Australian Referendum on Local Government - 14 September 2013 - Jack Roach BRAG

The main purpose for this referendum is mainly to provide clear constitutional power to the Federal Government to directly fund local councils for a significant number of programs that have been put in jeopardy by two High Court decisions handed down in recent years.

 
The Federal Government currently provides Councils nearly $3 billion annually with 80% of this through the State Governments, which allows them some degree of say in how this is spent, and 20% by direct funding to the councils, which is used to finance Roads to Recovery programs and a number of other smaller projects.
 
Without clear constitutional power, the direct funding may be in jeopardy by a future High Court challenge and the proposed amendment would make the Commonwealth
powers clear to continue direct funding.
 
However, there are two other reasons for the referendum. The first is part of a deal struck with the independents to resolve the hung parliament at the last election and the second is to provide formal recognition of local councils as a third tier of government..
 
These last two reasons are questionable complicating the publics’ decision to vote for the amendments. Therefore the chances are that the yes vote may be swamped by the no votes. In Australia historically the no votes most often far outweigh the yes votes in referendums.
 
Many will argue that the direct funding issue could allow the Federal Government to cut the States out altogether and fund the local councils directly at the local level to gain greater control over council policies and provide some kudos for the Feds.
 
The councils will be arguing that by directly funding there will be savings in administration costs and they might also argue that a greater proportion of funding could be channelled to the councils in this way.
 
Councils will also be saying that by recognizing local councils as a third tier of government in the constitution will be significant as they are not currently mentioned in the constitution at all.
 
The danger is that if a greater proportion of direct funding results, future Federal Governments could select or manipulate the allocation of funded projects.
 
All of this will make the publics decision difficult as we will be unsure just how much power future Federal governments will be able to wrest from the states
by the use of various (underhand) interpretations of an amended constitution.
 
There is currently political bi-partisan support for this referendum and, because the draft amendment bill has only recently been released, there will be some re-thinking until the final specific terms are drawn up and the politicians and political commentators have had time to digest exactly what the  implications might be.
 
The Minister for Regional Development and Local Government, Anthony Albanese is adamant that the impact on the States influence will be minimal but we are not so sure. It is possible of course that the legislation could provide safeguards against manipulation and guarantees of continued funding through the State governments as well as direct federal funding.
 
Over the next few months it is anticipated that there will be more defined and better thought out responses, so keep your eye on what comes up in the media.
 
Jack Roach
President - Boroondara Residents Action Group (BRAG)