Roads Funding

Transport and infrastructure are significant areas of expenditure for all councils. In 2018-19, councils spent $8.3 billion on transport, primarily on roads. While some funding is provided by the Australian and state/territory governments, roads are primarily funded from the council’s rate base.  In 2018-19 Councils collectively collected $18.9 billion in rates.

Unlike other levels of government, Local Government has no direct mechanisms to raise funds for road construction and maintenance such as road user charges, registration charges, or any road- or transport-related fees or charges

Local government owners of transport infrastructure face multiple and competing demands on their limited financial resources. Rate payers are often left to fund transport networks for non-ratepayers particularly where local roads provide for significant arterial and through traffic or have economic significance beyond the access interests and responsibilities of the council.

While local roads are primarily funded by councils, and therefore local ratepayers, federal funding is essential for local government to provide the local infrastructure and services the community needs. To assist councils, the Commonwealth Government provides three important programs:

  • Roads to Recovery Program
  • Bridges Renewal Program
  • Black Spot Program


Introduced in 2001, the Roads to Recovery Program (R2R) is essential to help councils address the maintenance backlog on local roads. R2R is a true partnership between the Commonwealth Government and local government. This funding is greatly valued by all councils and their local communities.

The Commonwealth Government will have provided $6.2 billion funding to local councils under R2R between the 2013-14 financial year to the 2023-24 financial years. In the 2020 calendar year an additional $138.9 million was provided to the 128 Local Government Areas eligible for the Drought Communities Programme Extension.

However, an ALGA study released in 2010 into local road funding estimated that to simply maintain, rather than improve Australia’s local roads up to 2025, an addition $1.2 billion annually is required.

Without this additional funding, underinvestment in local roads will continue. This funding shortfall hinders local and regional social and economic development, and ultimately affects the development and productivity of the nation.

ALGA has called for the federal government to increase R2R funding to $800 million per annum.


The 2015 State of the Assets report shows that councils own timber bridges worth $1.71 billion, 22% of which were in poor or very poor condition. The 2018 State of the Assets report showed little improvement with 21% of timber bridges in poor to very poor condition despite investment by local councils and the introduction of the Australian Governments Bridge Renewal Program in 2015-16.

This program is aimed at helping councils to upgrade or replace local bridges, especially timber bridges. The Australian Government is providing $640 million from the 2015-2016 financial year to the 2022-2023 financial year, with an on-going commitment of $85 million each following.

ALGA strongly welcomed the much-needed bridge renewal program. Given the magnitude of the task facing councils to manage this infrastructure, ALGA believes the Commonwealth Government should make the Bridges Renewal Program permanent to allow greater productivity and safety benefits to be realised.


The Black Spot Program is part of the federal government’s commitment to reduce crashes on Australian roads. Road crashes are a major cost to Australians every year and Black Spot projects target those locations where crashes are occurring to reduce the risk of crashes.

The Australian Government has committed $1.0 billion to the Black Spot Program from 2013-14 to 2022-23-with an on-going commitment of $110 million each year following. This program has proved very effective, saving the community many times the cost of the relatively minor road improvements that are implemented.

The Black Spot Program makes an important contribution in reducing the national road toll under the National Road Safety Strategy and Action Plan.