Inside Story

Urgent, unforeseen — and far-reaching?

A leading constitutional lawyer looks at why the High Court decided to agree with the government about the same-sex marriage survey

Tony Blackshield 8 September 2017 2173 words

The co-chair of Australian Marriage Equality Alex Greenwich (left), the Human Rights Law Centre’s legal advocacy director Anna Brown, and Public Interest Advocacy Centre CEO Jonathon Hunyor talk to journalists outside the Commonwealth Law Courts Building in Melbourne earlier this week. The three organisations were involved in making the plaintiffs’ case before the High Court. James Ross/AAP Image

Last Tuesday and Wednesday the High Court heard challenges to the Turnbull government’s plan for a postal survey to measure popular support for the legalisation of same-sex marriage. Before the hearings began, it had looked as if the challenges might be successful; but by the end of Wednesday’s hearing it seemed clear that the arguments advanced by the solicitor-general, Stephen Donaghue SC, had comprehensively ensured that the challenges would fail. And sure enough, on Thursday afternoon — in the middle of parliamentary question time — chief justice Susan Kiefel announced that the seven judges had unanimously rejected the plaintiffs’ submissions.

The two challenges involved three individual plaintiffs — Andrew Wilkie MP, Felicity Marlowe and Greens senator Janet Rice — along with Australian Marriage Equality and the PFLAG organisation (Parents, Family and Friends of Lesbians and Gays). Between them they presented a number of arguments. It was argued, for example, that the last-minute decision to convert the idea of a “plebiscite” (presumably to be conducted by the Australian Electoral Commission) into a “postal survey” (to be conducted by the Australian Bureau of Statistics) was invalid because the polling of yes-or-no answers to a question about same-sex marriage did not involve “statistical” information. It was also argued that arrangements for the Australian Electoral Commission to assist the Bureau of Statistics in conducting the “survey,” in part by supplying it with information from the electoral roll, went beyond the AEC’s statutory powers and functions.

The central issue, however, related to the decision by senator Mathias Cormann, in his capacity as finance minister, to increase the departmental allocation for the Australian Bureau of Statistics by an additional $122 million to enable it to conduct the survey. That decision was made under section 10 of the Appropriation Act (No. 1) for 2017, which authorises the minister effectively to increase a departmental allocation (by “so much… as the finance minister determines”) if he “is satisfied that there is an urgent need” for additional expenditure, arising “because the expenditure was unforeseen” at the time of the May budget. In short, the minister could only grant such an increase if he were “satisfied” that the need for it was both “urgent” and “unforeseen.”

An ordinary reader, applying common sense to ordinary English usage, might have thought that the question of whether the minister was “satisfied” was a subjective question which could only be answered by the minister himself. But the ordinary reader would have been wrong. The decision made by the minister in such a case is an administrative decision potentially subject to judicial review. If the process by which the minister has satisfied himself depends on an error — if, for instance, he has misapplied or misunderstood the criteria on which his satisfaction depends — then his decision can be overturned. Accordingly, it was legitimate to ask not merely whether the minister was satisfied, but whether the criteria were satisfied.

The criteria here were twofold: that the need for special funding was “urgent” (at the time of the decision in August) and had been “unforeseen” (at the time of the annual budget in May). Again, an ordinary reader, applying common sense to ordinary English usage, might think that neither criterion was satisfied. The controversy over the government’s failure to deal with the issue of same-sex marriage had rolled on for at least four years, and the possibility of a plebiscite to be conducted by an optional postal vote had been actively canvassed at least since March. The decisions made on 9 August were taken because, earlier that day, the Senate had (for the second time) failed to pass legislation which would have referred the issue of same-sex marriage to a compulsory plebiscite to be conducted by normal electoral procedures. But that failure in the Senate came as no surprise; Senator Cormann himself had predicted it as early as February. In any event, far from being treated as urgent, both the unsuccessful proposal for a compulsory plebiscite and the substitute proposal for a postal survey were widely perceived as delaying tactics by which the Turnbull government was seeking to evade or defer its own responsibility to act on the issue.

Again, however, the ordinary reader would have been wrong. As Stephen Donaghue told the court on Wednesday, precisely because the word “urgent” is “just an ordinary English word,” it follows that urgency “is a relative concept” — “some things are relatively more urgent than others.” Donaghue was on safe ground here because on 24 August, in the context of fixing a timetable for the hearing of issues arising from section 44 of the Constitution, the chief justice had told him that “there is urgency and urgency.” As Donaghue now elaborated on that idea in the context of Senator Cormann’s decision:

The level of urgency requires an evaluative judgment to be made between different and competing priorities and in that context we submit it is entirely appropriate… to repose that judgment in the Executive on the satisfaction of the Executive because it is not a judgment… which can lend itself to bright lines enforceable in litigation.

In short, though the question whether the minister is “satisfied” is not in itself a subjective question to be answered only by him, the question whether he is satisfied that a matter is “urgent” is subjective in precisely that sense. At the very least, Donaghue told the court:

where the cabinet has decided that a particular policy should be pursued and that it should be pursued in a particular timeframe — it is open to the finance minister to be satisfied that that generates urgency of the kind to which the section is directed.

As for whether the need was “unforeseen,” there was no attempt to deny that the possibility of a postal survey had been foreseen; but Senator Cormann had explained in an affidavit that what had been “unforeseen” at the time of the budget was the possibility that the postal survey might be conducted by the Australian Bureau of Statistics. This, of course, is the ultimate irony: the reason why the government’s decisions in August were greeted with such incredulity was precisely that no reasonable person could have imagined that such a task might be thrust upon the Bureau of Statistics. To say that such a solution was unforeseen (and indeed unforeseeable) is entirely convincing.

In any event, Donaghue’s submissions to the court put the point in a statutory context. The effect of an additional allocation of funds by the finance minister under section 10 is to add to a particular “departmental item.” Thus, what Senator Cormann did on 9 August was precisely to provide additional funding for the Bureau of Statistics; and the need for a further allocation to the Bureau of Statistics was precisely what, under section 10, was required to have been “unforeseen.”

Incidentally, a careless slip in one of Senator Cormann’s statements had led the plaintiffs to argue that he had conflated the words “urgent” and “unforeseen” into a single criterion, and had therefore failed to give each criterion the separate consideration required. In the wider context, however, it was clear that Cormann had not failed to do this. The difference between the two criteria was neatly explained in Donaghue’s argument:

The unforeseen criterion is a criterion directed to why the expense was not included in the last Appropriation Act, why it was not included in the budget, and the urgency requirement is an explanation of why it is not waiting for the next one.

Behind the immediate question of whether the criteria in section 10 of the Act had been satisfied was a larger question of whether the entire procedure for additional funding under section 10 was constitutionally valid. Only one of the two cases before the court had sought to raise that question, and it did so without success. But the reasons for the court’s unanimous rejection of the argument are potentially of much greater constitutional importance than the immediate issue about the postal survey. They relate to the extent to which the executive government can act without parliamentary approval, and in particular the extent to which it can appropriate money without such approval.

According to Section 83 of the Constitution, “No money shall be drawn from the Treasury of the Commonwealth except under appropriation made by law.” In 1924, in an appeal from New Zealand, the Privy Council was even more emphatic: “no money can be taken out of the consolidated Fund… excepting under a distinct authorisation from parliament itself.” The principle is fundamental, and reflects the historical assertion of parliamentary control over the Crown.

On the face of it, the power of the finance minister to make a “determination” permitting additional expenditure is an exception to this principle. The exception is authorised by parliament (through section 10 of the Appropriation Act) and is subject to an upper limit (the combined total of all such additional expenditures in any one year must not exceed $295 million); but it is not reviewable by parliament. Section 10(4) provides that such a determination is “a legislative instrument,” but is not subject to the normal rules according to which a “legislative instrument” can be disallowed by the Senate.

A basic departure from the separation of powers in the Westminster system of government is the fact that the executive government can be authorised to make regulations: that is, legislative power is delegated by the parliament to the executive. In 1931, when the High Court held that this exception to basic constitutional principles was sanctioned by long historical usage, the court emphasised that the exception was still subject to parliamentary control because regulations could be disallowed by the Senate. That ultimate possibility of control has always been regarded as important. But for ministerial “determinations” of a need for additional finance, that possibility is expressly negated by section 10(4).

The fundamental issue is an important one, especially at a time when the constitutional relationship between legislative and executive power is attracting increasing judicial scrutiny. When the court’s written reasons for judgement are delivered, what is said about this issue is likely to be of particular interest. But in this immediate context the attack on the minister’s power under section 10 was difficult to establish, and it is not surprising that it failed.

It failed essentially because here, too, the exception to fundamental principle was established by long historical usage. A provision for ministerial advances of additional funds for unforeseen circumstances has been a feature of Australian legislation since the very beginning — going back, as Stephen Donaghue put it, to “the very first Act ever passed by the Commonwealth Parliament, Act No. 1 of 1901.” Indeed, as Donaghue demonstrated in an exhaustive historical survey, the scope for ministerial discretion in allocating additional funds had until quite recently been much less circumscribed by statutory safeguards than it is now.

An even more fundamental issue was whether the plaintiffs were entitled to challenge the additional funding at all. In 1974 the Whitlam government included in its annual Appropriation Act a sum of almost $6 million for the Australian Assistance Plan, a project established to advance a policy of regional decentralisation for which there was no legislative basis. In a High Court of seven, three judges held that the appropriation was valid, and three judges held that it was not. The seventh judge, Sir Ninian Stephen, held that a mere appropriation of money was not subject to legal challenge. In order to bring legal proceedings in a federal court, plaintiffs must show that the issue directly affects them in some way that entitles them to “standing”; but according to Stephen, an appropriation of money merely “earmarks” the money in a way that affects no one.

The result was that the challenge to the appropriation failed, by a majority of four judges to three, but with no majority support for any reason for that result. Stephen’s view that no one can have “standing” to challenge an appropriation of money was decisive of the outcome, but it was the view of only one judge. But in 1988 three High Court judges (Mason, Deane and Gaudron) said of the 1974 case:

The case… stands as an authority for the proposition that the validity of an appropriation act is not ordinarily susceptible to effective legal challenge. It is unnecessary to consider whether there are extraordinary circumstances in which an appropriation of money by the parliament may be susceptible to such challenge. It suffices to say that, if there be such cases, the present is not one of them.

The rules about “standing” have been greatly relaxed since 1975, especially in constitutional cases, and the view taken by Ninian Stephen in the AAP case is unlikely to have survived in precisely that form. Nevertheless, Stephen Donaghue used it to suggest, at the forefront of his argument before the High Court last Wednesday, that the plaintiffs challenging the allocation of money for the “postal survey” had no standing to do so. Of the many questions raised by the case, this may be the most interesting of all. On that question, though, the formal order announced by Chief Justice Kiefel on Thursday said simply: “Inappropriate to answer.” •