By JR on Saturday, June 04, 2011
But if it leads to distrust of Greenie policies, that may be a price worth paying
The rule of law stands as a bulwark against the arbitrary exercise of power by government. As such it is fundamental to fairness, the freedom of the governed, and the success of the liberal market economy – but it is frequently under attack, sometimes from unexpected quarters. Two recent examples spring to mind.
Retrospective legislation is antithetical to the rule of law. It is like changing the rules of the game after it has been played. But governments sometimes resort to it, citing extraordinary circumstances as the justification.
The freshly minted O’Farrell government in NSW is planning to tear up contracts entered into by its predecessor, which had promised to pay participants in the solar energy scheme a very generous 60 cents per kilowatt hour for electricity generated (the ‘feed-in tariff’). It plans retrospective legislation to invalidate the old contracts, cut the price paid, and deny participants in the scheme any legal recourse against the government.
The solar scheme was an atrocious act of public policy, adopted by the previous government in the expectation that the nasty fiscal consequences would be someone else’s problem.
But can an action of one government be so bad that it justifies retrospective legislation by a successor government? Opinions will differ on this, but the avoidance of retrospectivity is such an important principle that the justification should be very strong indeed, and in my opinion stronger than in this case.
The above is a press release from the Centre for Independent Studies, dated 3 June. Enquiries to firstname.lastname@example.org. Snail mail: PO Box 92, St Leonards, NSW, Australia 1590.