Commonwealth and states, 1901-1910 : a study of the executive and administrative relations of the seven governments of Australia in the first decade of the federal system

Abstract

The birth of the Commonwealth of Australia, on 1 January 1901, added a new Government to the six already existing within the continent. The new Government had jurisdiction over the whole of the territory occupied by the six established Governments and removed, either at once or after an interval, some of the powers which they had previously exercised. Yet the Constitution did not set out to establish a hierarchy of Governments beneath the Imperial Government. The Commonwealth and State Governments were to be independent and equal within their own spheres. It is the working out of this plan for coordinate federalism, during the first decade of its operation, which is studied here. The seven Governments are observed as they learn to live together in their new constitutional relationship. Even before federation was a fully accomplished fact, dispute arose over the right of the States to communicate directly, through their Governors, with the Secretary of State for Colonies. This dispute had several aspects. The States retained the right of unsupervised communication in general matters, except where they involved federal interests, when copies of despatches were to be sent to the Governor-General. In 1902-3, it was ruled, by the Secretary of State, that all communications concerning external relations should pass through the Governor-General, since, with regard to foreign nations, Australia was said to have become a single political entity. This was not altogether in line with Australian thinking at the time and, while the theory was re-affirmed several, times, it proved difficult to insist on it in practice and some tacit withdrawals were in fact made. In matters of imperial affairs, the States were able to maintain only in part their right of direct communication. The failure of the States to maintain fully this right of direct communication led to some loss of political status and did much to place them in a position inferior to that of the Commonwealth. The long and bitter feud between New South Wales and the Commonwealth over the capital site sprang largely from the old rivalry between New South Wales and Victoria. It raised no vital issues, but, because the State chose to regard it as the touchstone by which the working of the federal system must be judged, the question did much to poison relations generally between the two Governments until it was finally settled. The dispute between South Australia and the Commonwealth over the transfer of the Northern Territory illustrates the difficulties which arise when a nascent sense of national responsibility clashes head on with parochial self-interest. Sometimes, problems which were quite small in themselves become magnified in the prevailing atmosphere of the times. The determination to expel the Kanakas, as part of the ’White Australia’ policy, caused bitter resentment at the beginning because of its effect on sectional interests in Queensland and its unfortunate co-incidence with a period of economic depression due to drought. Better conditions, Commonwealth assistance, and a change of State Government to one more in harmony with national sentiment led to co-operation over the actual, expulsion. This question provided an opportunity to test the right of the Commonwealth Parliament to act independently of the State in a matter which, although it affected the interests of a State, fell within the ambit of Commonwealth powers. The field of encouragement of immigration illustrates the difficulty of getting co-operation in matters of national importance when they are subject to divided control. The dispute over the provision of a second residence (in Sydney) for the Governor-General and over the payment of his fares on the State railways sprang largely from the failure to satisfy the aspirations of New South Wales over the capital site and demonstrated the need for making intergovernmental agreements clear and definite. In many matters of day to day administration the seven Governments co-operated readily and shared facilities. This was what made the new system work. Co-operation became more difficult as the attempt was made to move from specific acts towards more general administrative integration. The States feared the possible surrender of powers not committed to the Commonwealth by the Constitution. While there were some problems associated with the transfer of departments , the general attitude was helpful. The transfer of property, which raised problems of definition, and of the payment of compensation, was less harmonious, partly because of the financial questions raised. Although the Constitution forbad the taxing of each other1s property or agents by either Commonwealth or State Governments it was still necessary to determine when an officer was acting as the agent of his Government and when a tax was being imposed on property. The High Court complicated the issues by importing, unnecessarily, the American doctrine of implications from the nature of federalism. Conflict between the High Court and the Privy Council led to doubt being cast on the right of the former to be the final arbiter of the Constitution in inter se questions. The States lost legal status both because they were not exempted from the payment of customs duties on their own imports and because they retained the power to tax Commonwealth officers, members of Parliament and Ministers only by the grace of the Commonwealth and not by right. Financially, the Constitution secured the States adequately for the first decade and then left them at the mercy of the Commonwealth Parliament. In spite of this, they attempted consistently to dictate terms to the Commonwealth, which was almost always ready to discuss the question with them. As the Commonwealth used more of the powers committed to it, its needs became greater and it served notice in 1908 (by the Surplus Revenue Act) that the States must expect a smaller return when section 87 of the Constitution ceased to be obligatory. The interim solution of I9IO left the States (which had rejected earlier, more favourable, offers) in a position of financial dependence. By the end of the first decade it was becoming clear that the power of the Commonwealth was likely to continue to grow and that of the States to decline. They had not been able to maintain the equal and independent status given them by the Constitution. Politically, legally and financially, they were already finding it difficult to keep pace with the Commonwealth. Initially, the power of the Commonwealth was strongly resented, but by the end of the decade it had to be accepted. The strange mixture of co-operation and of dogged opposition reflected the forces which caused federation, a compromise between unity and disunity, to be chosen as the system of government most acceptable to the Australian Colonies. Show more