Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

I rise tonight to speak on the preliminary report on the majority finding of the Expert Panel on Constitutional Recognition of Local Government: the proposal, timing and likely success of a referendum to amend Section 96 of the Australian Constitution to effect financial recognition of local government. This is a very important debate. The committee was headed by the member for Greenway

I note the presence in the chamber of the member for Makin who has been a fine mayor of the City of Salisbury in South Australia. I know that some of the members on this particular committee have had local government experience, including the member for Parkes, Mark Coulton, who was a previous mayor of Gwydir shire, as well as the member for Ryan, Jane Prentice, who was a councillor on the Brisbane City Council. They are two of five members of the committee who have put in a dissenting report, the others being the member for Swan, Steve Irons, and Senators David Fawcett and David Bushby.

The first recommendation of the preliminary report says:

The Committee recommends that a referendum on financial recognition of local government be held in 2013.

It further states that:

Given the importance of securing state and territory support, the Committee further recommends that in addition to the efforts of the local government sector, Commonwealth Government Ministers, particularly the Minister for Regional Australia, Regional Development and Local Government, the Attorney-General and the Special Minister for State, immediately commence negotiations with state and territory governments to secure their support for the referendum proposal.

I know this report came out in January 2013 and the Prime Minister has set the date for the next federal election as 14 September this year. Now that it is already 13 March one has to wonder whether in fact there will be time to secure those important yes votes to ensure that this gains the necessary majority to become a change to the Constitution. In Australian history there have been some 44 referenda and only eight of these have met the requirements of a double majority and passed. The first was in 1906 and the last, interestingly enough, was to do with the retirement of judges which was passed on 21 May 1977, providing for a retirement age of 70 for all federal judges. Eight out of 44 is not a great success rate. This is too important to put to the people of Australia and not to have it passed.

I have 13 local government areas within the electorate of Riverina. There are two city councils, Wagga Wagga and Griffith, and 11 shire councils. The mayors of those local government jurisdictions know, and have told me, how important it is to get constitutional recognition, certainly for financial aspects, to allow them to get funding directly from the Commonwealth, for important infrastructure projects such as roads and for all manner of requirements.

The Tumut Shire Council is in the process of building a new pool at Adelong. The original pool at Adelong—one of the first pools in country New South Wales—was erected in 1930 in the creek which runs through that town and was washed away in the floods of late 2010. Tumut Shire Council General Manager Bob Stewart discovered within the legislation a betterment clause. He fiercely, passionately and diligently followed that through. Only the other day was the first sod turned on the site for that pool, which comes under betterment funding. Mick Veitch, the Labor member of the New South Wales Legislative Council in New South Wales, was there. He fought vigorously for this. This is really relevant. Mick Veitch lived in Adelong and now lives at Young. He fought passionately through his channels in the New South Wales parliament. I also fought passionately. I had many meetings with the then Attorney-General, Nicola Roxon. She understood the importance of the project. Through Bob Stewart's fierce determination it was made possible.

Unfortunately, that loophole has now been shut. I think governments of all persuasions feared that they would get a run on these projects. Certainly with the natural disasters that we have had in recent years that could well be the case. But that case proved the point that, with a whole-of-government approach, with local, state and Commonwealth governments all working together, such projects are possible. Sometimes middle management, the state government, through bureaucratic means holds up necessary funding projects. It sometimes does not permit the Commonwealth to directly fund local projects of significance. The Adelong pool funding is of extreme importance to that tiny community. I commend the work of Mick Veitch. I commend Nicola Roxon for making this pool project possible. I am sure that next summer the people of Adelong and the Tumut shire will be very thankful for the work that those two politicians did. They might even thank me for the work that I did in making that possible, but certainly the General Manager of Tumut Shire Council, Bob Stewart, who went stridently to ensure that the funding was made possible, will be thanked. I look forward to attending the opening of that pool next summer.

There was a dissenting report from the coalition members of the committee. They made the very real point that there is no sense in putting a referendum question to the people of Australia if it is not going to succeed. In the dissenting report, they say:

Australia is a Federation of states and, as the evidence attests, the support of State governments can make or break referenda.

That is certainly the case. They continue:

If State governments are largely opposed to change, history proves it is very difficult for referenda to pass.

In the view of Coalition members, the recommendation by the Expert Panel that the Government negotiate to achieve the States' support for financial recognition, is an essential precursor to the committee being able to make a recommendation on the likelihood of the referendum being supported by the Australian people. This view was reinforced by a number of witnesses that for the referendum to be successful, States either had to actively support the measure or at least "run dead" on the issue.

State governments are probably going to be a little bit, and in some cases very, reluctant to support this referendum because it takes away some of the power that they have, it takes away their ability to negotiate in funding allocations and enables the Commonwealth government to directly fund local government projects. This is absolutely necessary, as the pool project at Adelong showed. This is absolutely necessary, as it is in so many other essential projects where the Commonwealth needs to be able to fund local government and at the moment is not able to.

Another project within the Tumut shire that is also related to this debate is Gocup Road. Gocup Road joins the Visy mill, the pulp and paper mill, to the busy Hume Highway. It is a two-lane road that is used by very heavy B-double trucks carrying loads of timber, and quite often that road is also traversed by buses. Buses and heavy haul log trucks are not a good combination on a narrow, winding and hilly road. That particular stretch of road had to be a state criteria road for it to get Commonwealth funding. That, to me, is overburdening local government. I know that the Minister for Regional Australia, Regional Development and Local Government, Simon Crean, is very interested in this particular project—he has been to my electorate a number of times—and I know he is also overseeing this entire report, but I am sure that he, like so many others, would like to see the Commonwealth be able to directly fund this road straight to Tumut shire. As I said, it is now a state classified road—it had to be to meet the criteria of road funding—but, if that could have been skirted around in some way in the past, I think this particular stretch of dangerous road could have been funded by the Commonwealth to ensure that there is not some sort of future tragedy.

I have lobbied hard on this. Certainly it was coalition policy at the last election to fund this road through the state, and certainly, while speaking of policy and coalition policy, at the Nationals' last federal council, local government constitutional recognition was a motion which was debated and carried. The motion read:

That this Federal Council of The Nationals supports the constitutional recognition of local government so as to ensure that the Federal Government can continue to make direct payments to local governments through programs such as Roads to Recovery.

And Roads to Recovery, as the member for Parkes often attests, has been one of the great things that the Commonwealth has been able to do—that is, funding local government directly to ensure that dangerous roads and roads in disrepair in rural and remote and regional areas receive the kinds of funding they need.

The expert panel's final report has stated that a majority of panel members support a referendum in 2013, but it really needs to ensure that it is going to be passed by the people. There is no point putting the question to Australians without the benefit of a full public education campaign on the issues. It is now March; the election is going to be held in September. Does that give us enough time to get the states on board? Does that give us enough time to educate the Australian public? The Australian public are not fools; the Australian public are very knowledgeable. The Australian public are au fait with a lot of issues. They are very switched on; the amount of media that is beamed into their homes and onto their iPads and mobile phones makes them very aware of all sorts of current issues. But does this particular issue, the constitutional recognition of local government, have the necessary support and have the necessary will of the people to be passed in a referendum? I do not know whether the time that we have left would allow that question, and I will be interested in the remarks that are going to be made in a few moments by the member for Makin on that particular theme.

Certainly in the period that we have left, if there is indeed time enough to get the support for the majority that is needed to pass this referendum, then well and good, so be it, and that will be wonderful. But we cannot put this question to the people if it is going to fail, and I think that is one of the reasons why the question of Aboriginal recognition in the Constitution is also very much overdue. I am sure most, if not all, of the members of this House, including, I am sure, the member for Throsby, would agree with me there: it is overdue. That question has been delayed and it is now going to more reviews and committees, and that is probably a desirable thing because when the question gets put to the people it also has to pass for the betterment of not just Indigenous Australians but us as a nation as a whole.

Certainly, this question of the constitutional recognition of local government must also not fail, because to put it up and have it fail would mean that it would be many, many years, if not decades, before it was put again, if at all. There is no point putting a referendum question on a matter so important to grassroots politics and to the good ratepayers and citizens of this nation if it is going to fail. That is why members of the coalition wrote a dissenting report. It needs to be looked at very seriously and, as I say, I will be interested to hear the remarks of the member for Makin. This is an absolutely crucial matter. Local government needs recognition, but we must be able to ensure that it gets passed by the people.

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

I begin by thanking the member for Riverina for his kind remarks about my time as Mayor of the City of Salisbury. In speaking on this matter, I want to put the issue of local government in context. There are about 560 local governments around Australia, and each exists and is enacted under state laws and, in the case of the Northern Territory, under the Territory law. They are state laws which can be amended at any time—and in fact often are—and which prescribe the powers and functions of local government. The existence of local government effectively rests with the state and territory governments. Yet local government is and has been entrenched as a level of government in the eyes of the Australian people for decades and decades, and it is now essential to the daily delivery of services to the Australian people across the country.

In fact, the first local government was established in South Australia—it was the City of Adelaide—and councils around Australia formed soon after that. I say that to point out that local government in fact predates federal government by some 60 years. Local government is part of the Australian landscape and has been almost since the time of the first settlement in this country. Many people I speak to are surprised to hear that local government predates the federal government and yet has effectively no legal status other than that afforded to it by each of the state and territory laws. It certainly is recognised within state constitutions, but recognition in state constitution does not give it the national recognition that local government is, quite rightfully, seeking.

There were propositions in both 1974 and 1988 to change the Australian Constitution in order to give local government the recognition it, quite rightly, deserves. In 1974, the proposal was to amend section 51 of the Constitution and related to the ability of the federal government to borrow money on behalf of local government. At the same time, there was a proposition to amend section 96 in very similar terms to what is being proposed now which would have enabled the federal government to directly fund local government. The 1974 proposition failed. The 1988 proposition was slightly different: it was about inserting a new section 119A into the Australian Constitution which effectively gave recognition to local government as a legitimate level of government in Australia in a similar way perhaps to the state constitutions. Again, that proposition failed.

So, 25 years later, we are attempting for the third time to recognise local government in the Australian Constitution. The member for Riverina quite rightly points out that this is an important issue and we do not want it to fail. That was very much at the forefront of the minds of committee members at the time we were deliberating on this issue.

The report follows a previous report that was headed by Justice Spigelman and an expert panel of some 17 other members who reported to the parliament at the end of 2011 and recommended, amongst other things, that a parliamentary committee pursue their recommendations. The recommendations—and I am simplifying them here—were effectively twofold. If you can get the bipartisan support of this parliament, the support of the state governments and the support of the Local Government Association and the recommendations they submitted as part of their proposition to go forward with the referendum, then you should proceed with it. The committee looked at those issues. It also heard from some experts in the field. It formed the conclusion that section 96 of the Australian Constitution would read:

The parliament may grant financial assistance to any state or to any local government body formed by state or territory legislation on such terms and conditions as the parliament sees fit.

The additional words were 'or to any local government body formed by state or territory legislation'. That is the addition to section 96 which currently does not exist in that part of the Constitution.

The importance of what it says is that we can only fund those local governments that are formed in accordance with the laws of the state or the territory in which they exist. That is No. 1 and it is an important element of that change. The second part is that the federal government can directly fund those local government entities.

The issue of including local government in the Australian Constitution and giving it proper recognition has, I believe, got bipartisan support as a matter of principle. That is the message I am picking up loud and clear. The message I have been hearing right across Australia is that, generally, as a matter of principle, it is accepted. The issue is: how do you do it? You can include local government in the Australian Constitution simply by giving it some sort of symbolic recognition or you can actually do so in the form of words that have been proposed in the recommendation of the committee by specifically making reference to it in section 96. Symbolic recognition may be appropriate, but, quite frankly, I do not think that is the way to go. I would like to see specific reference to it.

We gave local government some form of symbolic recognition when in 2006 the Howard government in a bipartisan way in this parliament moved a resolution recognising the importance and existence of local government throughout Australia. But it was not given legal status in the same way that giving local government a seat at COAG meetings, which was also done in the nineties, gave local government a degree of respectability but did not give it any legitimate legal status. The only way we will ever do that is by including the right wording in the Australian Constitution. The wording proposed is similar to the wording proposed by the expert panel, which the parliamentary committee agreed was the best way to go. It agreed it was the best way to go because it also heard from experts in the field of dealing with the Australian Constitution and they agreed that it was the best way to go.

The fundamental difference between what is happening now and what happened 25 years ago and in 1974 is not only that local government, quite rightfully, believes that it should be recognised as a legitimate level of government in this country but because there was a court case, Pape v Commissioner of Taxation, in 2009. That court case effectively found that the Australian government does not have the authority to directly fund local government. So this issue is not simply about doing what we think is morally right; it is also about ensuring that the way this government and this country has operated for decades continues. Programs like Roads to Recovery, which the member for Riverina alluded to earlier, and other programs like the regional development programs, community infrastructure initiatives that we have seen in recent years and even direct services that are provided by local government to communities will be able to continue. That is the purpose of the changes that are being proposed now and it is important they get through as quickly as possible. It is no longer just something that would be nice to do; it is a matter of dealing with the issue because if we cannot then we have to deal with those funding problems that arise as a result of the Pape case.

The argument has been put that we can continue to fund local government through section 96 of the Constitution. However, that means all of the funding has to go through the states with conditions placed on the states that those funds will be used in accordance with the wishes and directions of the federal government. That means you have to deal with the states before allocating the funds, and that in turn makes the whole process much more cumbersome and adds another layer of bureaucracy to the process itself. That is a problem that I believe we will continue to encounter if the Constitution is not changed.

Questions arise relating to the timing, which the member for Riverina quite rightly raised in his remarks in the chamber. Those were matters that the committee rightly addressed in a very careful and considered way. We listened to the experts about the process that the parliament needs to go through before a referendum question can be put, even in September this year. It was considered that, whilst the timing may raise concerns to some, it is sufficient to enable us to go through all of those processes.

Unless a decision is made by this parliament that we will proceed with the referendum, none of the other steps will take place because everyone seems to be hanging back for someone to make the first move. Having made the first move and recommended that the referendum be held in conjunction with the federal election this year, it now means that every other sector—that is, the state governments and local governments around Australia—has a goal in mind and can work towards it. My understanding is that the local government sector across Australia generally has accepted that and is prepared to get behind a campaign that will enable the education program that has been suggested to be rolled out across Australia with respect to getting the people of Australia to understand what is behind this proposition. It is true that some of the states will never support this proposition. It is also true that if we do not get bipartisan support from this parliament to start with then the proposition will never get up.

For a constitutional question to succeed it needs not only to be passed by a majority of states but to be passed by a majority of voters across the whole of the country. So it is not easy. The member for Riverina rightly pointed out that only eight out of 44 propositions have ever succeeded when they were put to the Australian people. But it is possible. One of the successes occurred in the 1940s when a similar situation arose where it was a case of making a change to the Constitution not simply because it was the right thing to do but because if it was not done then it would impact on the way the government of the day could deliver its services. This is a very similar case. That was one of the arguments put very strongly by constitutional experts that addressed the committee.

We have a proposition before us and we have in principle support generally across the board—a couple of the states have indicated concerns but the others at this stage have not strongly indicated their position one way or the other. Given that we now have the Australian Local Government Association behind the proposition, we should now make every attempt to go through with the referendum question being put in September. The others, knowing that there is a proposition before them, will have to make some hard decisions. I believe they will do so and I believe those hard decisions will result in them supporting the proposition because it is the right thing to do and is the only way that we can effectively ensure the delivery of services which Australian people have now become accustomed to as a result of the way things have been funded over the last two or three decades.

With those comments I strongly urge members of this place to support the recommendation of the committee because this place needs to show leadership on this issue. If it does, my view is that that will be crucial as to whether the proposition gets up in September.

Debate adjourned.