Councils to boost national economy by $7 billion with sustainable funding

Local governments could boost Australia’s Gross Domestic Product (GDP) by up to $7 billion per year and create more liveable communities if councils were sustainably funded by the Federal Government, a Parliamentary Committee was told today.

New research, due to be released by ALGA next week, shows a $1 billion annual investment in local government roads would increase Australia’s GDP by $3.5 billion per year, and an extra $350 million for parks and open space could increase GDP by $900 million per year.

ALGA highlighted the research while appearing at a House of Representatives inquiry into local government sustainability, along with a number of key reforms to show how local communities could grow and thrive with more federal funding and better partnerships in the future.

President Cr Linda Scott said: “With extra responsibilities being forced on to Australia’s 537 councils every year, we highlighted a range of solutions to consider and address the financial challenges and funding shortfalls currently faced by local governments.

“This inquiry presents a valuable opportunity to outline the value and services we are delivering in our communities and to highlight the much-needed funding reforms local government needs to be sustainable.”

As part of its comprehensive, evidence-based submission to the inquiry, ALGA made five key recommendations to the committee, with the number one priority being increasing untied Financial Assistance Grants for local government to at least one per cent of Commonwealth taxation revenue.

Cr Scott said the best way to support increased efficiency and productivity in Australia was increasing federal Financial Assistance Grants so councils get our “fair share” of national tax revenue.

“ALGA’s research shows over the past decade local government expenditure per capita has flatlined, while spending by other levels of governments has continued to rise,” Cr Scott said.

“We are committed to partnering with the Commonwealth, and state and territory governments, to facilitate more affordable housing, better prepare for natural disasters, and deliver on our national emissions targets, but we can’t do this without greater support.”

Read ALGA’s submission to the national local government inquiry.

Photo caption: (L-R): ALGA President Cr Linda Scott, Chair of House of Representatives Standing Committee on Regional Development, Infrastructure and Transport Luke Gosling MP and ALGA CEO Amy Crawford at Parliament House.