How the State exercises power over Local Government By Dale Mazzachi & Norman Waterhouse

HOW THE STATE EXERCISES POWER OVER LOCAL GOVERNMENT

DALE MAZZACHI, PRINCIPAL, NORMAN WATERHOUSE LAWYERS AND CHRIS ALEXANDRIDES, SENIOR ASSOCIATE, NORMAN WATERHOUSE LAWYERS

In 2015, a South Australian motorist refused to pay a parking ticket issued by the City of Adelaide. She elected to be prosecuted. She then refused to recognise the Magistrate’s jurisdiction to hear the matter, or to even approach the bar table, on the basis that she was present in Court “as a woman and […reserved her] unalienable rights to this matter.” 1

In 2020, another South Australian motorist provided an even more succinct argument. When asked for his plea in respect of a parking offence, he replied “I am a man.” This was treated as a plea of not guilty. The man then sat in the public gallery and remained mute during the trial. 2

These individuals, like many other individuals who have sought to rely on the so-called “fl esh and blood” defence and other pseudo-legal arguments (often involving the Australian Constitution, the Queen and/or the United Nations), were unsuccessful.

Local government councils, being (among other things) the entities who make and enforce laws and impose of taxes, are no strangers to pseudo-legal arguments such as these. Indeed, aggrieved persons often deny the very existence of local government.

Although the enabling legislation for local government in South Australia has, since 1929, provided that it is not necessary “to prove the existence” of any council in any legal proceedings, we assure readers that local government does indeed exist.

Anybody seeking authority for the existence of local government in South Australia need look no further than the judgment of His Honour Justice Nicholson in McDougall v City of Playford [2017] SASC 169. 3

His Honour succinctly outlined the City of Playford’s existence in that case as follows:

The City of Playford is a local government council constituted pursuant to and in accordance with the provisions of the Local Government Act 1999 (SA). The power of the Parliament of the State of South Australia to have passed the Local Government Act rests with section 5 of the State Constitution, that is, The Constitution Act 1934 (SA). Section 5 adopts as the powers of the Parliament those formerly exercised by the Legislative Council constituted pursuant to section 7 of the Act of the Imperial Parliament, 13 and 14 Victoria, Chapter 59 entitled “An Act for the better government of Her Majesty’s Australian Colonies”. It has never been doubted that the power thus vested in the Parliament of the State of South Australia is one “to make laws for the peace, welfare and good government of [the State]”. This is a plenary power subject to limitations on its exercise derived from the Australian Constitution. The establishment of local government councils in South Australia, including the City of Playford, is undoubtedly within the legislative competence of the Parliament of South Australia.

By now, readers will hopefully agree that local government has some form of valid legal existence in South Australia. However, what might be interesting to some is the fact this existence is owed purely to the Parliament of South Australia. Councils in other states similarly exist only because of the plenary powers of state parliaments.

Presently, the primary Act of Parliament under which local government councils are constituted in South Australia is the Local Government Act 1999 (special constitutive Acts also apply to the City of Adelaide and Roxby Downs Council). Electoral processes for councils are set out separately in the Local Government (Elections) Act 1999. These laws can be (and frequently are) amended simply by the ordinary procedures of Parliament.

In 1980, the Parliament of South Australia inserted section 64A into the Constitution Act 1934 (State Constitution). That provision “guarantees” the continued existence of elected local government in South Australia. Local government had of course existed in South Australia before the insertion of section 64A into the State Constitution—the City of Adelaide Municipal Corporation was in fact the fi rst municipal corporation in all of Australia (formed in 1840 but insolvent by 1843 with all its possessions sold off by public auction)—but the insertion of section 64A into the State Constitution was, as the Minister of Local Government at the time the Hon CM Hill MLC put it, “major acknowledgement of the maturity and the place of local government in our system of government”. The provision 4 was enacted with bipartisan support.

Eagle-eyed readers will note all that section 64A of the State Constitution promises is some form of elected local government. What local government looks like is entirely up to the Parliament of South Australia. Further, despite the purported “guarantee”, Parliament is still expressly permitted to abolish local government upon the votes of an absolute majority of the members of each House of Parliament. No referendum is required.

In parliamentary debates, equally attentive member of Her Majesty’s then Labor opposition, Hon NK Foster MLC,

stated that the provision does “nothing”. The Hon RC DeGaris MLC rebutted on the Liberal Government’s behalf with the observation that “although it does not do that much, it does do something”.

The minimal protection provided by section 64A of the State Constitution is in fact more protection than other states have afforded to local government. The only states apart from South Australia which provide any sort of restrictive procedure for the abolition of local government are Victoria and Queensland, with a referendum required in each of those states.

Recognition of local government in state constitutions was originally only intended as a largely symbolic fi rst step in a process agreed at the 1976 Australian Constitutional Convention in Hobart. That process was meant to clarify the fi nancial relationship between the Commonwealth, state, and local governments and to culminate in possible recognition of local government in the Australian Constitution.

However, recognition of local government in the Australian Constitution has never occurred. The most recent attempt was in 2013, when the Constitution Alteration (Local Government) 2013 Bill was passed by the Commonwealth Parliament but never put to a referendum due to an untimely leadership change in the governing Labor party.

The notion of local governing bodies being “elected” is one of the few aspects of local government actually entrenched in section 64A of the State Constitution.

However, this does not necessarily mean that all local governing bodies will be made up of elected representatives all the time. 5 Parliament’s ability to confer powers upon the State government of the day to step in and manage the affairs of a

council—“bureaucratic, dictatorial or even despotic though [those powers] may be considered to be” 6 - are not excluded by section 64A of the State Constitution.

The Minister responsible for the Local Government Act 1999 is effectively empowered (via recommendation to the Governor) to put any South Australian council in administration, and to subsequently dismiss the council resulting in new elections. The legal thresholds which apply for the exercise of these powers are not particularly high, relying largely on subjective opinions formed by the Minister. The Minister’s powers are, of course, not immune from judicial scrutiny—see for example the various defi ciencies identifi ed by the Full Court of the Supreme Court in respect of the then Minister’s investigation into the City of Burnside in 2009-2010. 7

Some readers might be quite surprised by the extensive level of oversight which the State government can exercise over local government. For example, looking beyond the power to put a council in administration and to dismiss its members, the Minister also controls whether a council may sell certain land it owns 8 (known as “community land”) or establish any subsidiary 9 either alone or in conjunction with other councils. The Minister can also demand that a council provide any information relating to its affairs or operations 10 as the Minister sees fi t. Individual elected council members are also bound by a mandatory Code of Conduct 11 published by the Minister, and the Minister may refer any alleged breach of that Code to the Ombudsman.

The Statutes Amendment (Local Government Review) Bill 2020 proposes to further extend the State Government’s

infl uence over local government. For example, if passed in the form as originally introduced into Parliament, that Bill would grant some person or body (to be designated by the Governor) the functions of advising councils about “the appropriateness” of any proposed increase in rates revenue, and reporting to the Minister if a council does not “respond appropriately” to the authority’s advice. Such a report can lead to a council being put in administration. In such a circumstance, Councils would therefore not even be able to exercise that most basic power of an elected representative government - the power of taxation - without State government oversight.

Thus, although local government councils are answerable to their electors, they are also answerable to the State government in an increasing number of ways. It is useful for lawyers and other members of the public to be aware that local government is therefore not as ‘separate’ from the State government as some might understand. Councils are subject to myriad oversight mechanisms administered by the State government, and the current trend appears to be that yet more such mechanisms will be added in the coming years.

Nevertheless, local government will continue to exist in some form or another unless and until an absolute majority of the members of South Australia’s House of Assembly and Legislative Council determine otherwise. Given the signifi cant and fundamental contributions which local government councils and their subsidiaries make to the safety, welfare and development of our local communities, the authors contend it would be a brave 12 Parliament indeed to pass such a measure. B