The release of the Howard Government’s first Budget in this, its second term, could well be described as ‘the Budget you are having when you are not having a Budget’. Most commentators agree the real Budget will be brought down when, and in spite of recent deals with the Democrats, if the Tax Package is passed.
The Australian Local Government Association (ALGA) labelled the 1999-2000 Budget as ‘uninspiring for local communities’ and ‘starting the process of isolating the Federal Government from local communities’.
ALGA President, Councillor John Campbell, described the Budget as a missed opportunity. He said it should have set the scene for a new approach to supporting local communities as the new century starts.
The deal negotiated by the Federal Government and Democrats, but yet to be validated by the Senate, leaves responsibility for Financial Assistance Grants (FAGs) with the Commonwealth but fails to restore lost value to Local Government FAGS or link Local Government funding to a growth tax, a share of a GST or income tax.
All of this looks fairly ominous for the future of Local Government. However, ALGA is confident the Senate, and particularly the Democrats, will not turn their back on Local Government, rather they will continue to recognise that Councils have a major role to play in the wellbeing of Australia’s communities.
In spite of the euphoria of Treasurer, Peter Costello, over the $5 billion surplus, a better than expected growth rate of 4.25%, low inflation and interest rates, the fact is communities are still hurting. This buoyant economy is not translating across the board, rather many people are missing out. Within communities there are winners and losers, and this is also the case from region to region.
Local Government has been relentless in sending this message to Canberra, and certainly various initiatives announced in the recent Budget in regard to low income families and rural and regional concerns are a step in the right direction. However, the fact that some of these are tied to the further sell off of Telstra and the successful passage of the Tax Package through Parliament has not gelled well with many people, not the least being, in the case of Telstra, the crucial vote of Senator Brian Harradine.
The argument that the Government has a mandate from the last election to introduce a GST is based on people having a few weeks to consider an outline of the proposals in the heat of a Federal election campaign. Perhaps this is why the Australian Democrats won a number of additional Senate seats, as a check and balance, with voters seeing the Senate in its correct role, as a House of Review.
ALGA is hopeful the Democrats will continue to support its contention that, ‘Australians live and work in communities – the building blocks of our nation. The Federal Government must show that its policies are relevant to the real needs of communities. Local Government is the government of communities. Councils spend over $10 billion a year on infrastructure, economic and human services, and employ more than 140,000 Australians. The ability of local Councils to provide adequate services to local communities is, in significant part, impacted by Federal Government policies’.
ALGA rightly commends the Australian Democrats for upholding the view, during their negotiations with the Government, that the ongoing wellbeing of our communities is dependent upon the important partnership between the Commonwealth Government and Local Government, and that this partnership, built up over the past 25 years, is a non negotiable item.
However, it urges Democrat Senators to not turn their back on their policy going into the last election, that Commonwealth financial assistance to Local Government must be ‘linked to a share of income tax’.
