From these historical relationships between the federal system and Australian regionalism, we can draw five key lessons about future approaches to the development of Australia’s system of governance.
First, we must recognise that we have undervalued the idea of general-purpose government at local and regional levels, as an element of our national governance strategies. Whether we approach the quest for improved on-ground outcomes through the prism of collaborative federalism, or capacity-building in local government, or improved regional governance, we have to make active choices about whether – or how – we intend to strengthen local and/or regional governance as a sustainable constitutional player in the medium to long-term. Devolution in federal and state responsibilities is unlikely to be effective, or enduring, without dealing with the issue of general-purpose government capacity at local and regional levels to carry the burden, in a manner that is democratically accountable. Regional institutions cannot be further developed without a constructive debate about their political legitimacy, including dealing with the political reality of existing local government. The opportunities for meaningful reform are limited unless the strengthening of local and regional governance is accompanied by a strengthening of local and regional democracy.
A second key lesson is that while the current reform environment holds positive opportunities for a new reconciliation of federalism and regionalism, it is not currently fashionable to build governance capacity by enlarging the size of the public sector, at any level. This is implicit in recent theories of ‘governance’ as approaches to societal decision-making in which governments steer, but no longer necessarily row; and in which a range of networked policy actors take responsibility for policy formulation and on-ground action – including privatised, contracting and not-for-profit organisations, as well as interest and community groups (see Weller 2000). Despite the appearance of being a large, cumbersome system, comparative analysis suggests that federalism can help deliver government that is relatively small (Twomey and Withers 2007). Just as importantly, these arguments accompany a period in which Australian governments have withdrawn from direct public investment in economic development, and tend to prefer to let the market decide, as demonstrated by Andrew Beer’s chapter. These trends raise important challenges for the task of strengthening local and regional capacity. Even if governance is now about partnerships, the facilities needed to develop and sustain effective partnerships are coming off an extremely low base. In short, if national and state governments intend to continue to put more back on to the community and onto business to ‘do it itself’, then without investment in some greater local-level governmental infrastructure to support this, the risks of policy failure are probably increasing rather than being reduced.
A third key lesson is the need for more productive debate about the problems and solutions inherent in the current federal system, both among experts and at a community level. As Gray and Brown (this volume) demonstrate, it is relatively easy to find evidence that citizens have problems with the existing system. It is more complex to identify the basis for differing views, and to reconcile these with historical experiences and institutional design principles in order to identify potential common ground for reform. There is every reason to be positive about the potential gains from reform of the federal system, to deliver more effective and responsive government both nationally and at the local and regional levels – and yet many of the arguments for reform continue to be presented negatively, as ‘whinges’ about the inadequacy of particular existing institutions. Painting federal governments as centralist, totalitarian or opportunistic ‘monsters’ does a disservice to many efforts of federal legislators and administrators to secure practical improvement in policy outcomes. It is similarly pointless to blame the State government of the day for ‘ignoring the regions’, as if today’s legislators and administrators should take moral responsibility for the complex history that has left most state government operating at such problematic scales. In the survey described in Gray and Brown (this volume), two-thirds of the NSW State government employees captured within the respondent group expressed a preference for a scenario consistent with abolition of State government. If state government employees are indeed as cognisant as this of the potential merits of change, it makes little sense to hold them culpable for their own current predicament. Similarly, at a larger level, it makes little sense for reform advocates to campaign for the abandonment of federalism in principle when, plainly, the opportunities for improvement in our system of governance relate less to whether the system is federal or unitary in nature, than how our federal experience has panned out in practice. There are strong reasons why federalism makes sense as a constitutional system for Australia, even if there are also strong reasons why that system should evolve, either incrementally or dramatically.
Fourth, the key to a more productive debate may lie in the better alignment of thinking about short, medium and long-term approaches to reform. The last 20 years, in particular, have seen reform options approached competitively – in other words, if a short-term solution or ‘quick fix’ is presented, it tends to be grabbed as an alternative to investigating longer-term reform, and the potential gains from longer-term reform consequently dismissed altogether. This has tended to be true even when it makes sense to consider both, or to at least make short-term decisions in the context of an identified longer-term direction. Equally, the experience with collaborative federalism in the 1990s tends to indicate that even when something works, we are slow to consider mechanisms to institutionalise or constitutionalise the advance. Even when dramatic, the coercive use of federal legislative powers to reshape federalism, such as in the WorkChoices decision, may open up as many questions as it answers about the medium and long-term evolution of the system – after all, contrary to the government advertising that preceded it, the massive expansion of the Commonwealth industrial relations system nevertheless still leaves state industrial tribunals in place.
Similar considerations apply when considering the future of local and regional governance within the federal system. Despite being pursued as alternatives to long-term reform, the challenges encountered by many short-term initiatives simply increase the case for better thought-out, sustainable institutional investment. The more federal and state governments collaborate on the design and delivery of programs, the greater their need to also agree on how communities are to be engaged in the design, and how the delivery will be achieved, measured and monitored at the local level. Without agreement on this local-level engagement and delivery, all the political triggers remain for the collaboration to fail – for example, for dissatisfied regional communities to again take their issues directly to the federal level, and campaign for alternative programs or new interventions to correct poor implementation by state governments. This dynamic, as much as any fixation with power for power’s sake, appears to explain much of the growth of federal intervention in many local and regional issues. To break this cycle, short-term program objectives and longer-term institutional development need to be pursued hand-in-hand. In other words, wherever it is acknowledged that design or delivery of programs will rely on action at lower local or regional levels, then initiatives in whole-of-government collaboration need to be supported by whole-of-government commitment to optimal devolution of responsibility to that level – even if this means substantial development in the capacity and direct accountability of regional frameworks. Without it, assuming the program is substantially delivered, there is little to prevent the inevitable conflicts over outcomes and performance from reinfecting federal-state relations, and jeopardising further collaboration.
On a positive note, the fifth and final lesson from this background is that the 21st century political landscape does appear to hold improved prospects for a productive approach – including a heightened capacity to make more informed short-term choices. There is little complacency about current arrangements, at any level of government. Instead there is widespread consensus that it is worth considering almost anything, if it can help contribute to more effective, responsive, adaptive and efficient governance. Many of the ideologies that dichotomised political debate over the size, role and structure of government in the 20th century have disappeared. So too have the more parochial ‘states’ rights’ perspectives that once helped ensure that any constitutional debate was likely to degenerate immediately into a federal-state stand-off – it is difficult to imagine a state premier ever again telling Japanese hosts that he is ‘not from Australia, but from Queensland’, as Joh Bjelke-Petersen is once reputed to have done. On questions of regional institution-building, the destructive ideological deadlock of the Cold War era has long since receded, in which social progressives tended to fear new state ideas as an agenda of rural fascists, and conservatives opposed alternative regional or provincial bodies as some kind of centralised, urban Communist plot.
Instead, we have an environment in which all political parties tend to have equally minimalist commitments to any kind of constitutional development, and the focus is a pragmatic one, on simply making the existing system of government work better. While this scarcely sounds visionary, when the unproductive nature of past debates over regional devolution are considered, this new ‘year zero’ of thinking about federalism is, in fact, a safe place to start. If we get the next phase of federal reform wrong – for example, if the under-capacity of local and regional governance are not addressed, and ‘subsidiarity’ principles remain simply a rhetorical device in the tussles between national and state governments – then history is likely to lead us back to where we already are or have been. If we get it right, and find new ways to develop the practical machinery of federalism to recognise, empower and utilise local and regional action, we will not only have achieved a theoretical resolution of the relationship between federalism and regionalism in Australia; we will also have moved towards more durable solutions to some of the pressing policy challenges and problems set out in this book, in which we already know local and regional action to be vital. Whether strong or weak, transient or a symptom of something longer term, regionalism is alive and well in Australia today, and it matters in both political and public policy terms. As new national approaches unfold in most major policy areas, more and more we recognise these are unlikely to work without also growing the capacity of local and regional governance.
This chapter concludes with a picture from the cover of The New State Magazine of 1922 (Figure 2.5). This is not because the option of new state governments represents a solution to everything, but because the image helps reinforce the depth of our own historical capacity to think about these issues. While the map shows an alternative political structure for Australia, the magazine as a whole carries the motto ‘For a Bigger Australia’. It may be that it is not actually practical to create a bigger Australia, but the reform of federalism is certainly motivated by a vision of a better Australia, and this remains the outcome we should expect from more informed, research-based policy and political discussion about the development of our institutions in the long term.
Source: Thompson (1922)