Putting laws into action
The federal government raises money to run the country by collecting taxes on incomes, goods and services, and company profits and spends it on national matters: for example, trade, defence, immigration and the environment.
State/territory governments also raise money from taxes but receive more than half their money from the federal government and spend it on state/territory matters: for example, schools, housing and hospitals, roads and railways, police and ambulance services.
Local councils collect taxes (rates) from all local property owners and receive grants from federal and state/territory governments and spend this on local matters: for example, town planning, rubbish collection, water and sewerage, local roads and pet control.
Each of the three levels of government has its own executive that puts laws into action.
Federal executive government
The federal executive, which is made up of the Prime Minister and ministers, is the main decision-making body of the government and is responsible for implementing federal law. This means the executive government puts these laws into action. It also makes sure the laws provide Australians with the services they need.
If a minister needs to introduce a new law or change an existing one, they must first get the approval of the federal executive. The minister then works with their government department to prepare the proposed law, known as a bill, before it is considered by the Parliament.
Each minister is given a portfolio or area of responsibility, and is in charge of a department. For example the Minister for Immigration and Citizenship is in charge of the Department of Immigration and Citizenship. This department provides services related to:
- visiting, studying and working in Australia
- permanent residency and migration to Australia
- Australian citizenship
- managing Australia's borders.
The Minister for Immigration is responsible for seeing that immigration laws are operating effectively across the country.
The executive government needs money to put laws into action. It raises money by collecting taxes on incomes and company profits, and through other charges such as fuel excise and customs duties.
Once a year the Treasurer delivers the Budget to Parliament, which explains how the government will raise and spend this money, including the specific amount of money given to each department. The government must gain approval for its Budget from Parliament. It does this by asking Parliament to pass a series of bills called Appropriation Bills.
Ministers are responsible for managing the proportion of the Budget that has been given to their department. They use this money to administer the laws and programs that fall within their portfolio. The executive government also gives money (revenue) collected through the tax on goods and services (GST) to the states and territories to help fund their provision of services.
The charts on this page show where the federal government gets its money from and what it is spent on.
State and territory executives
States and territories also have executive governments; there are six state and two territory executive governments. State executive government is made up of a premier and state ministers. Territory executive government is made up of a chief minister and territory ministers. These ministers are elected members of the state or territory parliament, and come from the party or coalition of parties that forms government in the lower house. State and territory executives decide on policy and new laws, including how to put state or territory laws into action.
State and territory executive governments get about half their money, including their share of the goods and services tax (GST), from the federal executive government. They also generate revenue from taxes and charges such as:
- stamp duty (a tax on legal documents)
- payroll tax (a tax on the total amount of salaries paid by an employer)
- motor vehicle registration
- land tax (a tax paid by certain land owners on the unimproved value of their property, including holiday homes, investment properties and vacant land)
- gambling licenses.
The states and territories spend this revenue to administer, or manage, laws and to provide goods and services to the people of their state or territory. State and territory ministers, like federal ministers, are responsible for managing the budget given to their department.
The local executive
Elected councillors decide on policy and make by-laws for their community at council meetings. These decisions are then administered, put in place, by the chief executive officer and other non-elected employees of the council.
Local governments receive part of their income in grants from federal and state/territory executive governments. Councils also raise their own revenue through local taxes such as rates (tax on the value of property), sewerage and water charges, dog licences, and user fees for sporting facilities and libraries.