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Thursday, 10 November 1983
Page: 2563


Mr LUSHER(10.56) —I am pleased to have an opportunity to make some contribution to the debate on the Inter-State Commission Amendment Bill. As most honourable members would be aware, the Inter-State Commission has been one of the most contentious of all the instruments that were provided for by our Constitution. It has been the subject of fairly lengthy and often bitter debate over the years. It continues to be a subject which is addressed by students of the Constitution and by academics as well as remaining an instrument that raises its head in a political context every so often.

It is interesting to look back at the history of the Inter-State Commission. In 1898 at the Federal convention Edmund Barton argued that it was not a body for which it was necessary to make provision in the Constitution that was being discussed at that time. Barton argued that section 51 (i.) of the proposed Constitution gave the necessary powers to a Federal government to get involved in the sorts of things that an interstate commission might involve itself in. In any event a commission could have been set up under that section if it had been deemed to have been necessary at any future time and disbanded when it had outlived its usefulness. Other views obviously prevailed in the lead up to the agreement on the Federal Constitution which was adopted in 1901. As we know, the Inter-State Commission was provided for in the Constitution.

It seems that the Inter-State Commission grew out of fears about railways, the pricing and use of railways in a competitive way to enable one State, as against another, to achieve some advantage. It was fundamentally for that reason that the Inter-State Commission emerged. It is quite likely that once the railway problem diminished, as it did not too long after Federation, as other forms of transport became available and the general concerns that were expressed prior to the States coming together and forming a Federation diminished, the concept of an interstate commission may have been forgotten. The discussion that has gone on about the Commission ever since has very largely been related to uses to which our founding fathers probably had not turned their minds.

The fact that an interstate commission has been provided for in the Constitution has been used as an excuse by thinkers, academics and politicians over the years for bringing it back into existence so that it could perform some purpose that may not have been in the minds of the founding fathers. It is interesting to reflect upon that. I do not know whether the body, as it is constituted at the moment or as it was intended to be constituted by the Whitlam Government in 1975, really bears a great deal of relationship to what was envisaged when the provision was agreed upon at the Federal convention and ultimately became part of the Constitution by which we are now governed. Even though it is true to say that the provision of the Constitution does allow the Parliament to decide what powers an interstate commission may have, the overall intent of what form it has today is still quite different from what intentions the founding fathers may have had.

Most people also realise that the Inter-State Commission operated for only three years out of the 82 years of Federation that we have enjoyed. That was in the period between 1912 and 1915. In 1915 there was a challenge in the High Court of Australia to the exercise of judicial power by the Inter-State Commission of the time. As a result of that the Inter-State Commission was allowed to lapse and no appointments were made which would enable it to operate. Finally, I think in the 1950s, in a clean-up of legislation by the Menzies Government, the relevant Act was removed from the statute books. It was not until the advent of the Whitlam Government in the early 1970s that the concept was revived.

It is interesting to look at the way in which the concept was revived not so much because of the way things are today but because it gives a reasonably current indication of the way things may go if a government chooses to try to invest the Inter-State Commission with the powers that were envisaged for it by Mr Charles Jones, the then Minister for Transport in the Whitlam Government. The 1975 Bill gave the Inter-State Commission some very significant powers. It had the power to investigate any matters that related to any mode of transport. It had the power to adjudicate in matters of dispute arising out of the pricing and structure of interstate and overseas transport services. The adjudication powers related to preference in discrimination in the provision of overseas or interstate transport, either by States or by the providers of a transport service. It had the power to investigate matters relating to trade and commerce in general, and that was certainly cause for great concern in 1975. It could exercise statutory powers in matters relating to trade and commerce and it freed the decisions of the Inter-State Commission from challenges by other statutory bodies such as the Trade Practices Commission and the then Prices Justification Tribunal. It also had the power to arbitrate on matters relating to trade and commerce. Those powers, which were intended for the Inter-State Commission, caused an inordinate degree of concern not only to the Opposition but also to the community and industry generally.

The result was a very long and bitter debate in the Senate. At the time the Senate succeeded in convincing the government to accept very heavy amendments which changed dramatically the nature of the Inter-State Commission. The Act which emerged from the Senate after that lengthy debate and heavy amending process resulted in an Inter-State Commission which was restricted to domestic transport matters, specifically excluding the two-airline agreement. It could deal only with matters that related to roads, rail, coastal shipping, pipelines and general aviation. The Inter-State Commission, as provided for in the Act, had no authority to initiate investigations or make any orders. It could investigate only matters that were referred to it by the Minister for Transport and it had no power to arbitrate. So there was quite a dramatic difference between the provisions of the Inter-State Commission Act 1975 and the provisions of the Inter-State Commission Bill as introduced by the Government in that year. In effect, the Inter-State Commission can only investigate, consult and make recommendations to the Minister on those matters that he has referred to it. It has been described by the Minister for Transport (Mr Peter Morris), as well as by others, as being an ongoing royal commission and a transport user's tribunal. That is the way that things stand at the moment.

The Bill was not proclaimed before the Whitlam Government went out of office in November 1975. It just lay untouched over the entire period of office of the Fraser Government. On the Australian Labor Party's return to government in March this year the Minister made it clear that the Act would be proclaimed. I think it was proclaimed in October. So the legislation is now in force. The purpose of the Bill that is before the House at the moment is to provide for some minor machinery amendments that will tidy up some of the administration and Public Service-type aspects of the Bill to make it current with the circumstances that apply at the moment. The Opposition does not seek to raise any problems in relation to the Bill. The Opposition takes the attitude that, if the Inter-State Commission is to exist and operate, it is obviously stupid to try to enforce in 1983 and the period beyond salary levels and other things that were appropriate in 1975.

I want to raise some general problems about the Inter-State Commission, its operation and the concept of the Commission in general. One of the problems that I think needs to be considered is that the Inter-State Commission will certainly duplicate the activities of other bodies. Whether that is a good thing or a bad thing is probably a matter to be resolved. It is certainly the case that the sorts of things for which the Inter-State Commission is intended by the Government are things that can be, or in fact are being, carried out by organisations such as the Bureau of Transport Economics, the Transport Industries Advisory Council, the Australian Transport Advisory Council, the Industries Assistance Commission, the Trade Practices Commission and, no doubt, a range of other instrumentalities, organisations and groups, formal or otherwise, that make a contribution in the area within which it is intended that the Inter-State Commission will operate. I think it is also a potential problem that the Inter-State Commission would compete with, as well as duplicate, some of the activities of the bodies which I have mentioned. I think we have to be aware of and alive to the sorts of problems that can arise when public instrumentalities find themselves in competition with one another. It is something that is not always trouble free and it may cause difficulties for policy in general as well as perhaps for the operations of the individual instrumentalities concerned.

One of the other difficulties is that the Inter-State Commission, in the form in which it now finds itself, has only an advisory capacity. Anything that would need to happen as a result of any recommendations that the Inter-State Commission might make to the Minister would have to take legislative form. It is quite likely that the sorts of recommendations that are made, when put into legislative form, could raise constitutional problems, and challenges may be mounted against them. I think it is probably most likely that those problems would arise in relation to section 92. A lot of the things in which it is likely that the Inter-State Commission would be involving itself at the Minister's direction and making recommendations about would be matters that would, in their resolution, affect trade between the States and might, therefore, result in challenges from other bodies that might consider themselves to be disadvantaged by the recommendations the Minister might seek to put into legislative form. That is another difficulty that is raised by the existence of the Inter-State Commission and the operations in which it would be involved under the direction of the Minister.

Another problem is the general question of whether it is better to have an interstate commission on an ongoing basis with a permanent secretariat and the capacity to develop and build up some expertise, carrying out the inquiries and the instructions that the Minister might give it from time to time, or whether it is better to set up independent or separate inquiries to do those tasks on behalf of the Minister. One particular example which is with us already has some relevance. The Government, in its first few months in office, has been concerned about the problems that exist in the long distance haulage industry, or the trucking industry, as it is generally called. The Government has been concerned to establish an inquiry to consider the problems of that industry and to make some recommendations about what could be done to resolve these problems if, in fact, they are identified. That, I would have thought, would have been an appropriate inquiry to have referred to a body such as the Inter-State Commission. I do not really think any significant timing was involved. Either the Minister could have proclaimed the Inter-State Commission a month or two earlier than he did or he could have set up his road freight inquiry a little later than he did. In any event, only a couple of months difference were involved. Yet the Minister chose to refer the road freight matter to a special inquiry, the National Road Freight Industry Inquiry, headed by Mr May, not to the Inter-State Commission.

The Government also has concerns about the Tasmanian freight equalisation scheme. It is keen to look at what is going on with Tasmanian freight equalisation. It has chosen to refer that matter, as the first reference, to the Inter-State Commission. I think it just raises the question as to whether the Inter-State Commission is the best mechanism, firstly, to have and, secondly, to use, or whether it is appropriate to do as the Minister did in the case of the road transport inquiry and refer it to a particular body for investigation. I do not make any value judgment about it. I think that the way in which the two inquiries have been handled raises the question of whether the Inter-State Commission is absolutely necessary. The arguments that could be raised in relation to having it and using it to inquire into the Tasmanian freight equalisation scheme would obviously be arguments against having the road transport inquiry referred to a body other than the Inter-State Commission.

Another difficulty-something which the Opposition is continually concerned about-is that every time another commission or instrumentality is set up, it inevitably becomes part of the bureaucratic structure. It becomes to some extent a self-justifying body, and it tends to lose some of the ginger and vigour that may be present in instrumentalities that are not of a permanent nature. It will be interesting to see the quality of the report that comes, for instance, from the May inquiry into road freight and the different reports that come from the Inter-State Commission over the years as it starts to settle into the role that the Minister has in mind for it. I think it is inevitable that the Inter-State Commission will seek to entrench itself in bureaucratic terms, and it will probably become a consumer of funds and a larger and larger employer of people. That is just one of the concerns that I think we must have in mind when we look at whether we should set up a body such as this Commission.

Centralisation may be another difficulty in relation to the Inter-State Commission. The fact is that it is a Federal body. It is my understanding that the Minister does not have to consult with his State counterparts before he makes references to the Commission. It may well be that the things that it looks at are things that suit the Commonwealth Government rather than State governments and that the result will be a tendency to acquire more power in the hands of the Commonwealth Government and perhaps less power for the States. I, for one, would be concerned if the Inter-State Commission were ultimately to develop a role which resulted in the Commonwealth picking up more activities which are properly activities for a State government. I would not want to sit idly by watching that happen.

The other side of the coin is the States' rights question. I am not sure what the Minister's intentions are in relation to the States and consultation with the States. The Minister has indicated that he will refer the Tasmanian freight equalisation scheme to the Inter-State Commission. He may have already done so. I do not know whether he had consultations with the Tasmanian Government before- -


Mr Peter Morris —We have an assurance that there will be consultation.


Mr LUSHER —The Minister gives an assurance that there will always be consultation. I am certainly grateful to hear that, because I do not think it would be healthy for federalism as a whole and for the relationship between the Commonwealth and the States if the Commonwealth were to set up inquiries into things such as the Tasmanian freight equalisation scheme without having prior consultation with the State governments, in this case the Tasmanian Government.

The other concern that I have, which is a problem that may arise with the Inter -State Commission, is that it is unarguably a vehicle that can result in greater regulation. I am not in favour of greater regulation. I think the Minister understands that. Generally speaking, the Opposition would seek to move in a long term general direction toward less, rather than more, regulation. It has been put to me that the Inter-State Commission could deregulate as much as it could regulate. I acknowledge that. I would not want to see it moving down a track which resulted in greater regulation. If it did result in some deregulation within the transport industry, it would probably meet with my approval.

I am a little concerned about developments in the road freight inquiry. Although my concern is not directly related to the Inter-State Commission, it could easily have been. My concern is that, apart from the restaurant industry in this country, the road freight industry is one of the most competitive. Although the sheer fact of the competitiveness in the industry does lead to people going broke and does lead to some problems in relation to safety, the reality is that we have been able to maintain over a long period very competitive freight rates, and those freight rates have been to the advantage of industry generally and have assisted the economic growth of this country. I would be concerned if the May inquiry came out with proposals that would result in heavy regulation within the transport and trucking industry. I express the same concerns in relation to the inquiries in which the Inter-State Commission may become involved at the Minister's direction.

I approach the concept of the Inter-State Commission with a great degree of caution. Certainly, the concept does not carry my wholehearted endorsement, whether the Commission is in its present form or in any form which ultimately gives it greater or lesser power. I think it would become apparent that the benefits or the dangers of the Inter-State Commission would depend in large part upon whose hands it is in. I accept in good faith that the Minister of the day does not have any intentions-I imagine he does not have any intentions-of using the Inter-State Commission as some sort of draconian vehicle to implement all sorts of horrible socialist policies, regulatory policies and things of that nature. I acknowledge that the Minister would not seek to use the Commission for those ends. Equally, this Minister will not be in charge of this portfolio-I do not think he would seek to be-for time immemorial. The reality is that we must ensure that the Inter-State Commission is not, for instance, subjected to amendments which would return to it the powers that were ascribed to it or intended for it when the original Bill was introduced in 1975. The Opposition obviously would not look favourably on any attempt to amend the legislation in such a way as to increase the powers of the Inter-State Commission. I do not deny that if in the present form it is used as some sort of ongoing royal commission and as an instrument of advice to the Minister and the Government it may serve some useful purpose. However, I mention again the questions I raised a little earlier. I ask whether the Commission is absolutely essential and whether what it seeks to achieve could have been achieved in other ways. Time will tell. But I think, and the Opposition believes, that it is essential that the Commission be limited to the role that was given to it in the 1975 Act.

I assure the Minister that we will closely watch the operation and the deliberations of the Commission and the sort of output that comes from it, as well as the references that he gives it. I conclude by saying that any consideration of the Inter-State Commission in its present form must be essentially a balanced, consideration or analysis. I say in all honesty that my preference is that we do not have an Inter-State Commission. But the reality is that we do have it. It is in a form that was ultimately agreed to by the Senate back in 1975. It is my understanding that the Minister does not seek to change the powers it emerged from the Senate with at that time. So whilst it certainly is a matter for the Parliament to decide what powers the Inter-State Commission might have, although those powers are not to include the exercise of judicial powers, I think we would not wish the Government to try to increase the powers the 1975 Bill provided to the Commission.

The only other thing I would like to say is that the only possible alternative to an Inter-State Commission, apart from the other bodies that operate in a similar field, is what we can call loosely co-operative federalism and the use of bodies such as the Australian Transport Advisory Council, and others, constructively towards trying to overcome the sorts of problems that the Inter- State Commission will, I imagine, be seeking to overcome. It may well be that a co-operative federalist approach may avoid a lot of the problems that could develop in the use and operations of the Inter-State Commission, but that is certainly not going to happen at this time. I just raise it as being a possible alternative to an interstate commission in an attempt to achieve the sort of end that the Commission will seek to achieve. The Opposition does not oppose the legislation. We will be watching very closely the operations of the Commission as it undertakes the tasks which the Minister will give to it.