Federalism does not need an ongoing ‘National Cabinet’

Jul 19, 2020

Australia has so far been successful in its response to the COVID 19 pandemic, a major reason being the constructive role of the ‘National Cabinet’. But there is good reason to be highly sceptical about the ongoing role for the ‘National Cabinet’ announced by the Prime Minister.

The very term, ‘National Cabinet’, disguises the nature of federalism: that each jurisdiction has sovereign powers. The term, ‘Council of Australian Governments’, was a much better reflection of Constitutional reality.

There is also good reason to be sceptical about the Morrison Government’s understanding of good cabinet practice within its own jurisdiction.

What is good cabinet government?

There are two key objectives of cabinet government in Westminster systems: policy coherence and political support. While there are any number of ways cabinet can work, some practices have emerged that make more likely the achievement of those two fundamental purposes. These include acceptance of ‘collective responsibility’ where all members of cabinet accept and defend the decisions of the group, confidentiality over discussions within the cabinet, and the access cabinet has to different perspectives on the issues at hand and to quality information and analysis.

These practices can be reinforced by the structure and membership of the cabinet and the related structure of government administration (the Administrative Arrangements Order or AAO).

The AAO that came into effect in February has not enhanced the cabinet process – there has been no corresponding restructuring of the ministry, and no clarification of the policy priorities the restructuring is meant to reflect that might enhance policy coherence.

The contrast with the original introduction of mega-departments in 1987 is telling. The 1987 restructuring was clearly directed towards enhancing cabinet government. Every department was represented in the cabinet, but the cabinet size was kept manageable. Each portfolio minister had assistant ministers and/or parliamentary secretaries; these ministerial teams were allowed some discretion over resource allocation and policy ensuring cabinet business was not overloaded. The restructuring also reflected well understood policy priorities and agendas: for example, reform of transport and communications GBEs, linking education more closely to employment outcomes, better integrating health and community services.

Under the Morrison arrangements, there are 23 cabinet ministers; many departments have multiple ministers in cabinet and no clear portfolio minister; many ministers have responsibilities that cross departmental lines. The Department of Infrastructure, Transport, Regional Development and Communications has eight ministers, four in cabinet and four with responsibilities for functions in other departments. The lack of alignment between the ministry and the AAO means there is no discipline about how different perspectives are brought to bear with proper supporting information and analysis, and no clear process for portfolio decision-making; there is also no clear policy agenda.

It seems cabinet is at best a forum for political discussion (on anything and everything) aimed to ensure political support, but not a forum for policy cohesion.

Federal decision-making structures

The need for cross-jurisdictional decision-making has increased over the last five decades as the Commonwealth’s interests have continued to increase, widening the range of shared responsibilities. The process requires both vertical and horizontal coordination – between the different levels of government and across central and line ministries. The central forums for vertical collaboration need to relate to the line ministry forums (and vice versa), and each line ministry forum has its own vertical framework.

The two dimensions must also operate in conjunction with each jurisdiction’s own cabinet, and each one’s own legislature.

By its very nature this is a more complex process than a single jurisdiction’s cabinet process. Some people may pine for a return to coordinate federalism with clear delineation of respective responsibilities and few shared ones, but those days are long gone and will not return.

Achieving results from this process requires good leadership. A prime minister with a clear agenda who can gain the support of key premiers is essential. It is also much easier when there is just one priority issue (or two) – COVID 19 in 2020, Mabo and competition policy in the early 1990s. Having the advice of experts is also essential –from  the AHPPC this year and from the Hilmer Report in 1992, along with a particularly able group of senior officials and a specialist task force on Mabo.

Even where there is such a focus, there is also, always, ongoing matters to be addressed in each area of shared responsibility. Some politicians might find this bureaucratic, but it is a necessary part of making our federal system work. This ongoing work is also often essential to the expert advice the central leaders (National Cabinet or COAG) need when addressing their particular priorities. The AHPPC worked for more than a decade on how best to respond to a pandemic drawing on lessons from SARS; that work in turn built upon earlier work by the Australian Health Ministers Advisory Committee and its specialist committees, authorised by the Australian Health Ministers Council.

Morrison may want the ‘National Cabinet’ to focus on jobs, but the ongoing business of cooperative federalism requires attention to many other issues in order to ensure effective and efficient delivery of quality services whether in health, education, housing, the environment or transport and infrastructure.

Much of this ongoing business must be carried out by the line ministerial councils and their officials’ forums, assisted by external experts and stakeholders. There is a case for limiting the number of councils, but Morrison’s own strange ministry means it is unclear which minister should attend which council and which will lead the Commonwealth position.

The idea that the Treasurers, meeting as the Council of Federal Financial Relations (CFFR), can take full responsibility for all funding agreements as Morrison proposes, is simplistic. Agreements do need to be signed off by the National Cabinet or COAG (as has just occurred re the 2020-2025 National Health Reform Agreement) after consideration by Treasurers and Finance ministers. But, if they are to advance the quality and effectiveness of service delivery, they need to be designed by the relevant line ministers and their advisers.

I recall when I was Secretary of the Commonwealth Health Department in the late 1990s the firm advice from my minister, Michael Wooldridge, both to me and to his health ministerial colleagues, of the need for us to work hard on the health reform agenda at least 12 months in advance of the next scheduled agreement in order to be on the front foot when first ministers and Treasurers and Finance ministers inevitably took over the process. Their interest would be almost exclusively on the money, not health reform. He was right. (Wooldridge gave me similar advice about the need for the portfolio to be in the lead on the Commonwealth’s own health reform, reminding me of the disasters of Malcolm Fraser’s Medibank ‘reforms’ led by PM&C, about which he had written a thesis.)

Federalism reform

Morrison’s announcement referred also to a ‘National Federation Reform Council’ comprising the National Cabinet, the CFFR and the Australian Local Government Association which is to meet once a year to focus on priority national federation issues. The aim is to ‘streamline processes and avoid endless meetings that do not result in action’. It is ‘a congestion busting process’.

There is no longer-term reform agenda behind this rhetoric, nor any structure like the COAG Reform Council established under Howard in 2006 and expanded under Rudd to provide an independent focus on performance and outcomes (it was later abolished by Abbott). Perhaps Morrison will allow the States to play a greater role in setting the agenda, something that has long been needed, but he has yet to say so.

As revealed by the public service changes announced in December, and the instructions to secretaries last May, Morrison’s approach is fundamentally transactional. Prime ministers do need to respond to events as they occur and to gain the necessary political support; but for Morrison this seems his only interest, to the exclusion of longer-term policy reform and policy cohesion.

This is clear once again in his superficial approach to federalism reform.

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