Wrong way, go back

THE Howard Government is going down a centralising route which is not only poor policy but poor politics.

Over the past month the Government has announced decisions to nationalise the industrial relations system, to establish a national year 12 exam, to nationalise the universities;  and to establish national TAFE colleges.  It has also publicly considered the idea of taking over public hospitals.

While frustration with the actions of the states on all these fronts is understandable, the aim should be to use the influence of the Commonwealth to get the states to improve their service delivery rather than taking these service over.

While our federal system has many faults, it has many benefits.  Firstly it does allow policies to be more closely tailored to the needs of local concerns.  For example, West Australian industrial regulation in response to the needs of its remote mining industry allowed more intense working hours, long before they were allowed for in federal awards.  The fact is Australia is a large and economically and geographically diverse continent and needs policy tailored to these differences.

Second, federalism allows experimentation.  The Kennett Government was, because of the dismal outlook of the state economy, able to push the policy frontiers and experiment with a raft of reforms that were not politically possible elsewhere.  Most of the experiments were successful and were subsequently adopted to some degree by other states and the Commonwealth.

Third, the federal system can act as an insurance against government failure.  That is it allows the nation to avoid putting all its eggs in one basket.

This is particularly relevant too for industrial relations.  The Howard Government is likely to put in place a far better IR system than currently exists in the states.  Eventually, however, the ALP will regain power federally and, judging from the union-dictated IR policy it brought to the last election, they are likely to wind back these changes.  And if the Howard plans are carried out, there will be no state alternative on which to fall back.

Fourth, federalism can give rise to constructive competition between the states.  Also, the fact is the Commonwealth bureaucracy has no expertise at service delivery.  It should act like a head office of a large firm.  Which is to set measurable goals, preferably with the agreement of the states, ensure that these goals are monitored effectively, provide incentives to meet these goals and report on the achievement to the public.

Such an approach would not only improve the operation of government but would be politically much safer and be consistent with the constitution.

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