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Legislative Council - Fifty-Second Parliament, First Session (52-1)
2011-05-17 Daily Xml
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CORPORATIONS (COMMONWEALTH POWERS) (TERMINATION DAY) AMENDMENT BILL

Second Reading

Adjourned debate on second reading.

(Continued from 3 May 2011.)

The Hon. S.G. WADE (16:01): On behalf of the opposition, I rise to support the Corporations (Commonwealth Powers) (Termination Day) Amendment Bill 2011. One of my colleagues suggested the name of the bill was more like the name of a blockbuster movie, but that is the sort of cultural discussion the Attorney-General and member for Bragg have in the other place, so I will leave that to them.

From January 1991, the commonwealth states and territories separately enacted uniform law to regulate corporations, generally referred to as the Corporations Law. Two High Court cases created uncertainty as to whether the commonwealth Corporations Law could be enforced—in particular, Wakim in 1999, and R v Hughes in 2000.

On 25 August 2000, the commonwealth state and territory ministers reached an in-principle agreement for the states to refer to the commonwealth parliament the power to enact the Corporations Law as a commonwealth law and to make amendments to that law subject to the terms of the corporations agreement. This referral is unusual in that it does not refer to specified legislative powers but refers to the state legislative power necessary to maintain a piece of legislation.

The states and territories chose to make a time-limited referral, rather than an ongoing one. The South Australian referral act, the Corporations (Commonwealth Powers) Act 2001, provides that the reference terminated on the fifth anniversary of its commencement. In that sense, the first referral terminated and was renewed in 2006, and the second referral lapses on 15 July 2011—a very short time away. The states and territories have considered this matter and reaffirmed their commitment to the limited referral approach. The amendment bill seeks to maintain the status quo by extending the referral of powers for a further five years—that is, to 15 July 2016.

I welcome the time-limited nature of the referral. It certainly suggests that there has been a considered, reflective approach by the states and territories, which I welcome. A limited referral may be a matter of trialling an approach. It may be that a referral is appropriate for a time and is no longer relevant in the future, and also a time-limited referral would be more likely to be revocable than an open-ended referral. I think that sort of considered, cautious approach is particularly important in the face of the centralising trends within the Australian Federation.

Through the expansion of its taxation powers at the expense of the states, the commonwealth has far greater fiscal resources, which it has used extensively to distort the federal balance. We have seen in federal Labor's bungling of service delivery programs, such as the Pink Batts and school building programs, that the commonwealth is often not well-placed to deliver services on the ground, particularly if they have a Labor government at the helm. We are seeing at the moment the federal government willing to raid state powers in relation to gambling regulation, as part of a desperate attempt to hang on to power federally.

These realities are a warning to the states to remain active to maintain a healthy federal balance. There is a bit of a view amongst the Canberra elite that federation is an anachronism. Our path to federation was indeed through the union of a group of British colonies, but the facts of the world today show that federalism is not merely an historical accident.

While only 24 of the world's 193 countries have federal political systems, federations host 40 per cent of the world's population. The fact that eight of the 10 world's largest countries by area are governed by federations, including Australia, highlights the relevance of federal structures to geographically diverse nations. Historically, it is true that most federations developed where previously separate entities came together to form a federal government; we think of the United States colonies, the Swiss cantons and the Australian colonies.

The constituent entities normally keep some powers, but others are transferred to the federal government. But more recently, we are seeing significant developments in previously unitary countries which are adopting federal structures. They often do so as a way to maintain a common central government whilst also empowering regional self-determination; we think of countries such as Spain, Belgium and South Africa.

Federalism allows the recognition of both diversity and common interests, including geographic diffusion. In fact, some of these countries, although in relatively recent experiments, are progressing federal models more creative than the traditional federal model. I am thinking particularly there of Belgium. It was founded as a centralised state, based on the French model, but in recent decades (I understand, since the 1970s), they have developed a federal state, but more recent developments see Belgium taking on elements of the confederation.

Even Australia's mother country, the United Kingdom, if you like, one of the bastions of unitary governments, is moving towards federation. In recent years, national assemblies, such as those in Scotland, Wales and Northern Ireland, have taken on significant governmental responsibilities. Whilst one should not refer to an entity such as the European Union as a federation (it is a supranational organisation), in terms of its political operations, some observers note that, after 50 years of institutional evolution, the European Union does possess some attributes of a federal state.

I make the point that my party and I are federalists; our party is federalist by its constitution. We do not see federations as merely a colonial anachronism; they can be just as relevant to meeting the challenges of the modern world. In that context, I pay respect to the Attorney-General, who I do accept as a sincere federalist. He does see the relevance of a federal system to Australia moving forward, and I hope to see that reflected in the policies and legislation he brings before this house.

I also acknowledge that premier Rann was involved in the formation of the Council of Australian Federations, a body which claimed to be seeking to communicate to the Australian community the relevance of federation to Australia moving forward, but I note that the Council of Australian Federation seemed to be a greater priority for the Rann Labor government when all the states were Labor and the federal government was Liberal. I noticed that the council's website suggested that there has not been a meeting of the council since November 2009.

I certainly believe that, within the Australian political community, we need to have constructive forward-looking dialogue on shaping a contemporary federation. I acknowledge that this bill is an example of a model that we can use to constructively engage with other states and territories and the commonwealth, and I indicate the opposition supports this legislation.

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