The Federal Government has released its Budget 2023-24, which has been welcomed by the ALGA and Australian councils as a solid investment in local government.
As outlined in the budget, which was released on 9 May 2023, councils are set to receive $3.1 billion in Financial Assistance Grants over the next twelve months – however, funding for some initiatives was notably absent.
ALGA President, Cr Linda Scott, said, “For Australia’s 537 councils, $3.1 billion of local government funding is a vital investment in Australia’s productivity, allowing us to employ nearly 200,000 Australians and provide local services in every corner of the nation.
“However, it’s disappointing that another Federal Budget has passed without the Government delivering on their pre-election promise of ‘fair increases’ to these grants. Local governments will continue to work with the Government to see this happen, returning local government funding to at least one percent of Commonwealth taxation revenue.
“Our local roads are in a state of significant disrepair, with increasingly frequent natural disasters as a result of dangerous climate change.
“ALGA welcomes the $500 million in local road funding, and will continue to advocate for a significant increase to the Roads to Recovery Program that will support all councils to build better, more resilient roads.”
The budget includes funding of $236 million over the next ten years for rain gauges, with work in Queensland prioritised for the upgraded network to be overseen by the Bureau of Meteorology for operation and maintenance.
The Local Government Association of Queensland (LGAQ) has welcomed the funding – but also stated that other critical funding has been cut, vanished or ignored.
LGAQ Chief Executive Officer, Alison Smith, said, “As Australia’s most natural disaster-prone state, Queensland needs to have the best possible warning system.
“As the closest government to communities, councils play a critical role providing community services and welcome this increased support for vulnerable Australians.”
The LGAQ said councils were disappointed that Federal Assistance grants had again been cut as a percentage of tax revenue. It labelled the move a ‘clear failure’ by the Federal Government to deliver fair funding to communities by restoring FA grants to one per cent.
“The Budget has cut Federal Assistance Grants to councils from 0.52 percent to 0.5 percent,” Ms Smith said.
“Communities are getting less of their fair share and it is ratepayers who will be left to pick up the tab.
“Fair funding is the Federal Financial Assistance Grants restored to one percent of national taxation – just like they used to be 20 years ago.
“The Federal Government’s failure to restore FA Grants to the one percent of tax revenue so desperately needed by councils will significantly hurt communities across Queensland.”
Funding for the critical Local Roads and Community Infrastructure Program (LRCIP) will also not be renewed and phased out in 2026-27. It follows the Federal Government’s decision to exclude some councils from the latest round and to cut community infrastructure.
Cr Scott said local governments would miss the LRCIP.
“Established in 2020, the LRCIP has been successful in helping all councils deliver much-needed local infrastructure projects, including libraries, community sporting fields, local roads, parks and playgrounds,” Cr Scott said.
“The demise of the LRCIP will be partially offset by two new urban funding programs – a $200 million Thriving Suburbs Program and a $150 million Urban Precincts and Partnerships Program –alongside the Growing Regions and Regional Precinct Funds.”
“Local governments successfully advocated for the establishment of the $200 million Disaster Ready Fund, to enable us to invest to better prevent damage from natural disasters. Councils are delighted to see the Disaster Ready Fund continued, along with new Flood Warning Infrastructure Network Remediation, allowing councils to better protect our communities from flooding and other natural disasters in the future.
“ALGA also welcomes the extension of the Remote Airstrip Upgrade Program, a new $10 million National Waste Education campaign, as well as an extension of $20 million per year supplementary road funding for South Australian councils disadvantaged by the national local roads funding formula.”
The LGAQ also welcomed the Federal Government’s $83.2 million over four years for a legislated Net Zero Authority to coordinate communities’ transformation to a low carbon economy as well as spending on marine infrastructure in the state’s far north.
However, the LGAQ also said that “While funding for housing and cost of living measures included in the Budget are welcome, it was disappointing that calls for much-needed funds to ease overcrowding and Close the Gap in Queensland’s Indigenous communities have again fallen on deaf ears.”
MAV: more is needed
Municipal Association of Victoria (MAV) has acknowledged the Federal Government’s recent efforts to understand the challenges of local government, but said the budget does not deliver the boost required.
MAV stated in a media release on 11 May that the “ biggest piece of the Federal Budget puzzle for councils is Financial Assistance Grants, and while the MAV acknowledges the grants will deliver $746 million across the state, we look forward to the delivery of Labor’s election commitment for ‘fair increases’ in future budgets”.
MAV President, Cr David Clark, said roads funding is a huge issue for Victoria specifically.
“After the floods last year councils across the state are dealing with severe damage and increasing demands on maintenance and reconstruction. The funding for flood warning infrastructure is welcomed, but there’s a roads funding gap for Victorian councils in the order of $300 million,” Cr Clark said.
The re-direction of the final stage of Local Roads and Community Infrastructure Program (LRCIP) to local roads is recognition of this problem, with Victoria’s share around $50 million.
“LRCIP has delivered much needed infrastructure for communities across Australia and the loss of the program will create significant challenges for community infrastructure like drainage, playgrounds and other public use facilities. This will particularly hit resource constrained councils hardest,” Cr Clark said.
Cr Clark cautiously welcomed new funds through the Thriving Suburbs and Urban Precincts and Partnerships Programs, but noted previous competitive grant-based programs like this were the subject of political interference, not fair process.
“Local Government as a whole is much better served with LCIRP-style programs where councils have an allocated funding amount to spend on priorities already agreed within the community, rather than needing to dream up ‘winning’ bids,” Cr Clark said.
