OPINION: Queensland father of four Ron Williams undertook a David versus Goliath battle when he challenged the National School Chaplaincy Program in the High Court. He did so because he believed funding for chaplains in state schools breached the separation of church and state.
This line of attack failed, but he succeeded in having the funding struck down because it breached a different set of principles. The High Court recognised that the scheme ran counter to the federal character of Australia's system of government and the notion that the expenditure of money should be subject to parliamentary oversight.
Hundreds of millions of dollars of federal funding have been provided for chaplains in schools across Australia. Williams argued this breached the requirement in section 116 of the constitution that ''no religious test shall be required as a qualification for any office or public trust under the Commonwealth''.
Predictably, this argument failed. The judges did not need to look at the issue of whether a religious test was involved because school chaplains do not have a contractual or other arrangement with the federal government and so do not hold ''office under the Commonwealth''.
Williams had a back-up argument, and it was a strong one. He relied upon the High Court decision of Pape, which in 2009 very nearly struck down the Rudd government's $900 cash stimulus payment. Although Bryan Pape lost that case, he demolished the long-held assumption that the Commonwealth can spend money in whatever area it wishes. Instead, the court held that the Commonwealth can spend money only in areas in which it has legislative or executive power.
The chaplaincy program is one of many federal programs that provide funding according to a set of government guidelines rather than legislation enacted by Parliament. This meant the program relied upon the Commonwealth's executive power.
In a major blow to the Commonwealth, the High Court gave this executive power a surprisingly narrow reading. It held that the power does not support spending of this kind, and if the payments are to be made at all, they must be supported by legislation.
The problem for the government is that it is not clear that this type of scheme can be supported by legislation. The Federal Parliament can pass laws only in certain areas, and has no general power over education.
The only certain path by which the Commonwealth can restore the chaplaincy program is to channel the funding through the states using section 96 of the constitution. However, the states would have to agree to receive the money for this purpose, and the government will be wary about building the states and their bureaucracies into the scheme.
The decision of the High Court is narrow in the sense that it struck down only school chaplaincy funding. However, in doing so, the court addressed fundamental principles about the scope of federal power that affect a broader range of Commonwealth arrangements.
A variety of federal schemes have been on shaky ground since the High Court decision in Pape. The Commonwealth had undoubtedly been hoping the Williams case would resolve matters in its favour. Instead, the High Court has imposed even more stringent limits.
This decision will force the federal government to go back to the drawing board in considering what programs it funds and how it does so. Unless it does this as a matter of priority, others could be emboldened to bring further challenges.
Direct federal funding of local government, including the Roads to Recovery program, continues to be subject to considerable doubt. The Commonwealth might also be on vulnerable ground in the education sector generally. Questions can be raised about direct federal funding of private schools and universities. Support for some community groups, the arts and sports might also be an issue.
Williams did not win a victory on the ground of separation of church and state, but did achieve a major win for the states. Chief Justice French in particular emphasised how the power to spend should be read in light of the creation by the constitution of a ''truly federal government''.
The result of the case could be major, long-term changes in how federal funding programs are undertaken. It is likely to mean that the Commonwealth will spend more money via the states. Although this emphasises the federal character of the constitution, it will come at a cost of enormous complexity and uncertainty.
George Williams is a Professor of Law at UNSW.
This opinion piece first appeared in The Sydney Morning Herald