Federal Governments Future Use of the Corporations Power

History has shown that governments given powers, will eventually exercise them
How will history record the use by the Federal Government of the Corporations Power? How extensive is that power?

The Prime Minister and his treasurer may not want to create a spectre of being power-hungry, and are playing down the implications of the historic High Court decision on WorkChoices law.

Associate Professor in Labour and Constitutional Law at Griffith University, Graeme Orr has stated on the ABC PM program[1] that it's unusual to find a power that doesn't get used eventually, and the Government will presumably be taking policies, or if it's re-elected, be considering areas of fresh regulation after the next election.

He said: ‘I think it's just too politically sensitive at the moment for them to be seen to be taking over too much.’

The Federal Government in trying to hose down calls by state premiers for a constitutional convention and continues to reject the possibility of a takeover of state responsibilities.

What is the Corporations Power?
WorkChoices has based for its constitutional validity on the corporations power in Section 51(xx) of the Constitution. Section 51(xx) states:

‘The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to:- (xx.) Foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth.’

Constitutional corporations for the purposes of section 51(xx) are defined as:
• trading or financial corporations formed within Australia
• foreign corporations.

Moving towards One national Australian Industrial Relations system
By basing WorkChoices on the corporations power, all commentators agree that the Federal Government has significantly expanded the coverage of the federal industrial system. Around 85% of corporations, including many non-commercial corporations, are understood to come within the definition of ‘trading’ or ‘financial’ corporations. In addition, the federal industrial relations system now also applies to state and local government corporations and their employees.

What exactly is a trading corporation?
The list is endless, according to former Treasury Secretary and co-founder of the Samuel Griffiths Society, John Stone who said on the ABC, PM program: ‘Obviously a trading corporation is a corporation which engages in trade, that is to say, sells or buys goods or services.’ ‘And as long as we're talking about a corporation, this decision now gives the Commonwealth Government the power to in effect intervene in any aspect of a corporation's activities.’

Examples of trading corporations
Trading corporations include:
* In education, private universities are incorporated.
* So are many private schools
* Our public universities are corporations because they sell educational services
* Childcare centres
* In health, there are many private health clinics that are incorporated.
* Previously state-owned gas and electricity companies are now incorporated.
* Water is traded through state owned corporations
* The list is almost endless, because, the decision of the High Court concerns the relationship between a corporation and its employees.’

Calls for a Constitutional Convention Dismissed by the PM
South Australia's Premier, Mike Rann, has called for a constitutional convention in 2008 on the future of the federation.

The Queensland Premier, Peter Beattie, has also called for a constitutional convention and referendum in response to the High Court's decision in favour of the Commonwealth workplace relations laws.

Prime Minister John Howard said the ruling had not given the commonwealth any extra powers, but had just reaffirmed the powers it already had.

"I know the states are calling for constitutional conventions and so forth - they lost the appeal. It was always our advice that this legislation was constitutional," he told Macquarie Radio. "This does not mean that I am going to embark upon some orgy of centralism. I have no desire to do that."

Mr Howard rejected calls for a referendum, saying there was no need. "We didn't have a referendum because we didn't need one. We enacted a law which we believe was constitutional and the High Court agreed with us[2]."

The Way Forward?
The way is now wide open for a future federal government using the corporations power to takeover of the regulation of electricity companies, childcare centres, universities, private schools and local government. Given the state governments’ poor management of all these areas, that might not be a bad thing, even if it happens by stealth.

[1] http://www.abc.net.au/pm/content/2006/s1789499.htm
[2] http://www.alga.asn.au/news/20061117.php?id=fc4cdd324f967827a081777111ce0263