Federalism, State Constitutions, and Commonwealth-State Relations

Principles of Federalism

• Australian Federalism

  • Power is divided between a central government and six State governments, each possessing its own governmental institutions.

  • The power of the federal government is constrained to specific powers outlined in the Constitution, such as the heads of power in $s51$, $s52$, $s122$, etc.

  • State power is considered unlimited or 'plenary', subject only to the Federal Constitution, and is expressly preserved by the Constitution in $ss.106-108$.

  • This 'plenary power' of the States is also retained under their respective state constitutions (e.g., Constitution of NSW $1902$, $s5$).

• Value of Federalism

  • It grants discretion to the High Court.

  • It promotes 'states rights', advocating for smaller government.

  • In theory: A smaller political arena encourages more direct individual participation compared to a monolithic unitary government.

  • In practice: A larger, centralised political arena allows for uniform regulation and provides a greater pool of resources to address social problems on a larger scale.

• Examples of Federalism in the Constitution

  • $s51(ii)$: Grants the Commonwealth Parliament power over taxation, but prohibits discrimination between States or parts of States.

  • $s99$: Prevents the Commonwealth from giving preference to one State over another in matters of trade, commerce, or revenue.

  • $s92$: Declares that trade, commerce, and intercourse among the States shall be