The Council of Australian Governments (COAG) was the primary intergovernmental forum in Australia from 1992 to 2020. Comprising the federal government, the governments of the six states and two mainland territories and the Australian Local Government Association, it managed governmental relations within Australia's federal system within the scope of matters of national importance. On 29 May 2020, Prime Minister Scott Morrison announced that COAG would be replaced by a new structure based on the National Cabinet implemented during the COVID-19 pandemic. History COAG grew out of the Premiers' Conferences, which had been held for many decades. These were limited to the premiers of the six states and the Prime Minister. A related organisation is the Loan Council, which coordinates borrowing by the federal and state and territorial governments of Australia. COAG was established in May 1992 after agreement by the then Prime Minister (Paul Keating), premiers and chief ministers, and it first met in December 1992. It was chaired by the Prime Minister. It met to debate and co-ordinate government activities between the federal and state or territorial governments and between the state and territorial governments themselves as well as issues affecting local government. COAG differed from the United States' National Governors Association or Canada's Council of the Federation, because these bodies only include state/provincial representatives, whereas COAG also included federal and local representatives. At a COAG meeting on 13 March 2020, it was announced that a new National Cabinet was being formed of the Prime Minister and the premiers and chief ministers of the states and territories to coordinate the response to the COVID-19 pandemic in Australia. On 29 May 2020, Prime Minister Scott Morrison announced that COAG would be replaced by a new structure based on the National Cabinet. Final membership COAG and state finances Australia is believed to be the first federation to have introduced a formal system of horizontal fiscal equalisation (HFE) which was introduced in 1933 to compensate States which have a lower capacity to raise revenue. Many federations use fiscal equalisation to reduce the inequalities in the fiscal capacities of sub-national governments arising from the differences in their geography, demography, natural endowments and economies. However the level of equalisation sought varies. In Australia, the objective is full equalisation. Full equalisation means that, after HFE, each of the six states, the Australian Capital Territory and the Northern Territory would have the capacity to provide services