The Grattan Institute has revealed new research at ALGA’s 2023 National Local Roads, Transport and Infrastructure Congress, stating that federal funding to local governments isn’t keeping up with rising construction costs. 

The preliminary research was revealed by the institute at the congress, held on 6-7 September, in Canberra.

ALGA President, Linda Scott, said councils collectively manage around 75 percent of Australia’s road network by length, while collecting less than four percent of national taxation.

“Our first keynote presentation at this year’s Congress was delivered by Natasha Bradshaw from the Grattan Institute, who presented preliminary results from their research into local road funding,” Cr Scott said.

“The research shows that over the past 20 years federal Financial Assistance Grants have failed to keep pace with the rising costs of constructing and maintaining roads.

“Soaring construction costs are also eroding the buying power of Roads to Recovery funding, which is not indexed to account for inflation, meaning councils are constrained in the roads they can fix and maintain.

“The Grattan Institute’s preliminary findings also confirm regional, rural and remote councils face additional and sometimes insurmountable difficulties, due to smaller ratepayer bases, larger geographical areas, and less staff.

“In fact, the cost per person to maintain sealed roads is up to five times higher in regional and remote communities compared to metropolitan areas.”

Ms Bradshaw’s keynote presentation was followed by a panel discussion which also included ALGA Vice President and Gladstone Mayor, Matt Burnett, and IPWEA NSW and ACT CEO and former New South Wales Transport Minister, David Elliott, which covered the issues of road funding, congestion and natural disasters.

Cr Scott said that the ALGA looks forward to the official release of the Grattan Institute’s findings and recommendations in late 2023, and that it will continue to advocate for the funding local governments need to deliver and maintain safer local roads for their communities. 

“Increasing Financial Assistance Grants to at least one percent of Commonwealth taxation revenue is vital to enable all councils to maintain our local roads to a better, more resilient standard.

“We also want to see the Federal Government’s Roads to Recovery funding increased from $500 million to $800 million per year, and this funding indexed annually to keep pace with rising construction costs.

“ALGA’s recent analysis estimated the cost of flood-damaged roads in Queensland, New South Wales, Victoria and South Australia is in the vicinity of $3.8 billion, so we need urgent support from all levels of government to fix these roads as soon as possible and help us build them back better.”


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