MazMatters: local government

Friday, June 7, 2013

Financial Recognition of Local Government: Constitution Alteration (Local Government) 2013 Bill

The Constitution Alteration (Local Government) 2013 Bill was introduced into the House of Representatives on 29 May 2013 and Wednesday (5 June 2013) was passed by the lower house. The Bill proposes to amend the Commonwealth Constitution s96 to make specific provision in relation to the granting of financial aid to local government bodies of which there are currently 565 many of whom struggle finically while trying to meet a growing list of funding demands .

Background

The Attorney-General in speaking to the Bill said that in August 2011 the federal government had appointed an Expert Panel on Constitutional Recognition of Local Government chaired by former Chief Justice of the Supreme Court of NSW, the Hon James Spigelman AC QC (the Expert Panel) to identify options for the constitutional recognition of local government.

In December 2011 a majority of the Expert Panel members concluded that financial recognition of local government by amendment of the Commonwealth Constitution s 96 was a viable option within the 2013 election timeframe and led to the Commonwealth Parliament establishing a Joint Select Committee on Constitutional Recognition of Local Government to inquire into and report on the majority finding of the Expert Panel in November 2012. It subsequently supported the findings of the Expert Panel that a referendum on financial recognition of local government be held at the 2013 federal election.

Importance of Proposed Constitutional Alteration

The proposed constitutional alteration would amend the Commonwealth Constitution s 96 to make specific provision in relation to the granting of financial assistance to local government bodies. Such a change would allow the federal government to give money directly to local government. As such the change would be a substantive departure from the current position where local government funding and regulation is seen primarily as a state responsibility.

In a recent article in Uk Guardian, the Infrastructure Minister Anthony Albanese has described the proposed change as "modest and practical" saying "[it] simply adds into the Constitution the right of the Commonwealth to grant financial assistance to any state or to any local government body formed by a law of a state, under any terms or conditions as the Parliament thinks fit." But as he also points out: "It in no way changes the role of State Governments which will stay responsible for local councils. Under the Bill before the parliament, the Commonwealth couldn’t provide funding with terms and conditions that wouldn’t be valid under state law. It also does not interfere with the state’s rights to change local councils through, for example, amalgamations or by sacking them if the need arose."

Reaction

As the SMH reports the majority of the House of Representatives have supported the Bill:

"One hundred and thirty four government, opposition and cross benchers all voted together against only two dissidents, West Australian Liberal Dennis Jensen and NSW Liberal Alex Hawke."

The case put by those against the Bill is the "States Rights" argument that sees local government as a states matter and the Bill as a " grab for power" by Canberra.

In reply to such allegations the Attorney-General is quoted as saying:

"Recognition in the constitution does not alter the fact that local governments are created by and are accountable to state governments. This is about saying yes to important community benefits from the partnership between federal and local spheres of government,'' . . .

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