In the Fairfax broadsheets this morning, constitutional law academic George Williams gives his reading of the High Court’s judgment in Pape v Commissioner of Taxation and the Commonwealth of Australia.
As readers may recall, earlier in the year UNE academic Bryan Pape challenged the constitutional validity of the government’s tax bonus payments. Unlike the whinging cultural offspring of the welfare state who missed out on it, Pape was among other things seeking an injunction stopping the ATO paying him the money.
The High Court decided against him, but as is common in constitutional cases there were many different arguments made. Williams argues that though the Commonwealth persuaded the Court on enough of these to get a verdict in its favour, comments made by the judges on their other arguments raise questions about the validity of other Commonwealth spending.
The issue here is that the Commonwealth has long spent money on things for which it has no legislative power under the Constitution. Various additional spending powers have been read into the Constitution as relating to the executive power of the Commonwealth or an implied ‘nationhood’ power. As Justice Mason put it in 1975:
there is to be deduced from the existence and character of the Commonwealth as a national government and from the presence of ss 51(xxxix) and 61 a capacity to engage in enterprises and activities peculiarly adapted to the government of a nation and which cannot otherwise be carried on for the benefit of the nation.”
This seems to be the main legal basis for general research funding in Australia (though research relating to subjects that are expressly Commonwealth powers would clearly be justified on the text of the Constitution).
On my quick reading of the Pape case, Chief Justice French and Justice Heydon are nationhood power sceptics. Justices Hayne and Kiefel reject the view that the Commonwealth can spend on anything it chooses, rejecting an argument by the Commonwealth that it has power from this source to legislate for the ‘national economy’. That’s four of seven going for constraint.
There are ways around constitutional issues, such as tied grants to the states, and arguably most of this spending survives less because it has a clear legal basis than because there is nobody to challenge it in the High Court.
I will wait with interest expert legal commentary on whether the status of research spending and other spending based on imaginative reading of the Constitution is called into question by this judgment.