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National fiscal consolidation and the challenge to Australian federalism

Published online by Cambridge University Press:  01 January 2023

Neil Warren
Neil Warren*
Affiliation:
The University of New South Wales, Australia
*
Neil Warren, School of Taxation and Business Law, Australian School of Business, The University of New South Wales, Sydney, 2052, NSW, Australia. Email: n.warren@unsw.edu.au
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Abstract

Following failure of the stimulatory policies post the 2008 financial crisis and the resulting instability of the Euro, national fiscal consolidation with real sanctions for non-compliance has become a key focus of most governments as they address escalating budget deficits and rapidly rising public debt. The problem is that agreement by central governments to adopt national fiscal rules, whether self-imposed or imposed by some supranational institution, leaves unaddressed how such rules and sanctions should be adopted by (or imposed on) sub-central and local governments. To date, the primary focus has been on whether the encouragement given over recent decades to fiscal decentralisation has worsened public debt levels and made national fiscal consolidation by central governments more difficult. This article argues that what is missing from this discussion is attention to the intergovernmental institutional arrangements and how they and their reform are potentially crucial to both national fiscal consolidation and ensuring retention of the benefits of fiscal decentralisation.

Keywords

H62H63H77Federalismfiscal consolidationfiscal decentralisationfiscal rulespublic debt
Type
Symposium Articles
Information
The Economic and Labour Relations Review , Volume 24 , Issue 2 , June 2013 , pp. 161 - 180
Copyright
© The Author(s) 2013

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