Under the Australian Constitution, legislative power is divided between the Commonwealth and State parliaments.

Compare and contrast their legislative power and analyse the effectiveness of this division. The Commonwealth of Australia Constitution Act 1900 (UK) was implemented on January 1st 1901, at which time Australia united its six independent colonies. The Founding Fathers who wrote the Constitution created their government in the manner of a federal system of government meaning that the legislative powers are divided between the Commonwealth and state governments. They did this so the colonies would retain much of their original power with a Commonwealth Government only ruling over national issues. While this was the Founding Fathers intention, over the past 100 years this division of powers has not always been effective. Problems created by this division include the shifting of power to the Commonwealth, which increases their hold over areas that are meant to be state powers and the requirement for co-operation between governments. However, recently initiatives have been developed aiming to preserve the division of powers and therefore increase effectiveness. Federation occurred on January 1st 1901 at which time the Constitution was implemented. As outlined in the Constitution the states have the majority of the legislative power while the Commonwealth has limited legislative powers over national issues only. This was the Founding Fathers intention when writing the Constitution; they were primarily concerned with making sure that despite the fact a national authority was being created, the colonies still retained much of their original legislative powers. The Founding Fathers also created the High Court, the highest court in Australia. It derives its power from section 71 of the Constitution and is crucial in interpreting the divide between the Commonwealth Government and the state governments. When ruling on cases between states and the Commonwealth, the High Courts duty is to interpret and apply their interpretation of the Constitution. Originally, several of those who had a hand in writing the Constitution were judges in the High Court and when problems surrounding the divide arose they could be interpreted as the Founding Fathers meant it to be. But as time continued, the judges were replaced and as Australias social needs changed so did the interpretation of the Constitution and today the High Court has been highly influential on how effective the division of legislative powers has been. The legislative powers are divided into four categories; exclusive, prohibitive, concurrent and residual. Exclusive powers concern only the Commonwealth Government. It has the sole right to make laws in areas that relate to the Australian Capital Territory, matters relating to the control of the public service and other specified or enumerated matters declared by the Constitution. Many of these are listed in Section 51 of the Constitution (though not all the powers in Section 51 are exclusive powers) such as Section 51 (xii) which gives the Commonwealth the sole right to make laws concerning currency or Section (vi) which specifies only the Commonwealth can make laws about defence. In these cases it is clear that only the Commonwealth can make laws in these areas as the states are specifically prohibited in the Constitution. There are also areas that the Commonwealth is specifically prohibited from making laws in. The main prohibitions are concerned with protecting the states. Section 92 provides freedom

of trade or commerce to any state and Section 99 stipulates the Commonwealth cannot make a law that gives preferential treatment to one state over another. Other prohibitions protect the rights of individuals, such as the freedom of religion and the right to trial by duty. Concurrent powers are those legislative areas that both the Commonwealth and state governments are able to make laws in. These include areas such marriage, divorce and bankruptcy. When a Commonwealth and a state law overlap, the state law is rendered invalid and the Commonwealths law takes over under Section 109: When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid. However, this is not automatic and must be brought to the High Court. There are also a number of matters that are not specified in the Constitution and are known as residual powers. Residual powers pertain to all other legislative powers not mentioned in the Constitution and therefore belong to the states. Under residual power the states can make laws in the area of criminal law, police, education, health and the environment. As the legislative powers are divided this way it often more complex to operate government and make laws than if there was just one central government. Questions have been raised over the effectiveness of the division of powers. For the division of powers to be effective, it would need to function for the benefit of all Australians and the states would have the majority of the legislative power as changing the divide would not reflect the Founding Fathers intention and could create problems. However, the divide in power has changed and several problems have occurred. One of the biggest problems in the division of powers is the Vertical Fiscal Imbalance (VFI) caused by the First Uniform Taxation Case South Australia v. Commonwealth (1942) 65 CLR 373. VFI means that the states have relatively large responsibilities assigned to them in the Constitution that they need to spend money on, however they have few sources through which to create their own revenue. In comparison the Commonwealth has limited spending responsibilities assigned to it in the Constitution, however it has many sources of revenue. Prior to 1942 Australia did not have a VFI. The people of Australia paid a certain income tax to both their state government and the Commonwealth government and traditionally income tax was the greatest revenue raiser for the states. However when World War Two commenced the cost for Australias defence skyrocketed and the Commonwealth government raised their percentage of income tax to account for the rising costs. With this raised tax it became obvious that some states were at a disadvantage as some states charged a higher tax than others. To remedy the imbalance the Commonwealth decided to centralise the income tax and redistribute it amongst states. South Australia objected to this and brought the Commonwealth government to the High Court stating that the move to centralise tax was a sign of the Commonwealth misusing its power. The High Court disagreed with the state and established that the Commonwealth had the power to tax incomes giving the Commonwealth a great advantage over the states. When the war ended the common belief was that once the defence bill was paid, the Commonwealth would no longer centralise tax, however this was not true. Therefore, the issue was again raised in 1957 by the Victorian government in the High Court where the High Court supported its original decision. Another case from the High Court that increased the Commonwealths financial advantage over the states was the Ha v. New South Wales (1997) 89 CLR 465 case. This case involved two New South Wales tobacco wholesalers who were charged by the New South Wales

government for avoiding $2.2 million in state franchise fees. The wholesalers took the New South Wales government to the High Court where the Ha defence claimed that the fees were unconstitutional. The court ruled in favour of the Ha party, determining that state franchise fees on tobacco sellers were unconstitutional as the fees were excise duties, an exclusive power of the Commonwealth. These cases have not only given Australia the worlds largest VFI; today the Commonwealth is also able to control how the states spend the money that is distributed to them (known as grants). Under section 96 of the Constitution it states: The Parliament may grant financial assistance to any State on such terms and conditions as the Parliament thinks fit. This means that the Commonwealth Government can determine exactly how the grants are to be spent. This undermines the effectiveness of the division of powers as the states are totally dependant on the Commonwealth for support and gives the Commonwealth a means of controlling state spending. The states reliance on the Commonwealth has been furthered in recent years due to the introduction of the Goods and Service Tax (GST). When the GST was first introduced by the Commonwealth Government an agreement was penned between the states and Commonwealth determining that revenue that was raised through the GST would be distributed between the states and territories on the provision they eliminated other taxes such as stamp-duties, banking taxes and land value tax. This GST further undermines the division of powers as it causes the states to further rely on the Commonwealth for support. Other significant High Court cases have seen the Commonwealth increase its power in residual areas. This has happened through the use of the external affairs power contained in Section 51 (xxix). Through external affairs the Commonwealth is able to enter into international treaties and conventions and then pass legislation to execute the terms of the treaty, of which the states must observe. This has the potential to limit the states residual powers undermining the effectiveness of the division of powers. Two cases have seen this happen. The first was Koowarta vs. Bjelke-Peterson and Ors (1982) 153 CLR 168. In 1982 the Aboriginal Land Fund Commission entered into a contract to buy a pastoral lease. The Queensland Minister of Lands refused to give his consent to this as the Queensland government was opposed to the acquisition of large parts of land by Aboriginals. Mr Koowarta took the government to the High Court claiming that the Premier had breached sections of the Racial Discrimination Act (1975), which was a Commonwealth law. The Queensland government responded by challenging the Commonwealths power to make laws on racial discrimination as it was a residual area of power. The High Court decided that the Commonwealth did have the power to make laws of racial discrimination as the international treaty; the Convention of the Elimination of All Forms of Racial Discrimination was under the jurisdiction of external affairs. Another case concerning the Commonwealths external affairs power was the Franklin River Dams Case (1983) 46 ALP 625, in which the Tasmanian government challenged the World Heritage Properties Conservation Act 1983, passed by the Commonwealth Government. The case concerned the prohibiting of the Tasmanian government to dam the Gordon River just below it junction with the Franklin River in the South-West of Tasmania. The area was nominated by the Commonwealth Government to be included in the World Heritage list, established by Australias signing of a treaty to protect the worlds natural and cultural heritage areas. The case was taken before the High Court to establish whether the Commonwealth could prohibit the construction of the dam. The Commonwealth argued that the external affairs powers allowed it to legislate the terms of the treaty. The High Court

agreed, successfully blocking the construction of the dam. Like Koowarta this had a limiting effect on the states residual power. Recently, the effectiveness of the division of powers has been called into question again, after the Commonwealth Government created the Workplace Relations Amendment (Work Choices) Act 2005. Many of the state governments objected to these laws, taking the Commonwealth to the High Court as the Commonwealth government does not have a general power to regulate industrial relations. The Commonwealth, instead, had used their Corporations power which gives them the power to make laws in relation to trading, financial and foreign corporations. The states questioned the Commonwealths power to do this as it could limit the states power; however the High Court decided otherwise stating it would only impermissibly alter the federal balance. It is not just through High Court cases that the effectiveness of the division of powers is undermined. The states are able to hand their legislative power over to the Commonwealth voluntarily; however, while the process is voluntary it is often furthers the ineffectiveness of the division of powers. This happened recently with the recent Murray-Darling Basin debate in which the Commonwealth announced that the region was facing a dangerous water shortage and that water may have to be reserved for urban water supplies. The Commonwealth government proposed a $10 billion Commonwealth take-over arguing that effective management could not be undertaken by competing state governments. New South Wales, Queensland, South Australia and the Australian Capital Territory agreed but Victoria refused. Eventually Victoria agreed and legislation was passed to authorise the take-over and power that was once under the states jurisdiction is now the Commonwealths undermining the effectiveness of the divide in power. Examining these cases it becomes obvious that it is not just through the shift in power to the Commonwealth which has resulted in the ineffectiveness of the division of powers. A characteristic feature of the division of powers is the many governments a national authority, six state governments and two territory governments. These governments are very competitive, as the previous cases show. State governments often compete with other states and also compete with the Commonwealth to maintain their legislative power and to be treated fairly. This hinders the effectiveness of the division of powers as these procedures turn into long and arduous processes which disadvantage citizens and causes tensions between states and the Commonwealth. While there are many that undermine the division of powers effectiveness, a relatively new concept, the Council of Australian Governments (COAG), started in 1992, has aimed to correct this. The role of COAG is to develop and implement united policy reforms in all state and Commonwealth governments that are of national significance but are in legislative areas of the states. This means that the Commonwealth government does not take over the states power but instead aims to unite the legislation by having the states pass the same legislation on the same issue; for example the gun law reforms that took place after the Port Arthur. The Commonwealth, state and territory governments met and the states and territories agreed to implement uniform gun laws that had been proposed by the Commonwealth. By resolving problems this way the division of powers is preserved and is therefore effective, though the process is long and arduous. The divide in powers is a result of the Founding Fathers intentions, while writing the Constitution, so the colonies would retain much of their power. However, the Founding

Fathers could not predict the trials and tribulations that would face Australia over the next century and as a result the divide has not always proved effective. The shift in power towards to the Commonwealth has been a major reason as it has resulted in the states legislative power being undermined. The division of powers is also undermined by the Commonwealth and state disagreements. However, there are some effective points of the division of powers such as initiatives like COAG which ensure the states and Commonwealth are united in legislation, without the Commonwealth removing the states power.

Bibliography
Aldous, J. (2001). Making and Breaking the Law 6th Edition. Macmillan Education Australia Class handouts and notes