Australia is part of the Commonwealth group of countries and once came under the direct rule of Britain. It is now an independent country, although the British monarch remains the head of state. The country has a governor general who is a direct link to Britain and each state also has a governor appointed by the Queen. Each state has its own regional government and the six areas of Australia joined together to form one country in 1901. Each state is headed by the leader of the party that has the majority in the lower house of the state government.

Australia is a democracy and has a written constitution. This was first drawn up in the 1890s and each of the states ratified it in turn. The constitution gives the government power over taxation, defence, foreign policy, pensions, immigration and a number of other services. Each state has their own powers over regional matters. Changes can only be made to the constitution if each house of the Federal Parliament caries out a national referendum. The referendum results must give them an overall majority in a minimum of four of the states. Since 1901, only 8 suggestions for changes to the constitution have successfully gone through this procedure.

The Federal government has a House of Representatives consisting of 147 members who represent all states and territories of the country. The Senate has 12 representatives from each state and 2 representatives from each territory. The Senate members are elected through a proportional representation system. The party which earns a majority in the House of Representatives provides ministers from its members in both houses and the Prime Minister will be a part of the House of Representatives. The main parties are the Australian Labour Party, the Liberal Party and the National Party. Elections are conducted for the House of Representatives every three years but can be moved forward with the permission of the Governor-General. Each minister will have his own department and will often work closely with other ministers.

Australia has a system of compulsory voting and there is an electoral commission in place to ensure that elections are fair. If you are 18 or over you need to vote or you must have a valid reason for not voting. There are penalties for those who do not vote. This is $20 in the first instance but if you still fail to provide a good reason for not voting then this will be increased to $50 if the matter has to be dealt with in court. Voters must be Australian citizens or a British citizen who appeared on an electoral roll in 1984. You must have lived at your Australian address for a minimum of one month. Those who are 17 when an election date is announced but expect to be 18 by the time that the election takes place can register to vote in advance to ensure that they receive all the relevant paperwork in time.

Australia has a strong economy that is mainly services and mining based. It is the 13th largest economy in the world and exports agricultural produce all over the world. Australia survived the economic downturn relatively unscathed and there are forecasts that the economy will continue to grow for the next few years. The country has large deposits of various minerals and precious stones and the country is famous for opals and sapphires. The economy is also helped by the fact that it has a relatively small population of around 22 million people yet the country is blessed with vast natural resources. The economy is also helped by a strong demand for housing with many expats deciding to make a new life in the country.

Inflation in December 2010 stood at 2.65%, a fall of 0.13% from the previous quarter. Inflation has always fluctuated in the country. The highest rate recorded was in 1975 when it reached 17.60% and a low of -0.30% in 1997. Interest rates have also fluctuated in Australia and in March 2011 stood at 4.75%. This is set by the Reserve Bank of Australia’s Board. In April 2009 interest rates dropped to 3%, but over the years the rate has been an average of 5.8%.