A number of examples of duplication and overlap between the Commonwealth and the States were outlined in Chapter Three, including in the areas of health, education and housing.
A thorough reassessment of roles and responsibilities across levels of government is needed as a matter of urgency.
In determining ‘who should do what’ the Commission considers that two key principles should apply - subsidiarity and sovereignty.
Under the principle of subsidiarity, policy and service delivery should, as far as practicable, be devolved to the level of government closest to the people receiving the services. This recognises that sub-national governments are likely to have greater knowledge about the needs of citizens affected by their policies. It allows programmes to be tailored to meet community needs.
Governments should also operate at their natural levels. Policy oversight for national issues should go to the Commonwealth with responsibility for regional and local issues predominantly going to State and Territory governments.
Under the principle of sovereignty, as far as practicable, each level of government should be sovereign in its own sphere.
When reviewing roles and responsibilities, government activities should be allocated to one level of government where possible. This will provide greater clarity and accountability.
Any changes to roles and responsibilities should not result in major changes to the level of service currently provided to the public.
It will be essential that the States have a deep involvement in any review of roles and responsibilities. Most substantial reforms will require the Commonwealth and State governments to work together to determine who is the appropriate service provider. Having done that, an assessment can be made of the required level of funding. It would then be incumbent on governments to explain this to the broader public.
The Commission has identified a number of major Commonwealth spending areas, where it considers that there are near term opportunities to reduce overlapping responsibility and duplication. This is particularly the case for schools (Section 7.7), vocational education and training, housing, mental health and natural disaster relief funding (Section 8.6).
Recommendation 7: Reforming the Federation – clarifying roles and responsibilities
There is significant overlap between the activities of the Commonwealth and the States. The Commission recommends that a comprehensive review of the roles and responsibilities between the Commonwealth and State governments be undertaken, informed by:
- the principle of 'subsidiarity' so that policy and service delivery is as far as is practicable delivered by the level of government closest to the people receiving those services;
- ensuring that each level of government is sovereign in its own sphere; and
- ensuring minimal duplication between the Commonwealth and the States and, where overlap cannot be avoided, ensuring appropriate cooperation occurs at all times.