Federation reform


  • Date:01 Oct 2015
  • Type:Company Director Magazine

John Brogden explains why longer parliamentary terms for Australia’s governments will help overcome short-term decision making and benefit the nation. 

Last month I wrote an opinion article for Fairfax media to encourage a debate about the need for federation reform. I argued that Malcolm Turnbull’s 21st century cabinet needs a 21st century system of government to deliver on its promise of reform. As Australia’s peak governance organisation, the Australian Institute of Company Directors is in a unique position to offer guidance on the governance structures that will enable our country to perform at its best. The reality is that no competent director - public, private or not-for-profit - would govern their organisation the way we govern the country.

Directors operate under a 21st century, world’s best corporations law that changes regularly to adapt to the needs of consumers and the economy. In contrast, Turnbull’s recently appointed cabinet will operate within a system that was designed in the 19th century and has changed little since. The wigs and gowns are gone, but the machinery of government still bears their hallmarks. We need a system that allows our governments to make long-term decisions in the best interests of our nation. A three-year term of the national government practically delivers only two years of unhindered governing. Ask any chair, director or chief executive officer if they can develop, consult and implement major reform in two years.

The Commonwealth and Queensland remain the only two jurisdictions with three-year variable terms of parliament. Over the last 30 years, the other jurisdictions with three-year terms have moved to four years, and most have also adopted a fixed term. Compare this to four years in the US and Germany, and five years in the UK, France and Indonesia.  

The term of the Commonwealth Parliament must increase to four years with either a fixed term or a minimum three or four years to give elected governments time to consult, legislate and implement important reforms – and for the people to see the reform in practice before judgement. We must also reform the election laws that allow the senate to be controlled by minor party and independent senators with ridiculously low primary votes. 

I’m not suggesting making it easier for governments to control the senate. We have a long tradition of third parties and genuinely popular independents in the senate. But electoral mandates and urgent responses to security and economic emergencies must be respected. 

There are other flaws in our political system too. Ten years ago, in another life in politics, I wrote in The Australian about the failures of our federated system of government. I said: “Our federal system is broke. It is a confused, duplicated and an irresponsible mess of failed public administration. Council of Australian Governments (COAG) risks becoming a club of Australian governors rather than a reform vehicle.” Back then the participants embraced “cooperative federalism”. Ten years later the niceties of COAG have delivered very little reform. With the exception of the veteran WA politician, now Premier, Colin Barnett’s clear frustration, today’s participants continue the pantomime that COAG is the nation’s reform vehicle. Over the last 20 years, the old school combative Premier’s Conferences have been replaced by the pleasant but increasingly useless COAG.

And in this time, despite the neatness of the funding arrangement flowing from the GST, the blurred lines of state/federal funding and responsibilities has, with very few exceptions, actually gotten worse.

Skills education – a major prerequisite for a productive and competitive economy – is still run separately by each state. Workplace relations and work health and safety remain with a semi-complete national regulatory structure. These are areas in which the division of Commonwealth and state responsibilities must be resolved.

The only notable success of the last 10 years, although still a work in progress, is the National Disability Insurance Scheme.

Finally, Australia’s governments need to commit  to an agenda of practical federalism in microeconomic reform and the elimination of the remaining areas of duplication. When was the last time you heard a Prime Minister or Premier talk about microeconomic reform? While there are some signs of hope, not since Bob Hawke and Nick Greiner’s “New Federalism” agenda in the early 1990s have we heard a shared vision for reform. These debates require reasoned argument and the willingness for us all to win and lose for the nation’s betterment.