Judi Moylan (Pearce, Liberal Party) Share this | Hansard source

As I was saying, I am a strong believer in the Federation. I think we need to make genuine efforts to strengthen the Federation and not to have the imbalance where the federal government constantly calls the shots and expects the states to jump to its tune. There are a number of things that are supportable in this legislation, but what concerns me about it is that it is old policy with a new heading. It is a bit of a pea and thimble trick.

The bill purports to provide much needed flexibility for states in how they choose to apply funding. While this may be so for the specific purpose payments, it is clearly not the case for the national partnership payment. These payments will tie states to national policies in order for them to receive funding. Quite apart from this being against the needs based funding of horizontal fiscal equalisation, it is also contrary to the notion of subsidiarity. It is for the states, those closest to the people, to decide which priorities to pursue. It is not responsible federalism for the central government to determine which policies are of national importance and threaten to cut funding for noncompliance with their decision.

If you look at the issue around housing policy, for example, the Council of Australian Governments said that leadership for housing and homeless policy, including Indigenous policy, will be the main responsibility for the states but the Commonwealth will have leadership responsibility. What does that mean in reality in producing a difference for those people out there in the community who are currently finding it so extremely difficult to obtain affordable housing? What is this so-called leadership role that the Commonwealth is going to play? What portion of funding is that taking up compared with what is given to the states to try to resolve this matter?

With the little bit of time that I have I would like to quote from a very good article in the Australian newspaper by the author James Allan. He noted:

… the Rudd Government’s Obama-like and high-flown rhetoric about federalism is a lot of hot air. Take every mention of ‘cooperative federalism’ and replace it with ‘do as we say and we might throw you a few crumbs you otherwise won’t get’ and you’ll have a more or less perfect idea of what is going on.

I do think that this very succinctly sums up some of my deep concerns about this bill and about clearly defining the areas of responsibility. I think the Commonwealth has to take more than just a leadership role in some of these areas. It must ensure that the states are properly and adequately funded to address the many challenges that are faced and will continue to be faced in a difficult financial situation.

I would like to conclude with a statement from a 2006 Western Australian Department of Treasury and Finance report, because this issue of funding has been a thorn in the side of successive Western Australian governments for some time now. In the 2006 report they noted that the subsidiarity principle:

… has particular traction in a state like Western Australia, where small population, distance from Canberra and the very different geographic and economic characteristics compared to the populous east coast of Australia…

make a very big difference in how that state is governed. As I said before, the arrangements in this bill are far too prescriptive and kill off innovation and the ability of governments to find local solutions for local problems.

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