I will make this clear. It is no simple matter. Similar ideas for statehood have been put forward in the past (for example in North Queensland) none are yet successful. However, there appears to be at least three potential ways this could be done:
1. Through the Victorian Parliamentary Process:
A referendum is held locally and then across Victoria. The current Victorian Parliament will need to be convinced to accept the will of the people (however, with the moral authority of the local referendum and support of our fellows across Victoria this sequence is possible) following which the Federal Parliament can approve the boundary changes with the new government to take effect 6 months later (for details of the referendum see the page "Constitution and Bill of Rights".) This is not unprecedented, this is the type of process by which the ACT was separated from NSW.
2. As a Sovereign People:
The process above - with a full state referendum - is a requirement if the State Parliament of Victoria wants to change its boundaries. Presumably the requirement of a full referendum for the State of Victoria is needed to restrict the powers of parliament. However, there may be an alternative of just holding a local referendum of the people in the new state. This would be legitimised by the right of people to determine their own future and forms of government (see also this document regarding the relative sovereignty of people versus the State government). In this case, following the local referendum, the State Government of Victoria would be notified of a date for the secession of the people of Mornington Peninsula State, and the new state would formed from that date. In this case, Mornington Peninsula state would be an entirely independent entity (a republic). In this case, a more complicated process would need to be determined to join the Federation under the provisions of Sec 121 to add new states (intended for New Zealand):
"New States may be admitted or established
The Parliament may admit to the Commonwealth or establish new States, and may upon such admission or establishment make or impose such terms and conditions, including the extent of representation in either House of the Parliament, as it thinks fit."
Admittedly this second way could be a rather complicated constitutional fight, as the Commonwealth Constitution restricts the ability of the Federal Government to change the boundaries of Victoria without the consent of the Victorian Parliament. However, one possibility is a national referendum on this issue. If many regional and rural communities across Australia were interested in more autonomy, this may be a feasible approach. This would bypass state governments and make the issue a national issue to be determined by all Australian citizens (not state parliamentarians who may have vested interests in preventing such change).
3. A Dependency
A national referendum might take some time, so there is a third way: a dependency - a self governing possession of the Australian Commonwealth. An example of this is the Isle of Man, which is an independent state under the protection of the British Crown. Following a local referendum to secede, the Mornington Peninsula State could become a dependency of the Australian Commonwealth along with a variety of treaties signed so as to get the benefits of federation without being a formal member state. Another way of thinking of this is that the independent state of Mornington Peninsula would effectively be creating an alliance whereby it effectively pays for services such as defence etc. to be provided by the Commonwealth of Australia (although Norfolk Island was supposed to be an independent protectorate, but this has been reneged on by the Australian government).
But let us not forget that this is OUR country - a democracy ruled by the will of the people - and the laws, even constitutions, are determined by the will of us, the people, not lawyers, bureaucrats and parliamentarians. These people are important, but they are servants and representatives of the people respectively, they are not unanswerable rulers!
However, currently any constitutional reforms at state or federal level require approval by parliaments so perhaps there is need for changes to our existing constitution? (Read Professor George Williams in relation to this)
One option for change is Swiss style democracy, where the signatures of 100,000 people can force a referendum. This constitutional change is discussed here.
To Transition to the new state the following process is suggested:
1. Complete one of the referendum processes above. 2. Statutes are prepared for approval by the new parliament. This statutes will create the government departments and determine their powers and responsibilities. These can be approved on the first sitting of parliament (eg: court system, education department, police, planning department, Health, State roads, State Electricity, State water, Education etc) with changes made as necessary in subsequent sittings. 3. Elections and election campaigning can continue within the 6 month period, with the new parliament taking control at the end of that period. 4.During the 6 month period, offers will be extended to existing council staff, hospital staff, police officers, teachers etc, offering them employment under the new statutes once passed by parliament. At the end of six month period, those who have accepted employment will commence with the State of Mornington as their new employer. 5. During the 6 month period a prospectus will also be put forward for the creation of a public bank (public banks allow funding for infrastructure at much lower costs than commercial banks, along with other community benefits - see "Funding" below). 6. Government funding will be primarily based on rates for land. There are a number of possibilities here, one is as follows:
Residential land is rated at a flat rate. Land used for, or connected with, commercial purposes will have a progressive rate depending on size of the land. Rates will include levies for specific purposes -that is to say that a rates notice might itemise the services it provides for as a relative proportion of the overall rates notice. It will therefore be clear how much each ratepayer is paying for education, health, law and order, etc. If the public feels that an area is underfunded (eg hospitals) then the rates for that service can be increased by parliament.
Similar ideas have been proposed in a report by the Prosper group of Australia. The Prosper press release describes this report as: "The Total Resource Rents of Australia report finds the complete removal of income, company and sales tax is possible by replacement with a tax on monopolies such as water trading, cyber squatting, taxi licenses and land."
Non-payment of Rates:
It is proposed that nobody be at risk of losing their land or other property through non-payment of rates. Rather residents will be given the opportunity to demonstrate whether they do in fact have the means or not. If they do not, some payment in kind might be proposed (eg: providing labour or materials in lieu of monetary rates). For those who do have the means and refuse to pay their names will appear on a public register which will be widely available. Obviously if sufficient numbers of people refuse to pay rates, services will need to be cut, or the costs passed on to those who are prepared to pay. These will be issues to be debated and dealt with by the parliament.
It may be that some groups of people prefer to provide services themselves rather than pay for them through rates. For example, the majority of residents in a street may choose to maintain the street themselves, and for this may be eligible for a rate reduction through negotiations with Government representatives. Similarly, some families may choose to run and fund their own schools (or home school) and this may also result in reduction of rates for these residents. If they should re-enrol in a state funded school, the rates would be re-applied.
Allowing citizens to organise to provide their own services and look after their own shared resources allows for stronger communities, which in the long term will be more resilient (as they rely less on external service providers), and provides a path back to management of local resources in a commons form. Management of commons by communities is the means by which shared resources were managed for eons, before centralised systems of control became predominant over the past several hundred years. Commons were the basis of a recent Nobel prize in economics:
"Elinor Ostrom [...] studied how people in small communities around the world managed common resources. Her research showed that when natural resources are pooled and have shared ownership, the rules for managing those resources evolves over time in a way both economically and ecologically sustainable. Elinor therefore believed that common pooled ownership of natural resources is better than privatization and government involvement. A prerequisite however being that decision-making be transparent and democratic."
Taking over Council and State of Victoria Services:
As most Victorian essential services have privatised retailers it is intended that electricity, gas, water and some sewerage will continue to be supplied by your existing service provider through the state of Victoria.
Land in Victoria, and most of Australia, is held as fee-in-simple. This means an absolute right to the land (it cannot be taken and sold in forfeit of not paying rates for example). Ratepayers of the new State of Mornington Peninsula would be agreeing to pay rates to the state, in return for a set of services, as determined by an act of parliament. Without such an agreement for fee-in-simple land holders the imposing of rates on land is questionable under law.
However, the new state may wish to enter into an agreement with the (illegitimate) council body-corporates to take over some debt loads in exchange for the transfer of any funds held as received from ratepayers for all or part of the 12 months (or prior) that have been paid by ratepayers. This will then be deducted from any new rates outstanding for the residents for the 12 months. The handling of debts and money transfers will need to be negotiated in the lead up the new parliament taking office.
The state may also take over any existing private service contracts in place with body-corporate councils such as waste collection, cleaning etc. Local council employees will be offered similar positions in the new state. These may be in any of the new government departments created by the new state.
Land Title Transfers
By default all land will revert to state ownership unless ownership of title is provided. A deadline will be set up for the presentation of Victorian Land Titles, along with Section 32 documents. In these cases a new title will be issued by the State of Mornington Peninsula. If you own a mortgage on a property your bank or lending institution will hold the title and should claim ownership. Should your bank or lending institution not claim or establish ownership by the Land Titles deadline, then residents may still be able to claim ownership in the subsequent process for non-titled claims. Under this second process title may be awarded where it can be shown that effective ownership was in place prior to the new constitution taking effect - for example if you were the registered rate-payer for a property. In this case, land will be awarded under a new fee-in-simple title and any prior or other existing claims to ownership of the land or title will be extinguished at the time of issue.
Licenses and Vehicle Registrations
A new registration plate for vehicles of residents of the State of Mornington Peninsula will be issued upon presentation of a current Victorian Registration Certificate or invoice. Non-registered cars will need to be presented for inspection. Custom plates held by former Victorians will be re-issued for the new state upon request (and verification) for a fixed fee. Licenses will also be re-issued by the new state upon presentation of a current valid Victorian license. New license holders will be tested and licenses granted by authorised officers of the State of Mornington Peninsula.
Where will parliament sit?
The first parliament of Australia was held in the Exhibition Buildings in Melbourne. Later parliament house in Canberra was built for this purpose. It is proposed that the parliament of the State of Mornington Peninsula be housed in the Frankston Mechanics hall until such time as a suitable building can be constructed either in Frankston or Mornington.
Apart from the rates and other funding described above, it is proposed that a Public Bank be created by the new state. The following is a description of how these banks benefit the community (taken from this article):
"The establishment of city, regional and state banks, such as the state public bank in North Dakota, permits localities to invest money in community projects rather than hand it to speculators. It keeps property and sales taxes, along with payrolls for public employees and pension funds, from lining the pockets of speculators such as Jamie Dimon and Lloyd Blankfein. Money, instead of engorging the bank accounts of the few, is leveraged to fund schools, restore infrastructure, sustain systems of mass transit and develop energy self-reliance."
The Public Banking Institute, founded by Ellen Brown, the author of “Web of Debt: The Shocking Truth About Our Money System and How We Can Break Free,” Marc Armstrong [who worked for IBM Finance] and other grass-roots activists are attempting to build a system of public banks. States such as Vermont and Washington and cities such as Philadelphia, Washington, D.C., San Francisco and Reading, Pa., have begun public banking initiatives. Public banks return economic power, and by extension political power, to the citizens. And because they are local they are possible."