During recent years, relations between the Queensland government and the National government have been so bad as to make it seem on occasions that the State of Queensland and the Con^monwealth of Australia are hostile foreign powers. The disagreements have been between State and National governments, not between Queensland and ather States. Indeed, relations between most other State governments and the National government have also been characterized by bitter disputation. It is therefore important to recognize that the conflicts are essentially arguments between politicians (and sometimes administrators) and are not arguments between different sections or territorial groupings of the Australian people. Because the State governments collectively and the National government are elected by and serve the same people, the intergovernmental conflicts have been in the nature of struggles for political and administrative power, concerned with determining which governments are to have the power to represent and make decisions affecting the lives of the Australian people. The different governments have all sought to maximize their jurisdiction and control over different parts of the public sector.
Although the power struggles have recently been exacerbated by ideological disputes, it is important to recognize that they are an inherent and inevitable consequence of the federal system of government which operates in Australia. But governments in a federation must establish working arrangements with each other, political conflicts notwithstanding, if the business of goverjiment is to proceed at all effectively.
I have suggested elsewhere that Australian federalism has passed through a number of stages, which may be described as co-ordinate federalism, co-operative federalism, and coercive federalism in order to emphasise the predominant tendency in intergovernmental relations during each period. Under the system of co-ordinate federalism which operated during the early years of federation, governments not only believed that they could act independently of each other but generally succeeded in doing so. Co-operative federalism flourished in the period between the First and Second World W^rs, when governments found it mutually convenient to co-operate in formulating policies and were able to do so from a position of equal bargaining strength, so that their independence was preserved. Coercive federalism had its origin in the financial domination of the National government which began during the Second World War, and was characterized by a growing tendency for the National government to intrude into and impose its priorities on areas of traditional State responsibility.
Despite these changes in the pattern of intergovernmental relations, there has been continuing interaction between governments and a consequential need for them to come to terms with one another, partly to establish their respective roles in policy formation and partly to co-ordinate their activities where interests and responsibilities converge or overlap. One of Mr Wiltshire's major contributions in this book has been to chronicle, for the first time in a systematic and comprehensive way, the agreements and administrative arrangements which have provided the framework for intergovernmental co-operation in Australia.
Within the last year or two there has been a growing recognition on the part of political leaders on both sides in Australia that neither coercive federalism, with its centralizing tendencies, nor the traditional concept of federalism based on complete independence for National and State governments in designated fields of responsibility is adequate as a basis for government. Rather a new approach is needed, which emphasizes the interdependence of governments and the need for them to share responsibility for decision-making in the pubhc sector. Such an approach, which may be described as co-ordinative federalism, contains two elements. First, the traditional vertical division of responsibility along functional lines must give way to a division along horizontal Hues, in which each government assumes responsibility for the decisions it is best fitted to make, having regard to access to information sources, the spillover effects of its decisions on other jurisdictions, and its ability to interpret and respond to community preferences. Second, in areas where the decisions of different governments necessarily and unavoidably interact, a system of responsibility sharing or joint decision-making needs to be devised. This involves co-ordination of taxation and borrowing arrangements, revenue sharing through an appropriate system of intergovernmental grants, and the sharing of responsibility for expenditure decisions by co-ordinating activities concerned with planning, determining priorities and allocating resources in the public sector.
Unfortunately, policy co-ordination on a multi-unit as well as a multi-functional basis greatly complicates the process of government, and makes it necessary for decision-making machinery to be developed in a form that recognizes the common interests and joint responsibilities of the different governments in relation to the decisions taken. It is this which makes Mr Wiltshire.'s book especially timely. By indicating the wide-ranging objectives of past intergovernmental agreements in Australia, the different kinds of administrative arrangements which have been entered into for the purpose of giving effect to the agreements, and the gaps in coordinating machinery which still exist within and between governments, Mr Wiltshire has provided an essential background to the task of establishing a new system of co-ordinative federalism in Australia.
The Centre for Research on Federal Financial Relations is indebted to Mr Wiltshire for the painstaking and exhaustive research that went into the compilation of this book, and believes that it will become a standard work of reference for both students and practitioners of public administration. The Centre is also glad to be associated with the Queensland Regional Group of the Royal Institute of Public Administration in publishing the book, and joins with the author in thanking the Queensland government and its agencies for their co-operation and assistance in extending so significantly our knowledge of political and administrative federalism in Australia.