Western Secessionism
I’m West Australian and West Australians are a proudly parochial bunch. Our distance from our fellow Australians in the east is probably the greatest reason for this. When New Zealand was invited to join the Australian Federation they declined on the basis of distance amongst other things. As Perth is farther from Canberra than New Zealand it does raise some questions as to why we joined in the first place.
The ‘Brisbane Line’ also contributed to Western Australian parochialism. The Brisbane Line was a contingency plan to defend Australia if the Japanese invaded during the Second World War. It entailed abandoning the north and the west to hold a line that ran roughly between Brisbane and Adelaide until help could arrive from the Americans. Whilst there is some conjecture as to the existence of the plan, the consensus amongst historians is that such a plan did exist.
One of the key reasons for Federation was the need for mutual defence. Because of this it’s not unreasonable that many West Australians are somewhat resentful that our fellows in the east planned to just abandon us in the event of an invasion. Surely those in the east can understand that?
So from time to time, some groups in the west talk about succeeding from the Federation. In recent times Norman Moore has been the most high profile public person who has publically adopted a pro–succession stance. The majority of West Australians however are quite happy to remain a part of the Australian Federation. I quite strongly believe that under the current conditions Western Australia should remain a part of the Federation.
The most recent trigger for the talk of succession has been provided by the latest proposed distribution of the goods and services tax (GST). The GST is distributed amongst the states based on a fairly complex formula and right now that formula suggests that for every dollar of GST revenue which Western Australia collects, we should receive just thirty cents with the other seventy cents being distributed amongst the other states.
Predictably the Western Australian Premier and Treasurer strongly disagree with this distribution. The Premiers thoughts are fairly well represented here: http://www.themercury.com.au/news/breaking-news/gst-freeze-good-but-not-enough-nahan-says/story-fnj6ehgr-1227301736938. The treasurer’s view and response to an initial peace offering from the Federal government is here: http://www.skynews.com.au/news/politics/national/2015/04/13/nahan-says-gst-freeze-good-but-not-enough.html. In short they are suggesting that we should ‘actively resist’ the policy and perhaps have our own version of the Boston Tea Party. Heady stuff indeed but it’s also completely ridiculous.
To compare the current situation with the Boston Tea Party is a poor comparison indeed. When the Americans had their little tea party they were protesting about taxation without representation. West Australians have representation, fifteen of them in the House of Representatives and twelve completely unrepresentative swills in the Senate.
This does not however mean that the concerns of West Australians are without merit. When the GST was initially proposed and implemented none of its authors, or State Premiers who agreed to it, could have foreseen one States share of the pie dropping so low. Further compounding the concerns of West Australians about what seems like a very inequitable situation is the response of those in the east to this issue.
Mr Jerico has been particularly vocal on this issue as the two offerings below illustrate.
http://www.abc.net.au/news/2015-04-15/jericho-western-australia-going-it-alone/6393196
Jerico talks about Western Australia being ‘propped up’ by the rest of Australia for much of the last hundred years. On balance that is true. It’s also true that many of us here in the west do not appreciate it, we should.
However – when Jerico notes that a short time ago WA was receiving more than it would expect due to its population size he really is conflating the issues. Sure he’s technically correct but over the sixteen years of the GST this has occurred three times. That’s hardly a broad tread and obviously not the norm. Furthermore to compare receiving 1.04 cents for every dollar, which is a marginally higher amount per capita – with just thirty cents out of every dollar per capita is just absurd. Once again if the Premiers thought that could have ever been possible then none of them would have agreed to the GST in the first place.
Then Jerico notes that for much of the last sixty odd years Western Australia has been getting a ten or fifteen percent share of grants when on population Western Australia should have expected seven percent of the total share of grants. That’s a gap of two to seven percent. To compare that gap with the seventy percent gap in GST revenue between what West Australia now gets and what they would get if it their share was derived on a per capita basis is a remarkably poor comparison.
Compounding these fairly obviously flawed economic comparisons is this utterly ridiculous view that the concept of Horizontal fiscal equalisation (HFE) is somehow an intrinsically important part of our federation. What – Utter – Bunk.
The concept of HFE is a relatively new one. No-one cared about the equalising the level of services between the states in 1900. Initially the federation was proposed to manage key areas such as defence, transport, trade and foreign affairs. That’s was it. Gradually it has morphed into more than that. The idea that HFE is some ‘integral part of our Federation’ is twaddle.
It’s clear that Jerico, and a number of other journalists, have missed the central concern of most Western Australians. On balance I think most West Australians are happy to contribute a higher proportion of their GST to assist the States that don’t have the natural resources which Western Australia has. That level of assistance though should have some kind of limits. Limits that stop one State from getting a very raw deal.
If those limits are not in place then there exists the possibility that in the future the very structure of the Federation could be compromised. Right now it makes little economic sense for Western Australia to secede. But that is right now. Circumstances change. Unless there are some limits to GST redistribution in place then how could we be sure that at some point in the future it might not make economic sense for Western Australia, or another State, to stay with the federation?
The most vacuous amongst us fail to recognise this. It is just these types of failures that can, and in an uncertain future often do, lead to the worst kinds of difficulties for Nation States. The rules governing GST distribution need to be amended. Failure to do so will result in secessionist types of movements gaining momentum and that would be a terrible outcome for us all. I can’t imagine not being Australian. I imagine people in Virginia couldn’t imagine not being American until they were suddenly Confederates in 1861.