March. It will be a test for the committee to come together and demonstrate that it has placed the public interest before party and personal interests. The nature of its recommendations and the speed with which they are implemented will reveal MPs’ commitment to cleaning up this neglected policy area.
Voters have made it clear that they want their elected representatives to be accountable for how they spend taxpayers’ money. One of the best ways to ensure this is through an independent, federal anti-corruption body. A division within such a body could also offer advice to parliamentarians unsure about whether an expense is directly and predominantly related to their role as parliamentarians, or is largely personal in nature.
The evidence clearly demonstrates that many parliamentarians have deliberately dragged their feet when it comes to reforming the “entitlements” scheme and overhauling the woefully inadequate federal political donations regime. They have also resisted the establishment of a federal anti-corruption body. Detailed explanations as to why they have acted in this way are required.
The delays are not only on reforms that affect serving members of parliament. It seems they are also looking after former colleagues. Despite promising to overhaul the entitlements system that still applies to many people who were once parliamentarians – some many years ago – nothing has happened in the past two years.
Why? Is it too difficult? Again, a detailed explanation is required and not one that says “we are looking into it” or “we will establish a committee to do so”. These excuses are becoming tiresome to everyone except MPs.
The very best new year’s resolution every MP could make is to promise to work toward restoring people’s trust, which is at a dangerously low level. An excellent place to start would be reforming, in a meaningful way, MPs’ entitlements and the political donations regime. Establishing a federal anti-corruption body would go a long way towards completing an integrity circle.
All these reforms are achievable this year. The only major obstacle to be overcome is parliamentarians’ lack of resolve to do so.
The ongoing legal controversies surrounding Western Australian senator Rod Culleton – described by a Federal Court judge as “something approaching a carnival, if not a circus” – took a new turn on Wednesday. Senate President Stephen Parry made the constitutional step of notifying the WA government of a Senate vacancy due to Culleton’s disqualification following a long saga over his eligibility to sit in the upper house.
Culleton’s disqualification comes after Parry received formal notification of Culleton’s status as an undischarged bankrupt.
Even before the 2016 election results were formally declared, questions were being asked over whether Culleton was actually eligible to be a senator. Since that time, two key constitutional issues have emerged.
The first issue relates to a larceny charge in New South Wales concerning a A$7.50 tow truck key. Culleton was convicted in March 2016. However, the conviction was annulled in August, meaning it “ceases to have effect”.
While Culleton later pleaded guilty at a rehearing in October, no conviction was ultimately recorded.
In November, the Senate referred this conviction’s constitutional impact to the High Court, sitting as the Court of Disputed Returns. The issue is whether Culleton’s election was valid under Section 44(ii) of the Constitution, which provides a person is incapable of being a senator if they have:
… been convicted and is under sentence, or subject to be sentenced, for any offence punishable under the law of the Commonwealth or of a state by imprisonment for one year or longer.
The larceny conviction falls squarely within this section’s scope. The critical question is whether Culleton had actually been convicted at the time of his election (and was therefore ineligible), given this was subsequently annulled.
The central issue concerns the word “annulment”. If the Court of Disputed Returns holds that the conviction never existed then this issue falls away. If, however, the effect of an annulment is not retrospective then Culleton was never eligible to be elected.
At the conclusion of hearings on December 7 the court reserved its decision. It is not scheduled to sit again until January 30.
There is no guarantee that a decision will be handed down at the next sittings, or before the Senate next meets on February 7. However, the court has previously recognised the public interest in this matter being resolved expeditiously.
The second issue concerns bankruptcy proceedings filed against Culleton.
On December 23, 2016, a Federal Court judge ordered that Culleton’s estate be sequestrated (or seized to pay his debts). All proceedings under the order were stayed for 21 days; this stay was due to be lifted on January 13.
Culleton continues to assert he is not bankrupt, and is able to pay his debts. However, the Federal Court judge dismissed this. He noted that, despite assertions made before the court, there was “no material evidence” produced to support these claims. An appeal against the sequestration order was filed on January 11, but no date has yet been set for the appeal hearing.
The effect of a sequestration order is that the debtor becomes a bankrupt. In Culleton’s case, this then enlivens sections 44 and 45 of the Constitution. These provide that an undischarged bankrupt is incapable of sitting as a senator, and their Senate position becomes vacant.
Parry’s statement indicated he has received from the inspector-general in bankruptcy and the Federal Court registry documents recording Culleton’s status as an undischarged bankrupt. The necessary constitutional implication is that Culleton’s Senate position is vacant.
This saga still has some way to go before its conclusion. But it is almost certain that Culleton will not be able to continue as a senator.
Even if he successfully appeals the sequestration order and the Court of Disputed Returns rules in his favour, Culleton still faces further constitutional hurdles. Another creditor’s petition is yet to be heard by the Federal Court, and a stealing charge is listed for trial in Perth in September 2017. These could each result in Culleton being constitutionally precluded from sitting as a senator.
From a constitutional perspective, however, it is critical that the correct grounds for disqualification are established. This will affect how a replacement senator is chosen.
If the Court of Disputed Returns rules that Culleton was never eligible to be elected, then – based on precedent – the most-likely outcome is that the second-listed One Nation candidate from the 2016 election will be declared elected. This happens to be Culleton’s brother-in-law, Peter Georgiou.
If, however, Culleton was initially eligible but is subsequently disqualified as an undischarged bankrupt, then a casual vacancy would arise to be dealt with under Section 15 of the Constitution. In this case, One Nation would recommend a party member to fill the vacancy, and the WA parliament would formally appoint this replacement.
If the WA parliament is not in session – which is a distinct possibility given a state election will be held on March 11 – then the WA governor will make the appointment, which must then be confirmed at the next state parliamentary sittings. One Nation leader Pauline Hanson has already tweeted that she has selected a “great person” as a replacement if a casual vacancy is declared.
Given these possibilities, it would be prudent to wait until both the existing bankruptcy appeal and the Court of Disputed Returns’ decision are finalised before taking any steps to fill the vacancy. This is far from ideal given both the close numbers in the Senate and that WA will be under-represented in the “states’ house” for as long as the position remains unfilled.
However, the removal of a senator who was duly elected by the people only six months ago is not something to be done lightly. And it is certainly not something to be done on anything other than conclusively determined constitutional grounds.
Immigration Minister Peter Dutton recently raised the prospect of changing the law around acquiring Australian citizenship.
He acknowledged the vast majority of migrants are well-integrated, and should be fast-tracked for citizenship. However, Dutton would like to see criteria tightened to deny citizenship to those who have not integrated into Australia. While details are unclear, he referred to people involved in serious crime, those who are welfare-dependent, or who have links with extremism.
Dutton was also concerned about people who don’t undertake English lessons or prevent their children from being educated.
Permanent residents in Australia enjoy almost the full range of civil and political rights as citizens. They have access to the welfare system (after initial waiting periods), Medicare, and education.
Citizens alone are able to vote and have a greater security of residence. They are subject to removal only if they have fought for the armed forces of an enemy country or, since 2014, if they are involved in activity defined to be linked with terrorism.
Citizenship is important for people to feel fully connected and committed to Australia. For some – in particular refugees – the increased security of residence is of extremely high importance, given they are unable to return to their countries of origin for fear of persecution.
For those who came to Australia by boat, citizenship is the only pathway to sponsoring family members to join them.
Citizenship is the final step in a process of becoming a full member of the Australian community. There are many checks along the way.
When Australia admits permanent residents, the expectation is that they will stay permanently and take up citizenship at some point in the future. When permanent residents become citizens it is a marker of their successful integration.
Knowing that permanent residents are likely to be future citizens, Australia makes difficult policy choices around the balance of skilled, family reunion and humanitarian migration.
The government sets a target for the maximum number of new residents each year, and visa-holders are subject to rigorous checks to ensure they meet the criteria for those visas. These checks include detailed security and character assessments.
By the time a permanent resident is in a position to apply for citizenship, they must have lived in Australia for four years and have remained of good character during that time. If they do not remain of good character, their visa may be cancelled and they can be removed to their country of origin.
The immigration minister regularly exercises this power – even, controversially, in relation to long-term permanent residents with children in Australia.
Also, as part of eligibility for citizenship, a person must be of “good character” and must provide national police checks. The Department of Immigration can also request Interpol and overseas police checks.
a “basic knowledge” of English; and
“an adequate knowledge of Australia and of the responsibilities and privileges of Australian citizenship”.
Citizenship tests are not well-suited to testing an applicant’s “values”. They are also a crude measure of an applicant’s level of English.
Australia’s test no longer contains questions about cricketer Don Bradman, after it was reviewed in 2008. It now focuses on knowledge of the institutions of government, and of basic constitutional values such as free speech.
Being able to rote learn these values is not an indication that a person lives by them. And the language of values and rights is complicated, and not a useful test of basic English literacy skills.
Questions remain as to whether it is possible to test for successful integration into Australia.
A recent Productivity Commission report framed integration as both economic integration and social inclusion. It is not just the skills and efforts of individual migrants that are key to promoting integration, but the societal attitudes, and government policies and programs that support settlement and removing barriers to integration.
The most important benefit of citizenship for migrants is the sense of inclusion and acceptance into their adopted community. Requirements for citizenship should therefore promote inclusion, not exclusion.
Discussions that focus on exclusion have the potential to alienate sectors of the community. They are a hindrance to people obtaining a sense of connection in Australia.
As Dutton observed, there are good reasons to encourage permanent residents to take up citizenship: for one, it enhances their integration in the community.
To the extent that poor English and poor understanding of Australian values is a barrier to this integration, the government needs to increase its efforts to educate prospective citizens – not look for ways to exclude them.
Alex Reilly, Deputy Dean and Director of the Public Law and Policy Research Unit, Adelaide Law School, University of Adelaide and Mary Anne Kenny, Associate Professor, School of Law, Murdoch University
The government of Timor-Leste has officially notified Australia of its wish to terminate the 2006 Treaty on Certain Maritime Arrangements in the Timor Sea (CMATS). The treaty sets out the division of revenue from the Greater Sunrise oil and gas fields, an estimated A$40
billion deposit in the Timor Sea.
The maritime border between Timor-Leste and Australia has been a source of contention over recent years. But the decision to terminate the treaty and begin negotiations anew could have serious ramifications for Timor-Leste’s economic development, given its dependence on the Timor Sea resources.
The CMATS treaty was designed to enable the joint exploitation of the Greater Sunrise field. The treaty circumvented the competing border claims by placing a 50-year moratorium on negotiating maritime boundaries betweeen Australia and Timor-Leste.
The Sunrise International Unitisation Agreement, finalised in March 2003, agreed that 20.1% of Greater Sunrise was located in the Joint Petroleum Development Area (JDPA) established under the 2002 Timor Sea Treaty and 79.9% within Australia’s jurisdiction.
If the maritime border was drawn halfway between Australia and Timor-Leste, the oil and gas fields would fall completely within Timor-Leste. Under CMATS, however, Timor-Leste negotiated a 50:50 revenue-sharing arrangement.
In 2013, Timor-Leste initiated proceedings against Australia at an arbitral court (in the Permanent Court of Arbitration at The Hague) under the Timor Sea Treaty to invalidate CMATS. It did so on the grounds that Australia’s alleged spying on Timor-Leste’s negotiators in 2004 contravened the Treaty of Vienna requirement that treaties be negotiated in “good faith”.
Timor-Leste favours an export pipeline to its south coast to enable its ambitious petroleum industrialisation plans. In contrast, Australia supported the decision of the licensee consortium, headed by Woodside, that the export pipeline was not the best commercial option.
When the CMATS treaty was negotiated, these disagreements were put aside in order to reach an agreement. However, this just delayed the seemingly irreconcilable dispute about developing the field.
Timor-Leste’s government has developed a narrative that maritime boundaries are necessary for completing its sovereignty. This narrative has linked the independence movement to the sea disputes in order to bolster public support against Australia. Consequently, the moratorium on forming permanent boundaries had increasingly become a problem in relations between Australia and Timor-Leste.
In 2015, Timor-Leste’s government initiated a United Nations Compulsory Conciliation under Annex V of the UN Convention on the Law of the Sea (UNCLOS) in a bid to pressure Australia into changing its policies on Greater Sunrise.
Timor-Leste’s withdrawal from CMATS is not a surprise. In the opening statements of the conciliation process, Timor-Leste’s representatives flagged this as a likely action.
The careful wording of the joint statement makes it clear that the Australian government “recognises” Timor-Leste’s right to initiate the termination of the treaty. This does not suggest that Australia has substantially shifted its long-standing policies on the Timor Sea. However, the joint statement does indicate that the Australian government recognises that maintaining the CMATS treaty had become untenable.
Terminating CMATS reflects a continuation of Timor-Leste’s high-stakes approach to Timor Sea diplomacy.
Negotiations on establishing a permanent maritime boundary will continue under the UN Compulsory Conciliation. This process is designed to help states resolve bilateral maritime disputes by providing recommendations from a panel of experts.
The Australian government has repeatedly emphasised the non-binding nature of these recommendations. While Australia has an obligation to negotiate in good faith, this does not mean it can be forced into agreeing to a maritime boundary. Negotiated boundaries still appear to be some way off.
Timor-Leste will be pushing for permanent maritime boundaries that will give Timor-Leste most, if not all, of Greater Sunrise in order to support its ambitious oil industrialisation plans.
Terminating the CMATS treaty ultimately means that the governments of Timor-Leste and Australia are back to square one in negotiations over Greater Sunrise.
There are a number of potential consequences for Timor-Leste.
First, the revenues that flowed from the Joint Petroleum Development Area under the Timor Sea Treaty have provided approximately 90% of Timor-Leste’s state budget. The Bayu-Undan oil field is expected to be depleted by 2022 or 2023.
Without a source of revenue, Timor-Leste’s economy would be at serious risk of collapse: the A$16 billion petroleum fund could be depleted by 2025. The risk for Timor-Leste is that Australia will prolong boundary negotiations, putting more strain on its finances. Timor-Leste’s vulnerability increases as the window for resolving the dispute before oil revenues run out narrows.
Second, the Exclusive Economic Zone and continental shelf claims of Timor-Leste and Australia overlap with those of Indonesia. While the spectre of Indonesia’s future involvement in the dispute is largely ignored in the media, it would be naïve to believe that Indonesia would not become a third claimant if the opportunity arose.