The Australian Constitution established a federal system of government where both federal and state levels of law-making are recognised. The Constitution makes no mention of a local level of government and this remains the situation today.
There was a proposal to change the Constitution to formally recognise local government in 1988, and the question was presented to Australian electors in a referendum. Voters overwhelmingly rejected the proposal with every state and territory voting ‘No’. Without the necessary majorities, the Constitution was not changed.
However, when an aspect of government is not mentioned in the Australian Constitution it does not necessarily make it unconstitutional. This is the case with local government. Each Australian state has its own constitution and is able to make its own laws. While the states’ powers vary across Australia, every state has a Local Government Act that provides the rules for the creation and operation of councils. In general, these Acts cover how councils are elected and their power to make and enforce local laws, known as by-laws. In this way, we have a third level of law-making in Australia.