It says we are a colony.
Australia's current flag (a defaced British Blue Ensign - because it is based on the British Royal Naval Ensign), was never actually chosen by the Australian people in a popular vote. King Edward VII approved the design after it was selected in a competition that only considered proposals which featured the Union Jack.
King Edward VII gave royal assent to the Australian flag
When the new design was announced in 1901, it was poorly received by the wider Australian public. This was the time of Federation, when Australia found strength in the unity of its 6 founding states, and its economy and its population were booming. The idea of Australia having a separate national identity to that of the motherland (Great Britain) was gaining traction. Popular magazine The Bulletin described the design as "a staled réchauffé of the British flag, with no artistic virtue, no national significance" and a "Bastard flag". Even the Prime Minister at the time, Chris Watson (of the Labour party, as it was then known) disliked the flag and wanted to delay adoption of a national flag until a more suitable design could be found.
The Blue Ensign which won the design competition in 1901
So if it's accepted that the Blue Ensign was poorly conceived of and not well received by Australians - then how did it stick?
Quite simply, it is because no popular alternative has appeared - and inertia set in.
There was actually some confusion around whether the Red Ensign or the Blue Ensign was Australia's official National flag, up until 1950, when Prime Minister Robert Menzies proclaimed the Blue Ensign as the National flag. Monarchists and those loyal to the British Empire took measures to ensure the flag became entrenched.
On the other hand, debate on choosing a new national flag continued among Republicans over the years. Various competitions were held with the objective of identifying and then popularising an alternative national flag, although none successfully. Prime Minister Paul Keating is quoted as saying "I do not believe that the symbols and the expression of the full sovereignty of Australian nationhood can ever be complete while we have a flag with the flag of another country on the corner of it."
More recently, Labour Member of Parliament Tim Watts spoke out about the need for a new Australian flag, stressing the importance of a national symbol in reflecting a nation's identity. Watts argues that Australia needs a new flag which represents the "modern, multicultural, Southeast Asian nation we have become".
Apart from its flawed inception, what are the other criticisms of the existing Australian flag (the Blue Ensign)?
There are many flags around the world, belonging to various countries, states, principalities (tiny islands), yacht clubs, fire brigades, etc. which share a design similar to Australia's current flag - that is, they feature the British Union Jack in the top left corner (often referred to as the flag's Canton).
Australia's and New Zealand's flags are often confused
The flag which shares most in common with Australia's flag, is New Zealand's. The two flags are often confused.
Australia has come a long way since the days of the White Australia policy (actually a collection of policies, not one specific policy per se), which actively limited non-British immigration and virtually prohibited non-White immigration to Australia. With the embrace of modern, multicultural, pluralist policies beginning in the 1970s, Australia is now a very different nation.
Australia abolished the racist White Australia policy but kept its colonial flag
The White Australia policy was effectively ended in 1973 by the Whitlam government. Since then, Australia has maintained a large-scale immigration program that does not discriminate on the basis of race or religion.
Over the years, many proposals for a new Australian flag have been put forward. Some advocates for changing the flag have also proposed the Eureka flag (which actually predates Federation, having been first flown in 1854). In addition to the Eureka flag, several other popular designs are shown below:
The Eureka flag, 1854
All Australian Flag, by Athol Kelly, 1979
Sam Neil's design, 1997
Southern Cross and Boomerang, Fred Rieben, 2004
An Ausflag proposal from 2013
The Eureka flag is a popular alternative Australian flag, and lays claim to being one of Australia's oldest symbols (if not the oldest) - having been the flag used by gold miners rebelling against British colonial authority in Ballarat, Victoria. The miners were objecting to the expense of the miner's license, and taxation on miners without representation, being enforced by the colonial government.
While it is a proud and enduring symbol with historical significance to Australia, there are several good reasons why it has not become Australia's national flag:
As for the other flags, criticisms include: