Pro. Williams has raised the lid on a 'pandoras box'. One which any politician worth his super will not touch.

The idea of a summit certainly has merit, but who will be invited? Politicians, leaders of business, sporting heros, women, acedemics or journalists?

Although the 'founding fathers' gave us a constitution currect to the period, as Williams points out they could not forsee the future.

Ask anyone if they consider we are over-governed, my response would be a firm YES.

Here's an idea, lets have "Regional Entities", based on regional populations and geographic locations and do away with the states.

Unfortunatley that would mean the end of 'State of Origin' football!
Still we cant have everything, can we?

I entirely agree that the system needs a major overhaul. If we sat down now to design one that responded to current needs de novo we would end up with a completely different model.

Some principles we need to look at:

* We should only have one set of laws for this country - in an age where laws are being harmonised the length and breadth of Europe, it is crazy to have different laws in different parts of the same country. Individuals & organisations need to know that the rules are the same wherever they operate. Organisations that operate across state lines should not have to comply with 7 different privacy laws, for example. Laws are the fundamental groundrules of a society, and should be generic enough to be common to all parts of the Commonwealth.

* The Commonwealth Government has the bird's eye view and can see the big picture, but is remote from local communities. It is best suited to passing laws, devising policy frameworks, and running foreign affairs and defence.

* State governments are closer to local communities and may be best placed to supervise delivery of services, provided that they are given the funding.

The principles above imply that State governments should no longer be governments, of course. There would only be one Parliament, in Canberra, although there could be regional authorities, with elected assemblies.

Michael

The differential distribution of GST to the states has two elements. The first is the already mentioned wealth transfer function in response to the higher cost of delivering services to regional areas. And this would be fine if the city state that runs Queensland is actually forwarding those funds to the regions. They are clearly not doing so because the growth of the SE Corner places higher profile demands for greater intrastructure in that corner.

It is also clear, from the continuous complaints from the Sydney and Melbourne city states, that regional Victoria and Regional NSW are not getting any such funds because the urban elite are of the view that they have already paid enough to Qld, WA, SA & Tas.

The other element of this differential payment system was to compensate for the reverse multiplier effect on regional economies caused by the concentration of the head office portion of government outlays in the capital. It is the operation of this reverse multiplier from both federal and state outlays that is both the primary driver of rural decline and the primary driver of urban diseconomies like congestion and the multiplying complexity and cost of solutions.

These two major socio-economic issues will not be solved by an increase in centralisation. Indeed, it will exacerbate both.

The complaints from Sydney and Melbourne are well founded. They are funding the kind of new infrastructure projects in Brisbane that they are in urgent need of themselves.

The only effective solution to both problems is to create new regional states so both the contributors and the beneficiaries can be certain of both the integrity of the calculations and that the regional economies that actually suffer the reverse multiplier effect will receive the compensatory funds.

And with fully sovereign regional states, much of the other half of the differential funding requirement, the need to compensate for the tyranny of distance from the centre of governance, will be eliminated. And they will be free to merge their local government functions into the smaller state chamber along the lines of the ACT model.

The NSW, & VIC economies have been supported for over 60 years by Import duties paid by all the states to subsidies their manufacturing industries. Diminished as it may be, it is still critical for their survival.
They are still totally dependant on the foreign exchange earned by our export industries. Cut them adrift from the support of the other states, & they would sink like a stone.
They have to make some payment to us, for the continued use of us, as water wings.
Hasbeen

“Australia needs a summit on federalism.”

George, I absolutely agree.

There are strong indications that the near future of society as we know it is in real jeopardy, with peak oil approaching followed by other manifestations of a continuously increasing population living off a continuously less healthy resource base.

A major change in governance is needed. One of the biggest changes needs to be the divorcing of government from big business, so that government again reflects the feelings of the people, not the power and financial support of big corporations. It is essential that we develop a system of governance that actually looks out for our medium and long-term future instead of pandering to the profit motive, within three or six year timeframes.

We need a system whereby scientists and environmentalists can win political office, instead of almost entirely economists and lawyers.

.
I agree with Michael T; “We should only have one set of laws for this country”.

I support the notion of a 2-tiered governmental system, with the lower tier being somewhere in between the current state and local government level. I reckon it should be based loosely on population, as per electorates, but with each ‘province’ having perhaps in the order of 300 000 residents. This would give us nearly 70 provinces.

I don’t have a problem with the differential distribution of GST. The larger states should be contributing to the smaller ones, in a somewhat uneven manner. Anyway, how much national wealth has WA provided via iron ore and Qld via coal? We can’t possibly have completely even distribution of wealth / taxes anyway.

As for Perseus’ notion of “fully sovereign states” – sounds like an oxymoron. If they were fully sovereign, they’d be countries.

.
A summit of federalism has got to be one of the most important undertakings in our history. But how can we get it to happen. No political leader will touch it. And even if it did happen, what is there to stop those that hold the power now – big business and manic pro-expansionist politicians – from consolidating their positions?

Perseus, you wrote that "this would be fine if the city state that runs Queensland is actually forwarding those funds to the regions. They are clearly not doing so because the growth of the SE Corner places higher profile demands for greater intrastructure in that corner." In fact, the reverse is true. While perhaps 60-65% of Queensland's population live in SEQ, generally around two-thirds of infrastructure spending goes to non-SEQ regions. Most of this spending is not viable - the highest returns to infrastructure spending are in SEQ, and the present distribution is wealth-destroying.

In addition, Fred Argy - whose concern for the less well-off is well known - has argued that the economic linkages between Queensland regions and SEQ are such that building high-return infrastructure in SEQ (e.g. urban arterial roads, a second road from Brisbane to the Gold Coast) to help the SEQ economy would have a more positive effect on regional economies than giving them non-viable infrastructure projects. (By non-viable, I mean that the returns on the projects are less than their opportunity cost; in practice, e.g. Paradise Dam, the returns are often, probably mostly, negative.)

Reference: Fred Argy, P Hollingworth, M Lindfield & R Stimson, "Infrastructure and Economic Development," paper prepared for and ignored by Queensland's Department of State Development