There’s one certainty about the impact of political alignments on Commonwealth-state relations: having a Prime Minister of one political persuasion and state and territory leaders all of the other is a recipe for complete dysfunction. The Council of Australian Governments process virtually ground to a halt in the last Howard government term because co-operation was impossible between John Howard, especially as he became more and more concerned about the threat of Kevin Rudd, and Labor leaders desperate to ensure a Labor win.

It was assumed at the time that the Rudd ascension would usher in an unprecedented period of Commonwealth-state co-operation. Similar assumptions are being made now in anticipation of Liberal victories in Tasmania and South Australia tomorrow (although the Liberals haven’t won outright in South Australia since 1993, so wait until Jay Weatherill concedes before adding it to the blue map). They would leave just the ACT’s Katy Gallagher as the lone Labor representative and, while we shouldn’t forget then-chief minister Jon Stanhope’s gutsy stand on national security laws in 2005, that is almost as good as a political bluewash.

But in reality, Rudd found it difficult reaching consensus with his state colleagues, and he resorted to buying off their agreement to even relatively minor reforms, back when he had the fiscal flexibility to do so. And reforms that were agreed in areas such as regulatory harmonisation ended up being piecemeal, as states dragged their heels on necessary reforms after the event. A COAG Reform Council review at the end of 2012 showed that nearly half of COAG’s agreed regulatory reforms, including some agreed by Julia Gillard and the states, were delayed or simply hadn’t been done — something those who think a blue political map will usher in a new era of deregulation ought to consider.

It’s thus possible that Prime Minister Tony Abbott might oversee exactly the kind of COAG cycle that Rudd did — starting off with a COAG entirely composed of like-minded leaders but failing to overcome parochialism and heel-dragging to achieve anything major, until Liberal leaders start getting replaced with Labor leaders again (potentially in Victoria at the end of the year) and the system resets to its dysfunctional norm.

This has implications for potentially the most exciting, indeed revolutionary, addition to the COAG agenda under Abbott — a serious effort to resolve bureaucratic duplication between states and the Commonwealth. Ending duplication is a great idea but is more complicated than simply cleaning out the Department of Health at Woden in Canberra and letting the states run the health system. It has implications for funding, which is complicated enough given financially fragile states won’t want to have more functions to perform without the money to fund them, and for responsibility for politically sensitive services. Achieving genuine reform in how education and health, in particular, are overseen and how policy is delivered in the mixed funding environment of a federation will be a huge challenge even with every COAG leader wearing a blue tie.

Hopefully Abbott will be more aggressive than Rudd, who seemed unwilling to use the full power of the prime ministership until John Brumby began placing serious obstacles in the way of his proposed health reforms in 2010. As national leader, Abbott has the responsibility and the right to demand the subordination of state interests to the national interest. He’s also previously indicated, via his thinking on federalism in his book Battlelines, a willingness to contemplate ways of overriding states that refuse to co-operate with the Commonwealth.

Abbott could, potentially, exploit his COAG opportunity in a way Rudd was unable to. That’s likely the only way we’ll avoid a repeat of the Rudd years.

Peter Fray

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