Australia has three levels of government: federal (national laws and services), state/territory (schools, hospitals, roads), and local (councils managing parks, rubbish, local planning). Understanding each level's responsibilities is a key topic in the Australian Citizenship Test.
Australia's three levels of government are federal, state/territory, and local. Each level has its own responsibilities, elected representatives, and areas of law-making power. According to the Department of Home Affairs, questions about government structure appear regularly in the Australian Citizenship Test, particularly in the "Government and the Law" category.
If you can clearly describe what each level of government does and who is responsible for what, you'll be well prepared for this section of the test.
Level 1: Federal Government (Commonwealth)
The federal government, also called the Commonwealth Government, is the national government of Australia. It was formed in 1901 when the six colonies federated to become one nation. The federal government has the power to make laws that apply to the whole country.
What Does the Federal Government Do?
- Defence — the Australian Defence Force, military policy
- Immigration and citizenship — visas, border control, citizenship applications
- Social security — welfare payments, aged care, disability support
- Medicare and health funding — national health insurance scheme
- Foreign affairs — treaties, embassies, international relations
- Trade and commerce — national and international trade laws
- Taxation — income tax, GST (Goods and Services Tax)
- Currency — the Australian dollar
The federal parliament sits in Canberra, the Australian Capital Territory (ACT). It consists of two houses: the House of Representatives (lower house) and the Senate (upper house). The leader of the federal government is the Prime Minister.
Level 2: State and Territory Governments
Australia has 6 states and 2 territories. Each has its own parliament and government that manages services most directly affecting everyday life. State and territory governments existed before federation — when Australia federated in 1901, the states kept many of their original powers.
The 6 States and 2 Territories
- States: New South Wales (NSW), Victoria (VIC), Queensland (QLD), South Australia (SA), Western Australia (WA), Tasmania (TAS)
- Territories: Australian Capital Territory (ACT), Northern Territory (NT)
Note: the territories have slightly different arrangements to states and their governments can have their laws overridden by the federal government in some circumstances.
What Do State and Territory Governments Do?
- Schools and education — public schools, TAFE, curriculum
- Hospitals and health services — public hospitals, ambulances
- Roads and transport — state roads, trains, buses
- Police — each state and territory has its own police force
- Land management — public land, national parks, environment
- Housing — public housing, planning and zoning laws
- Emergency services — fire brigades, SES
Each state parliament is led by a Premier, while territory governments are led by a Chief Minister.
Test yourself on government structure
Practice questions covering all three levels — know exactly what each level does before test day.
Start Practice QuizLevel 3: Local Government (Councils)
The third level is local government, made up of city councils, shire councils, and municipal councils. There are approximately 537 councils across Australia. Local government is the closest level of government to residents' daily lives.
What Do Local Councils Do?
- Rubbish collection and recycling
- Local roads, footpaths, and parks
- Libraries and community centres
- Local planning and building approvals
- Pet registration
- Local sporting facilities
- Drainage and stormwater management
Local councils are governed by elected councillors, led by a Mayor (or Shire President in some areas). Local councils raise revenue through rates — fees charged to property owners.
How the Three Levels Work Together
While each level has distinct responsibilities, many areas involve cooperation between levels. For example:
- Health — the federal government funds Medicare; state governments run public hospitals
- Education — states run public schools; the federal government provides significant funding and oversees universities
- Roads — local councils manage local streets; states manage state highways; the federal government funds major national highways
- Disaster response — local emergency services respond first; states coordinate the response; the federal government may deploy the military or provide financial assistance
The Australian Constitution sets out which powers belong exclusively to the federal government, which are shared with the states, and which are state-only. Where a conflict arises between federal and state law, federal law prevails.
Comparison Table: Three Levels of Government
| Feature | Federal | State/Territory | Local |
|---|---|---|---|
| Leader title | Prime Minister | Premier / Chief Minister | Mayor / President |
| Parliament location | Canberra (ACT) | State/territory capital | Local council chambers |
| Key areas | Defence, immigration, Medicare, tax | Schools, hospitals, police, roads | Rubbish, parks, local planning |
| Revenue source | Income tax, GST | State taxes, federal grants | Council rates, fees |
| How many? | 1 | 8 (6 states + 2 territories) | ~537 councils |
Why This Topic Appears on the Citizenship Test
Questions about government structure test whether you understand how Australia is governed as a democracy. The Australian Citizenship Test regularly asks questions such as:
- "Which level of government is responsible for schools?"
- "Who controls Australia's defence forces?"
- "What does local government provide?"
- "Where does the federal parliament meet?"
- "How many states does Australia have?"
Knowing the specific responsibilities of each level — not just the names — is what allows you to answer these questions with confidence. Use the Study Guide and practice tests to lock in these facts before your test day.
Frequently Asked Questions
How many levels of government does Australia have?
Australia has three levels of government: federal (Commonwealth), state and territory, and local government. Each level has distinct responsibilities and elected representatives.
What is the difference between a state and a territory in Australia?
States have more constitutional powers and cannot have their laws easily overridden by the federal government. Territories (the ACT and NT) were created by the federal government and can, in some circumstances, have their laws overridden by the federal parliament. Both have their own elected governments.
Who is the head of the federal government in Australia?
The Prime Minister is the head of the federal government and leader of the party or coalition with a majority in the House of Representatives. The Prime Minister advises the Governor-General, who represents the King as Australia's head of state.
Are local councils mentioned in the Australian Constitution?
No. Local government is not mentioned in the Australian Constitution. Local councils are created by state and territory governments and operate under state legislation. This is why local government structures vary slightly between states.
What is the most powerful level of government in Australia?
The federal government is the most powerful because it has exclusive control over defence, immigration, and currency, and federal law overrides state law when they conflict. However, states retain significant independent powers particularly in education, health, and policing.