What are we asking for?
Restoring Financial Assistance Grants to at least 1 percent of Commonwealth taxation revenue via a phased approach.
Why is it important?
The value of Financial Assistance Grants provided to local government has declined over the past three decades from around 1 percent of Commonwealth taxation revenue to around 0.55 percent.
Local governments only collect around 3.5 percent of taxation nationally and need support from other spheres of government to provide and maintain the infrastructure their communities need such as swimming pools, playgrounds, sports facilities, regional airports, and roads.
ALGA’s 2021 National State of the Assets report indicates that around 10 percent of the infrastructure owned and managed by Australian councils is in poor condition and requires intervention.
Financial Assistance Grants are particularly valuable for local government, as the funding is untied, meaning it can be spent where it is most needed. This can include building new infrastructure, delivering new programs that meet community needs, as well as maintaining local pools, libraries, sporting grounds and roads.
Untied funding provided to councils also enables them to invest in their workforces, through bringing on new staff or upskilling or retraining existing employees, helping address Australia’s workforce capacity challenges.
How would it support our communities?
The South Burnett Regional Council had its Financial Assistance Grants cut by $500,000 a year in December after the Queensland Local Government Grants Commission changed its allocation methodologies.
South Burnett Mayor Brett Otto said he had major concerns about the impact and outcome of the cuts on the local community.
“As a rural regional council, our region is already under a lot of stress,” he said.
“We have 3200 kilometres of road network to maintain, a large number of parks, compliance services, mental health support and local disaster management services that are all provided by the council,” he said.
“We can only cut costs so far, we don’t want to impact services in our region,” he said.
Mayor Otto said the funding cuts underlined the need for more sustainable untied funding from the Commonwealth.
“Despite ongoing cost-cutting, regional councils like ours are on the edge of a financial cliff,” he said.
“We are obligated to deliver an increasingly broad scope of community services, without recognition of such by the Commonwealth through an appropriate level of untied funding.”
