MICHAEL KEATING. National Cabinet to replace COAG: Part 1 of 2.

Scott Morrison has decreed that “COAG is no more” and will be replaced by his new National Cabinet. Part 1 of this article below, discusses the reasons for the initial success of both the National Cabinet and COAG.

Part 2 tomorrow will discuss the chances of the new arrangements proving to be more successful than the recent experience with COAG and its ministerial committees.

Scott Morrison has had a very successful last few months. Gone are the bad memories of his failure to provide leadership during the bushfires in December and January. Instead, Morrison can deservedly take much of the credit for Australia’s outstanding successful response to the coronavirus epidemic.

A key element in achieving that success was the establishment of the National Cabinet. This meeting of Australian, State and Territory leaders was able to quickly agree on the health response. Their agreement on the key features of this response was vital for gaining the public support for what were potentially controversial policies as far as the economy and public liberty were concerned.

Now building on that success, Morrison has proposed that the National Cabinet should supplant the Council of Australian Governments (COAG), the previous peak body for Commonwealth-State negotiations, which will now be scrapped.

But what difference will this change in name make? After all, the membership has not changed at all, and while the supporting machinery is a bit different, will it work any better?

Why was national cabinet successful?

In my opinion, the key to the national cabinet’s success, so far, is that it has only been dealing with a single issue, and an issue which represented a common challenge. In addition, expert advice played a crucial role in determining the fundamentals of the health response, and there was no significant disagreement.

Certainly, there were no philosophical differences between the members and ideology played no part in their deliberations, with the Liberal and Labor Premiers of NSW and Victoria, respectively, often forming a common front. In addition, the States were able to exercise their own discretion regarding the detailed implementation of the health response consistent with the criteria laid out in the common agreed framework.

In short, it was relatively easy to achieve agreement on the health response, and there was mutual strength in all “hanging together”. While the economic response, which greatly ameliorated the disruptive effects of the health response, was largely determined and paid for by the Commonwealth government acting on its own.

The comparison with COAG

Interestingly, when COAG was first instituted it too was successful in much the same way as the national cabinet has been recently, and for much the same reasons.

The first issues on the original COAG agenda were native title and competition policy, and both were matters of state jurisdiction. However, a national response to the High Court decision on the Mabo case was unavoidable (like the need to respond to the coronavirus). This decision, while recognising the possibility of native title having been preserved in some regions, left the status of many property titles indeterminate, and provided no guidance on how native title should be determined nor how it would work thereafter.

The introduction of competition policy also mainly impacted state responsibilities – their utilities – but again there was considerable pressure for this change. It was seen as a key part of a widely supported program of national microeconomic reform and it was also greatly assisted by a major expert report – the Hilmer Review.

COAG met multiple times a year to discuss these initial reform projects and both were centrally driven. In particular, Paul Keating, as Prime Minister, played the key role in establishing the conditions for recognition of native title. But much of the supporting detail was developed by a specialist task force located in the Prime Minister’s Department, with expert membership drawn from several other departments, and consulting intensively with indigenous representatives and the states. Similarly, a group of senior officials from the Prime Minister’s Department and Premier’s Departments developed the details of national competition policy within the agreed framework laid out in the Hilmer Report.

There was also work on rationalising various government services to improve their effectiveness. Again, this work was centrally driven though the key officials’ meetings of Heads of Premier’s Departments and the Prime Minister’s Department were joined by experts from the relevant line agencies.

Some progress was made, particularly in health, where new ways of funding and servicing the needs of chronically ill patients – about half of all health expenditure – were explored. However, it quickly became apparent, following the 1996 election, that the new Howard Government’s priorities lay elsewhere, and the work on major spending programs jointly funded by the Commonwealth and the states was largely passed back to ministerial councils, where the responsible ministers were serviced and advised by their officials. Ironically, this seems to be the feature of COAG which has most annoyed the Prime Minister and which he now describes as overly bureaucratic.

Looking back on the experience of the first few years of COAG, however, I think it can fairly be said that the outcomes achieved for both native title and competition policy were successful. On these initial issues COAG demonstrated the same commitment to achieving agreed policy outcomes as National Cabinet and succeeded in much the same way and for much the same reasons.

But this success depends upon COAG getting engaged in determining the required policy changes, with strong leadership from the Prime Minister. He must have a clear idea of what he wants to achieve and then be able to build a consensus around that objective. That was easy with the health response to the coronavirus, where all governments have been pretty much agreed that they needed to act hard and early if they were going to suppress the virus. Paul Keating had a more difficult task thirty years ago, but again he was able to provide that leadership and obtain the agreement that made COAG work.

But for the future, is Scotty from marketing capable of providing that leadership that drives a policy agenda? To date, all he has done is to ordain that the National Cabinet “will be different to the way that COAG worked … it will be driven by a singular agenda, and that is to create jobs”. “It will drive the reform process between state and federal cooperation to drive jobs.”

But what does that mean? What practical guidance does a single focus on jobs provide to each of the different ministerial councils, or is this just another marketing slogan from Scotty masquerading as a policy?

In Part 2 of this article tomorrow I will consider the chances of success under the new arrangements that Morrison has now instituted, having regard to the issues that are on the agenda.

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Michael Keating is a former Secretary of the Departments of Prime Minister and Cabinet, Finance and Employment, and Industrial Relations.  He is presently a visiting fellow at the Australian National University. 

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