Under the proposed Foreign Relations Bill the states might be down but they are not out

Sep 1, 2020

If Mr Morrison wants to ride roughshod over certain state interests in the external sphere he had better be prepared to brief counsel at the High Court.

The Coalition’s proposed Foreign Relations Bill will put a wet blanket over non-government organisations, local councils, universities and cultural groups with arrangements in China, and may be prejudicial to mutual trust. But it will not succeed in putting the states in their boxes to the extent the government might intend.

The government announced last week that it would introduce a Foreign Relations Bill to monitor the overseas dealings of the state governments, councils, the universities, and all and sundry that do not conform with the government’s foreign policy. It denies that the measure is directed at China but it is blindingly obvious that it is.

What has brought this about? Although this type of legislation may have been in the government’s war chest for some time its emergence now is well timed politically.

First, the government has been frustrated by the states’ Covid-19-related border closures, with the government showing itself incompetent to use the option available to it under Section 92 of the Constitution.

Second, the government is pulling rank over the states by utilising the External Affairs power. The trigger here, of course, is its long-running ambivalence towards Victorian Premier Dan Andrews’ Memorandum of Understanding with China in relation to China’s Belt and Road Initiative (BRI), now seen as a strategic program for China to spreads its influence throughout the Asia-Pacific region and beyond. However, an MoU is not a treaty but an informal understanding.

Is the Bill necessary? Some have said it is because of “cracks and seams” in the federal structure which China, in particular, is exploiting. But it seems there were no cracks in the federal system when the Coalition government admitted the Chinese to the Port of Darwin. What is now occurring that the government seeks to keep out?

Premier Andrews involvement with the BRI was initially welcomed by the Prime Minister, the Minister for Foreign Affairs and the Minister for Trade, persuaded presumably by the premier’s keenness to promote Victorian trade and investment at home and abroad. There had been no serious question that the Premier was overreaching himself in the international arena.

Since then, of course, Chinese belligerency has turned a corner. Morrison and Andrews have turned on each other and issues affecting the Federation are looming.

Moreover, the bill comes on the eve of the tabling of a report from the Parliamentary Joint Intelligence Committee, raising the political temperature over national security. The report will contain a strong message for both China and two arms of the Labor Party – the federal Opposition Leader (expected to wave it through), and Premier Andrews, who can be expected to give it short shrift.

The Bill, once law, will have serious implications for all manner of organisations, cultural groups, twin towns, as well as scientific bodies and universities. The implication is that their activities facilitate Chinese penetration of sensitive areas of Australian life, including theft of intellectual property, undue influence, and espionage in one form or another.

Nothing could be more calculated to make Australians uneasy when they have previously been told to promote these relationships, build cooperation, and foster mutual understanding. Now anyone with a deep interest in China may believe they are under suspicion.

Under the proposed law, ASIO and ASIS, armed with 80 pieces of recent security legislation, and with the assistance of DFAT will monitor the hundreds of arrangements entered into; though doubtless the security agencies will have their eyes on specific ones of political interest.

A 1950s image of furtive grey figures in dark doorways, with ASIO at their back, comes to mind. Or might it be a Stasi? We are not in a Cold War although it appears that is the government’s objective. How indeed could we, having already granted the Chinese access to the Port of Darwin?

Recalling past direct dealings of premiers such as Henry Bolte, Charles Court and Don Dunstan with foreign states, we could guess how they might have responded if faced with this Bill. Not even in Cold War days was this issue raised.

More recently we can recall the large trade missions to India and China led by then Victorian premier Ted Baillieu. And the role of then WA premier Colin Barnett in opening up Australia’s iron ore trade with China while federal governments faltered.

But let’s not lose sight of what the Morrison Government wants to achieve with this legislation, which is to put the states in their boxes and control all their external operations. Yet the states are already well established in this regard with official offices in the UK, Europe, the US, Japan and Korea, to name a few. Staff in these offices have generally worked well with our embassies, consulates, and high commissions.

But that is not the point here. The point is one of delimiting or distinguishing the respective competencies of the Commonwealth and the states in the external sphere. Because Australia is a federation with shared powers, the states are in a sense ‘sovereign’ and entitled to exercise their powers even in the external sphere where that is incidental and consequential to the powers that aren’t the purview of the Commonwealth. What the federal parliament cannot do is pass legislation that would blanket out any state government activity abroad or impugn a state government’s prerogative powers in that respect.

In the case of conflicting legislation, the presumption is that the Commonwealth’s would prevail, pursuant to Section 109 of the Constitution. But whether or not any such legislation was inconsistent may be a moot point.

With regard to a state MoU with a foreign government, which is an Executive Act, is it suggested that the Commonwealth could move to veto it pursuant to the External Affairs power. What would that mean? Would it always be clear what is an ‘external affair’ or is it merely one that has an external effect? To what extent should ‘policy’ influence the outcome?

While the External Affairs power can be expanded, as was the Defence Power in times past, that expansion was conditional on the existence of a state of war or the like, or having similar ongoing effects. Such an expansion would similarly be conditional on geopolitical circumstances or the like affecting the nation. Its exercise should not ordinarily pre-empt an area of a state’s functions – domestic affairs that are reserved for the states. Although the Prime Minister conceded state sovereignty over border closures, the legal question of what has been ‘reserved’ or conceded to the states in that regard is complex. It is certainly not categorical.

The line of an external affairs expansion cannot be fixed but should in a given case be settled so as to accommodate both areas of legitimate interest. If Australia were a unitary state, which it could be if it were a republic, there would be no question of a moving line. But as matters stand there is. So if Mr Morrison wants to ride roughshod over certain state interests in the external sphere he had better be prepared to brief counsel at the High Court.

One might also ask what do we stand to gain by these provocations? Australia’s economy is very susceptible to China, which could carry us away in a handbasket, to use an expression.

So what’s the real point? Whose domestic interests are being served by these policies in the guise of the national interest? There will be losers.

Why not take a pragmatic approach instead? Better to be meeting challenges at face value rather than setting the stage for conflict on a broad canvas of hostility and suspicion. Whether or not there is a change in the US Presidency in a few months’ time, our trading relationship, let alone our political relationship, with the Americans will never be the same again nor amount to a guarantee vis a vis China in any sense. We would be better off not pretending to be a key brick in an impregnable fortress. There is no such thing, if there ever was.”

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