A Victorian parliamentary inquiry wants the state government to advocate for a greater proportion of Commonwealth revenue to be allocated for councils.
The inquiry into Commonwealth Support for Victoria conducted by the Legislative Assembly Economy and Infrastructure Committee noted that councils in regional and rural Victoria rely heavily on Commonwealth Financial Assistance Grants to provide services and infrastructure due to higher delivery costs and lower capacities to raise revenue than metropolitan councils.
“A three-year indexation freeze on Financial Assistance Grants from 2014–15 has eroded the value of these grants and the Victorian Government should continue to seek greater Commonwealth support for local government to compensate,” the report said.
The recommendation was in line with one put to the inquiry by the Municipal Association of Victoria (MAV).
In its submission to the inquiry, the MAV urged the Victorian Government continue to advocate to the Commonwealth to increase the quantum of Financial Assistance Grants and to reverse the impacts of previous freezing of indexation
Restoring FA Grants to 1 percent of Commonwealth taxation revenue is the centrepiece of the Australian Local Government Association’s upcoming federal election advocacy campaign.
The parliamentary inquiry report also called on the Victorian Government to pursue further Commonwealth support and collaboration to address the impact of the COVID-19 pandemic on the state’s businesses, social service organisations and vulnerable populations.