Federal, state and territory leaders must use the opportunity presented by this week’s Council of Australian Governments (COAG) meeting to agree to a Charter for New Federalism, the Business Council of Australia says.

This charter will lay the foundations for Australia to reach its full potential.

The BCA today launched a charter that it believes should be adopted by Thursday’s COAG meeting as a key first step to improving Australia’s dysfunctional system of federal–state relations and delivering a revitalised national reform agenda. 

 “The new Labor federal government has indicated a strong commitment to a broad reform agenda, in particular a new cooperative system of federalism to achieve important reforms in key areas of the economy,” BCA Chief Executive Katie Lahey said.
 
“The BCA welcomes this commitment. It also welcomes Prime Minister Rudd bringing COAG together before Christmas to reenergise federal–state relations, as well as his call for this week’s meeting to set timelines for action in key areas of reform.
 
“But we have seen such timelines announced and then slip in the past with little more than lip service paid to real reform action.
 
“Reforming and improving federal–state relations is no longer just a governance issue; it is an economic imperative.
 
“We agree health, education, infrastructure, and business deregulation are all important matters for this week’s COAG meeting, but there is little point agreeing timelines for action unless new processes are put in place to bind all governments to reform commitments,” Ms Lahey said.
 
The charter put forward by the BCA would require, among other things: 

• COAG to meet at least twice each year at set times.
  
• Meeting agendas, commitments and reform timelines to be published on the COAG website.
  
• A jointly-funded permanent secretariat of COAG staff to be established with a rotating chair.
  
• The COAG Reform Council to monitor and report on progress in implementing reform commitments, assess the costs and benefits of reforms, and determine the nature and scope of benefits payments to be made to the states and territories.
  
• The establishment of a federal commission to assess the effectiveness of COAG and its reform agenda in enhancing economic and social prosperity. 

“With the economy operating at full capacity overcoming barriers to growth including inefficiencies in how our governments operate becomes increasingly important,” Ms Lahey said.
 
“This means that now more than ever the need to institutionalise cooperation and to overhaul our dysfunctional system of federal–state relations is critical to Australia’s economic performance.
 
“COAG remains the best vehicle for achieving agreement among our governments on a national reform agenda, but to date lacklustre performance and poor accountability has eroded business and community confidence in COAG’s ability to deliver lasting outcomes.
 
“Agreeing to a Charter for New Federalism will provide a clear demonstration that our governments, led by the new federal government, are serious about improving federal–state relations and delivering on reform action,” she said.

Download the publication, ‘A Charter for New Federalism’