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January 4, 2006
A good article by Creg Craven on the forthcoming constitutional challenge to the use of corporation powers in the constitution to underpin and legitimate the recent industrial relations reforms by the Howard Government. Craven highlights the key issue:
In this new constitutional game, all the rules are changed. For a start, incredibly, this has ceased to be a political fight between Liberal and Labor over industrial relations.It is now a highly technical fight between the Commonwealth and the states over the reach of Canberra's corporations power. This is because Howard's legislation is based on the use of the corporations power to regulate the industrial relations envelope of corporations.........The central problem for the Government is that the High Court - usually co-operative towards Canberra - always has nursed a certain nervousness towards the corporations power. The reason is simple. The central expression in the power is "trading corporations". There is no real difficulty in letting the Commonwealth control the trade or trade-related activities of corporations. That obviously goes to the heart of the power.
What if the Commonwealth asserted the power went further, and allowed it to control not just those matters loosely affecting the trade of trading corporations, but every one of their activities, however remote from trade? What if it argued the power also allowed it to regulate a wide range of activities of third parties dealing with trading corporations, again in contexts remote from trade?
That signifies a shift in political power from the states to Canberra. As Craven observes, that means a highly corporatised Australia, in which:
"...the Commonwealth [would have] vast power over an enormous range of activity conducted by and around corporations, which now is controlled by the states. This could include control of hospitals, universities, private schools, local government, town planning and environmental regulation.This is the real hot spot in the industrial relations litigation."
Will the High Court be prepared to concede such sweeping powers to the Commonwealth? it goes to the heart of federalism which the High Court says that it has a duty to defend.
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