The Treasurers of Australia’s states and territories have formed a new Board of Treasurers, which pointedly excludes Federal Government Treasurer Scott Morrison.

The new body is an initiative of NSW Treasurer Dominic Perrottet, who said that the states and territories need to derive substantially more value than they are currently getting from the existing Council on Federal Financial Relations (CFFR).

“Unless we come together at the state and territory level, our chances of resolving issues by relying on the current processes are slim. There is naturally frustration amongst the states about issues in which we feel we require greater autonomy for the good of our communities and of the nation.”

He listed GST redistribution as a prime example of a critical issue where the states might meet separately without the Commonwealth to “address and coordinate improvements.”

All state and territory Treasurers supported Mr Perrottet’s initiative when they met at the CFFR in Sydney on 27 October.

“I want to see a federation where states and territories are setting the national agenda, helping one another achieve their full potential, and making the whole nation stronger,” Mr Perrottet said.

“This is a great step for collaborative federalism. Under this agreement we will work together on issues of common interest, advancing national reform priorities from a state and territory perspective, including but not limited to an agenda-setting role in federal affairs.”

He said the Board will meet for the first time before the end of 2017, with NSW “progressing the administration of the new body.”

In comments to News Limited media Treasurer Scott Morrison professed not to be concerned by the new Board of Treasurers. “”I think it is a useful idea. I am not shy about working closely with the states and territories,” he said.

“Dominic Perrottet and I have worked closely for many years and I am pleased that he is going to play a role in ensuring closer co-ordination between states and territories and the Commonwealth.”

Many of the states are known to be angry as what they see as unilateral behaviour by the Commonwealth. The same day the new Board was announced Scott Morrison released details of a new National Housing Finance and Investment Corporation, which was developed without state and territory involvement.

Comment

Commonwealth-state relations in Australia are not improving. The problems that have dogged Australia since Federation continue. The states deliver essential services such as health, transport and education, but it is the Commonwealth that collects most of the money that pays for them.

It is a recipe for conflict, which is just what we have. It is hard to believe Scott Morrison when he says he welcomes this new Board of Treasurers. A united stand by the state and territories on key issues such as GST redistribution will make his job much more difficult.

Whether it improves the standard of intergovernmental relations in Australia or not remains to be seen.