Council of Australian Governments

The Council of Australian Governments (COAG) is an organisation consisting of the federal government, the governments of the six states and two mainland territories and the Australian Local Government Association.

History

COAG was established in May 1992 after agreement by the then Prime Minister (Paul Keating), premiers and chief ministers, and it first met in December 1992. It is chaired by the Prime Minister. It meets to debate and co-ordinate government activities between the federal and state or territorial governments and between the state and territorial governments themselves as well as issues affecting local government.

COAG grew out of the Premiers' Conferences, which had been held for many decades. These were limited to the premiers of the six states and the Prime Minister.

A related organisation is the Loan Council, which coordinates borrowing by the federal and state and territorial governments of Australia.

COAG differs from the U.S.'s National Governors Association or Canada's Council of the Federation, because these bodies only include state/provincial representatives, whereas COAG also includes federal and local representatives.

Current membership

COAG and state finances

Australia is believed to be the first federation to have introduced a formal system of horizontal fiscal equalisation (HFE) which was introduced in 1933 to compensate States which have a lower capacity to raise revenue. Many federations use fiscal equalisation to reduce the inequalities in the fiscal capacities of sub-national governments arising from the differences in their geography, demography, natural endowments and economies. However the level of equalisation sought varies. In Australia, the objective is full equalisation.

Full equalisation means that, after HFE, each of the six states, the Australian Capital Territory and the Northern Territory would have the capacity to provide services and the associated infrastructure at the same standard, if each state or territory made the same effort to raise revenue from its own sources and operated at the same level of efficiency.

Currently the funds distributed to achieve HFE are the revenues raised from the Goods and Services Tax (GST), currently about AUD50bn a year. The distribution of GST required to achieve HFE is decided by the Federal Treasurer each year, on the basis of advice provided by the Commonwealth Grants Commission (CGC).

Achieving HFE does not mean that the states and territories are directed how to raise revenue or how to spend their funds. GST revenue grants from the Commonwealth are unencumbered and available for any purpose. Accordingly, HFE equalises fiscal capacity, not fiscal policies which remain for the states and territories to decide for themselves. It does not result in the same level of services or taxes in all states and territories, direct that the states and territories must achieve any specified level of service in any area, nor impose actual budget outcomes in accordance with the Commission's calculations.^[2]

At its meeting on 13 December 2013, COAG agreed to streamline the COAG council system and refocus on COAG's priorities over the next 12 to 18 months.

List of COAG councils

There are now eight COAG councils:

• Federal Financial Relations Council;
• Disability Reform Council;
• Transport and Infrastructure Council;
• Energy Council;
• Industry and Skills Council;
• Law, Crime and Community Safety Council;
• Education Council; and
• Health Council

There is no longer a distinction between standing and select councils, as all councils are time-limited.^[3]

The Select Council on Disability Reform expired on 31 December 2012 due to the passage of National Disability Insurance Scheme legislation.

Reports

On 30 August 2012, COAG released its Housing Supply and Affordability Reform report, proposing reforms to increase housing affordability in Australia. The report omitted the fact that of the 20% of Australia (more than 1,500,000km2) owned by Aboriginals and Torres Strait Islanders, they are not allowed to own their own home.^[4]

Criticism

In 2012 a group of 20 environmental organisations release a joint communiqué denouncing the establishment of the COAG Business Advisory Forum and wanted wider representation on the Forum. The groups also opposed the weakening of environmental regulations.^[5]

See also

• Fiscal imbalance in Australia
• Inter-State Commission

References

External links

Wikinews has related news: Australian governments to meet for first COAG meeting of 2006 today

• Council of Australian Governments