Back in 1969 when he was in opposition, Labor leader Gough Whitlam delivered a talk on reforming Australian federalism for the ABC’s Boyer Lecture series.
The federation, Whitlam opined, was an inefficient anachronism that prevented the formation of a truly national approach to policy.
The solution, he suggested, lay in abolishing the states, moving Australia to a unitary system of government, and enhancing regionally based local government.
When his party was finally elected to government in 1972, Mr Whitlam set about trying to achieve some of these objectives.
He couldn’t abolish the states, for that would have required a constitutional referendum to achieve and there was no way that Australians would vote to abolish their states.
Instead, Mr Whitlam used the Federal Government’s financial powers to try to enhance Canberra’s lead over policy.
During the brief tenure of his government, ‘tied grants’ allowed under Section 96 of the Australian constitution leapt from being 20 percent of total federal outlays to the states to be almost 50 percent. Australian public policy was awash with federal money.
There is an old adage that power is in the hands of those who control the purse strings, but Whitlam’s experience was that the states were not so easy to overcome notwithstanding Canberra’s financial power. For one thing, the Whitlam Government had a couple of premiers refuse to take up the programs being run from Canberra. Perhaps more perplexing for the Federal Government, however, was the difficulty the Canberra-based ministers and their departments had in trying to make sure that their programs were applied.
The lesson was soon learned that, while Canberra had financial power, the states had a monopoly over being able to administer programs on the ground.
Without the cooperation of the states, federal programs could very quickly flounder.
Today, the Labor leader who is threatening to have Canberra displace the states on a matter of major public policy – in this case, health – is Kevin Rudd.
Reeling from a disastrous two months where he and his colleagues underestimated new opposition leader Tony Abbott’s ability to recover support for the coalition as well as having to cope with the fall-out from the ‘roof insulation’ affair (and the far from competent attempt by minister Peter Garrett to defend himself), Labor appears to have hit the panic button.
With a general election imminent, Labor needed something big to restore its ascendancy in the policy debate. Promising a national education curriculum clearly was not enough.
An assault on the hospital system, and, through it, the state governments that run these systems, has thus become the policy centrepiece instead.
On the back of a feisty performance at the National Press Club to announce his government’s health policy, Mr Rudd brought back memories of Mr Whitlam. Like his predecessor, Rudd’s approach is one based on an implicit attack on the states.
By threatening to take over health funding, Rudd implies that the states have been channelling money meant for hospitals and health programs in to other areas.
The Rudd bombast will surely appeal to ordinary voters who have had an awful time at a public hospital, but there is nothing of any real substance to his plan other than trying to alter the administrative arrangements by which money is funnelled from tax-payers to the health sector.
As Victorian health minister Daniel Andrews has pointed out, there is no new funding associated with the Rudd health plan.
Mr Rudd has also decided a crash-through approach is warranted here. If the states don’t agree with his plan, the prime minister declared that he would seek the authority to override the states via a constitutional referendum.
Such a plan will surely fail, as Australians just don’t vote ‘yes’ in referendums, and, when this comes to pass, the Rudd health plan will have come to nought.
Instead of going back to Whitlam, Rudd ought to have learned from another Labor prime minister, Bob Hawke, who understood that major change can be achieved with the co-operation of the states if you’re prepared to do the consultative ground work first.
One of Rudd’s core problems is that his first term in government has been blighted by Peter Garrett and his department’s stewardship of the home insulation scheme.
With an election looming and a growing sense that his is an administration that doesn’t do anything other than stuff things up, Rudd has decided to run with a program to grab everybody’s attention.
An attack on the states always grabs attention, but, as Mr Whitlam found to his cost, actually succeeding in altering Australia’s federal system is another matter entirely.
Dr Nick Economou is Head of Politics at Monash University and a regular commentator on Australian politics.