The Council of Australian Governments (COAG) is the "peak intergovernmental forum in Australia". Comprising the federal government, the governments of the six states and two mainland territories and the Australian Local Government Association, it manages governmental relations within Australia's federal system.
COAG grew out of the Premiers' Conferences, which had been held for many decades. These were limited to the premiers of the six states and the Prime Minister. A related organisation is the Loan Council, which coordinates borrowing by the federal and state and territorial governments of Australia.
COAG was established in May 1992 after agreement by the then Prime Minister (Paul Keating), premiers and chief ministers, and it first met in December 1992. It is chaired by the Prime Minister. It meets to debate and co-ordinate government activities between the federal and state or territorial governments and between the state and territorial governments themselves as well as issues affecting local government.
COAG differs from the US's National Governors Association or Canada's Council of the Federation, because these bodies only include state/provincial representatives, whereas COAG also includes federal and local representatives.
|Name||Office held||In office since||Party|
|Scott Morrison MP||Prime Minister of Australia||24 August 2018||Liberal|
|Gladys Berejiklian MP||Premier of New South Wales||23 January 2017||Liberal|
|Daniel Andrews MP||Premier of Victoria||4 December 2014||Labor|
|Annastacia Palaszczuk MP||Premier of Queensland||14 February 2015||Labor|
|Mark McGowan MLA||Premier of Western Australia||17 March 2017||Labor|
|Steven Marshall MP||Premier of South Australia||19 March 2018||Liberal|
|Peter Gutwein MHA||Premier of Tasmania||20 January 2020||Liberal|
|Andrew Barr MLA||Chief Minister of the Australian Capital Territory||11 December 2014||Labor|
|Michael Gunner MLA||Chief Minister of the Northern Territory||31 August 2016||Labor|
|Mayor David O'Loughlin||President of the Australian Local Government Association||November 2016||Labor|
Australia is believed to be the first federation to have introduced a formal system of horizontal fiscal equalisation (HFE) which was introduced in 1933 to compensate States which have a lower capacity to raise revenue. Many federations use fiscal equalisation to reduce the inequalities in the fiscal capacities of sub-national governments arising from the differences in their geography, demography, natural endowments and economies. However the level of equalisation sought varies. In Australia, the objective is full equalisation.
Full equalisation means that, after HFE, each of the six states, the Australian Capital Territory and the Northern Territory would have the capacity to provide services and the associated infrastructure at the same standard, if each state or territory made the same effort to raise revenue from its own sources and operated at the same level of efficiency.
Currently the funds distributed to achieve HFE are the revenues raised from the Goods and Services Tax (GST), currently about AUD50bn a year. The distribution of GST required to achieve HFE is decided by the Federal Treasurer each year, on the basis of advice provided by the Commonwealth Grants Commission (CGC).
Achieving HFE does not mean that the states and territories are directed how to raise revenue or how to spend their funds. GST revenue grants from the Commonwealth are unencumbered and available for any purpose. Accordingly, HFE equalises fiscal capacity, not fiscal policies which remain for the states and territories to decide for themselves. It does not result in the same level of services or taxes in all states and territories, direct that the states and territories must achieve any specified level of service in any area, nor impose actual budget outcomes in accordance with the Commission's calculations.
At its meeting on 13 December 2013, COAG agreed to streamline the COAG council system and refocus on COAG's priorities over the next 12 to 18 months.
There are now eight COAG councils:
There is no longer a distinction between standing and select councils, as all councils are time-limited.
In 2012 a group of 20 environmental organisations released a joint communiqué denouncing the establishment of the COAG Business Advisory Forum and wanted wider representation on the Forum. The groups also opposed the weakening of environmental regulations.