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Federal Budget

The Federal Budget honoured the major commitments made to local government during last year’s federal election campaign, the President of the Local Government Association of the Northern Territory (LGANT), Mayor Fran Kilgariff, said today.

Mayor Kilgariff said LGANT was pleased to see the continuation of the very successful ‘Roads to Recovery, and ‘Blackspot road safety program’. “Roads are a very important issue in the Northern Territory and while the Roads to Recovery figures released last night indicate no increase in the total for the Northern Territory the continuation of the program is welcomed”, said Mayor Kilgariff.

Mayor Kilgariff also recognised the increase of 1.6% in Financial Assistance Grants (FAGs) to Local Government but supported the Australian Local Government Association (ALGA) President Paul Bell in his call for the Australian Government to provide “a comprehensive response to the Fair Share report on local government financing and…. to stop cost shifting by state and federal governments to Australia’s 673 councils”. (See attached media release from ALGA President.)

Ends

11 May 2005

Contact: LGANT President Mayor Fran Kilgariff0419 376 060

Manager Communications Phil Maynard8936 2890

0429 090 833

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FEDERAL BUDGET 2005: LOCAL GOVERNMENT REACTION

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THANKS, JIM. ELECTION COMMITMENTS MADE GOOD, BUT THE BIG TASKS REMAIN AHEAD

The Federal Budget makes good a range of important commitments made to local government and local communities during the course of last year’s federal election, the President of the Australian Local Government Association, Cr Paul Bell, said tonight.

Cr Bell said ALGA was pleased to see the dollars match the promises on initiatives such as:

• Roads to Recovery program ($1.2bn)
• extension of the Blackspot road safety program ($90m)
• Australian Water Fund ($2bn)
• emergency management grant scheme ($30m)
• community safety programs ($30m); and
• council rural medical infrastructure fund ($15m)

“We also welcome tonight’s commitment of additional funding for childcare places, with local government to receive an additional $21.4m over four years.

“Also released with tonight’s Budget is a schedule allocating funds under the renewed Roads to Recovery program (which is scheduled to commence on 1 July) to each council.

Fair Share - big tasks still ahead

“These Budget initiatives are welcome. But two major tasks remain ahead for the Australian Government - a comprehensive response to the Fair Share report on local government financing and the development of a meaningful intergovernmental agreement to stop cost shifting by state and federal governments to Australia’s 673 councils, estimated to cost local government between $500m and $1.1bn each year.

“We know the Federal Minister for Local Government, Jim Lloyd, is well advanced with his plans for a response to the Fair Share report and has begun work on an intergovernmental agreement on cost shifting. With councils under increasing financial pressure, we encourage him to strive for the best possible response.

“Local government is not getting a fair financial deal and needs to have access to secure growth funds if it is to meet the needs of our communities into the 21st century.

“We need to move away from the archaic system of financial assistance grants to a fair share - just one per cent - of federal taxation revenue.

“As tonight’s Budget papers show, we’ve seen financial assistance grants as a proportion of total Commonwealth taxation revenue drop from nearly 1.2% in 1993-94 to 0.76% in 2005-06 and 0.74% by 2007-08.

“The need for a fair funding deal was made abundantly clear with the release of the parliamentary report – Rates and Taxes: A Fair Share for Responsible Local Government – in November 2003.

“Councils are faced with:

• escalating demand for social services;
• increasing costs of maintaining and renewing local infrastructure, much of it reaching the end of its useful life;
• widespread cost-shifting to councils by other spheres of government;
• rapidly ageing populations, putting pressure on revenue and services; and
• lack of real growth in state and federal grants.

“We don’t expect the Australian Government to solve all our problems – but we hope they will work with us to achieve a fair deal during the term of the current parliament,” Cr Bell said.

ALGA Budget analysis can be viewed at: www.alga.asn.au

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10 May 2005

Contacts:Cr Paul Bell0418 791 596

ALGA President

Rohan Greenland 0412 859 434

Director, Public Affairs(02) 6122 9434