This article challenges dominant perceptions of Commonwealth centralisation in Australia's federal system. While recognising the Commonwealth has entered a range of policy fields not anticipated by federal founders, it argues this does not equate to a generalised unidirectional and hierarchical orchestration of state/territory functions. The crucial case of mental health policy is presented as an alternative scenario in Australia's federal experience. Theoretically key challenges from the multi-level governance literature are proffered against the centralisation thesis. These include queries about the origins of Commonwealth directives and assumptions of zero-sum notions of state/territory autonomy. Brief empirical analysis highlights the role of the Commonwealth as a conduit of horizontal and vertical flows of knowledge through the national mental health policy agenda. Given disconnect and diversity between national ambitions and their realisation at state/territory level, it is argued better proceduralisation through bottom-up peer dialogue and feedback present alternative routes towards decentralised integration.