Does the Commonwealth have constitutional power to take over the administration of public hospitals?

• Sharon Scully
• Parliamentary Library

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02 July 2009This research paper addresses the question of whether the Commonwealth has the constitutional power to take over and regulate the administration of public hospitals (with or without the agreement of state governments). 

Summary

• The funding and administration of public hospitals is an enduring area of controversy in Australian politics. 

• In recent years, the idea of a Commonwealth takeover of public hospitals has been floated at different times by both major political parties.

• Prior to the 2007 federal election, the Labor Party made the commitment that, should it be elected to government, it would seek a mandate from the public at the following election for the Commonwealth to assume full funding responsibilities‘ for public hospitals if the states and territories have not begun to engage in national health reform by mid 2009.

• However, more recently, the Federal Government appears to be backing away from a complete takeover of public hospitals. The Minister for Health and Ageing, Nicola Roxon, has stated that the Federal Government has always preferred the idea of working with the states rather than a complete takeover of public hospitals. She has also said that the Federal Government would examine the recommendations of the National Health and Hospitals Reform Commission at the end of June 2009 before deciding what action to take.

• This continues to raise the question of whether the Commonwealth would have constitutional power to take over and regulate the administration of public hospitals.

• This research paper finds that, despite the absence of an explicit public hospitals power in section 51 of the Constitution, several factors may enable the Commonwealth to do so; in particular, the continuing fiscal dominance of the Federal Government.