Changes in the federal and state relationship

Closer Look – Governing Australia: three levels of law-making [PDF 2.24Mb, 13 pages]

Radio Licence Case 1935

Until 1974 the federal government charged households a fee or listener's licence for each radio set they owned. The fees were used to finance radio stations. In 1934 Dulcie Williams from Surry Hills in Sydney refused to pay the listener's licence on the grounds broadcasting is not mentioned in the Constitution. In doing so she challenged the federal Parliament's right to make laws about broadcasting.

The case went to the High Court, who found in favour of the government based on section 51 (v) of the Constitution. This section gives federal Parliament responsibility for 'postal, telegraphic, telephonic and other like services'. The Court decided broadcasting could be defined as being like a telegraphic or telephonic service because it involved sending communications over a distance by electronic means.

The High Court's interpretation of section 51 (v) means that today the federal Parliament can make laws about all forms of communication, including television and the internet. For example, it has passed laws to regulate the use of the internet, tackle cyber crime and invest in infrastructure such as the national broadband network.

Since Federation some rulings made by the High Court have strengthened the law-making powers of the federal Parliament. Established under section 71 of the Australian Constitution, the High Court can resolve disagreements between the federal and state governments over their law-making powers. If a law is contested (challenged), it is up to the High Court to determine whether the Constitution gives the relevant parliament the power to make this law. A law judged by the High Court to be unconstitutional is then invalid (over-ruled).

The states' reliance on federal government funding to pay for activities such as schools and hospitals has also shifted the federal-state balance. Federal funding grants make up about half of the states' total revenue. Under section 96 of the Constitution, the federal Parliament can 'grant financial assistance to any State on such terms and conditions as it thinks fit'. This allows the federal government to give 'tied' grants to state governments, directing the state government on how to spend the money. The federal government can then influence the way things are done in areas such as education, health, housing and urban development, which are primarily state responsibilities.

The law-making powers of the federal Parliament have also grown to deal with the huge social and technological advances that have occurred since federation. As Australian society has changed so too have the issues facing federal Parliament. For instance, the drafters of the Constitution could not have foreseen the digital revolution or how central this would become to our society, impacting the way we live, work and communicate. In 1901 there were only 33 000 telephones in Australia and no radio, television, computers or the internet. Today the federal Parliament makes laws about all of these services. It is able to do this under section 51 (v) of the Constitution, which gives Parliament responsibility for 'postal, telegraphic, telephonic and other like services'.


As law and its administration become more complicated, members of the federal, state and local executives are required to work together in order to solve problems.

In 1992 the federal government established the Council of Australian Governments (COAG), which includes the Prime Minister, premiers, chief ministers and the president of the Australian Local Government Association, who meet twice a year to discuss intergovernmental matters. In 2008 the federal government set up the Australian Council for Local Government, so it could work directly with local government as well.

Ministers from the various levels of government also work together on matters of common concern. For example, the Australian Health Ministers' Advisory Council meets regularly to negotiate a coordinated national approach to health policy.

As a result of intergovernmental discussions, uniform national laws have been made to tackle issues such as road transport, food standards and consumer rights. By introducing uniform national laws, the three levels of government can operate together with a greater level of efficiency – an evolution of the Australian system of government that is likely to continue into the future.