Opinion & Commentary
Dismantling federalism, one hospital at a time
The Federal Government's takeover of Tasmania's Mersey Hospital has attracted some of the criticism it deserves, but has also been explained away by some commentators in a ''boys-will-be- boys'' view of politicians at play a few months before an election. This lets the Government off far too lightly. Whether or not its action turns out to be clever politics in the short term, it is also a piece of public policy, and a particularly bad one. As Treasurer Peter Costello keeps telling us, if you get the policy right the politics will follow. At one level, the Mersey action smacks of fiscal recklessness, but it is hardly the first piece of evidence that the Government has too much money to throw around. More interesting is what it says about the Howard Government's attitude to our federal structure of government.
Australian government has been growing more centralised ever since the ink was dry on the Constitution, but the present Government has become increasingly open and frontal in its use of the Commonwealth's fiscal firepower to undermine federalism. The Mersey action is the latest in a long stream of centralising policies, but for the first time the Government's explanation has brought out the Howard doctrine of federalism. The Howard doctrine holds that: ordinary people don't care which level of government provides a service that they value, as long as it is delivered; and if one level of government fails in its responsibilities, the remedy is for a higher level of government to step in.
Taken literally, the Howard doctrine opens up a vast range of possibilities, ultimately limited only by the High Court's interpretation of the Constitution. How about federal intervention in Sydney's public transport, for example? It may be true in specific cases, such as the Mersey Hospital, that the people directly affected do not care who provides the service. But since when has pandering to populist sentiment amounted to a sound basis for policy? Had populism prevailed, none of the economic reforms that have delivered broad benefits over the past 20 years would have happened.
Despite the populist sentiment in the Mersey case, on a broader canvas people understand that government according to a set of principles is better than an anything-goes approach. One of the pesky little principles of federalism that the Prime Minister has brushed aside is accountability. For the federal system to work it has to be clear which level of government is responsible for what under a rational allocation of roles and responsibilities to Federal, state and local government. Voters need to know who to hold accountable for service delivery. Policies such as the Mersey intervention only serve to obscure accountability.
Another of those pesky little principles is called subsidiarity each function of government should be assigned to the lowest level at which it can effectively be carried out. It doesn't make sense for defence or external affairs to be the responsibility of local government, any more than it makes sense for the Federal Government to be respon- sible for street lights and footpaths. You will get a better street light service, more consistent with the needs of your local community, if it is arranged by your local government rather than by the Commonwealth.
Likewise, the Tasmanian Government ultimately knows best how to respond to the hospital needs of its residents. That doesn't mean that it can't fail at times just as the Federal Government can fail in its responsibilities but the remedy is through the ballot box or giving the state's greater fiscal autonomy, not federal intervention. The Prime Minister knows that his policies are inconsistent with the principles of federalism but doesn't care. That doesn't mean the rest of us shouldn't care. Australia, like the US, Canada, Germany, Switzerland and a host of other countries, has a federal system because it was believed to be better for us than a unitary system.
A federal system provides checks and balances against excesses of government power, and allows greater diversity and policy responsiveness. There are also costs in a federal system. It is open to debate just where the balance lies between the costs and benefits. Perhaps the states are an anachronism and government needs to be more centralised. But we should not be moving there through ad hocery, dismantling federalism one hospital at a time. Let's have the debate.
Robert Carling is a Senior Fellow at The Centre for Independent Studies.
