Speaking at the National Press Club on 31 March, Australian Local Government Association President, Councillor Geoff Lake, said the primary focus of his address was to highlight the role that councils play in Australia’s system of government and – more importantly – the role they might play in the future.
“It seems Local Government is increasingly everywhere. It has always been the roads, the footpaths, the drains, the street trees, the parks and gardens, the local golf course, the public swimming pool. But in the past 50 years or so, it is now typically also a provider of early childhood services, kindergartens, immunisations, aged care, libraries, art galleries, family counselling and community health.
“It is still the authority that predominately determines the look, the feel and development of our neighbourhoods and usually it’s at the heart of regional economic development and tourism strategies. If we were to list all of the things done by councils, we would come up with a list of more than 150, although no two councils would be exactly the same.”
He then turned to the key challenges facing Local Government today – funding and constitutional limitations – adding that reforms in this area would improve not only how Local Government functions, but our broader system of government in Australia.
To emphasise the important role that Local Government and local representation has, and always will play, in our system of government, Geoff Lake pointed to former Prime Minister Ben Chifley.
“It is hardly remarkable that Chifley was a councillor before getting into Parliament,” he said. “Many of our current members of parliament cut their teeth in local politics too. And Arthur Fadden, Earl Page and John Gorton are other Prime Ministers who had also served in Local Government. However, the fact that Chifley continued as a Councillor during his time – first as Federal Treasurer and then as Prime Minister is astonishing.
“You see Ben Chifley understood the importance of the local. He wanted to be as involved in the decisions affecting his immediate locality in which he lived, as in the big decisions affecting Australia’s war effort and its postwar reconstruction. He found that his capacity to shape issues as Treasurer or Prime Minister was enhanced by his understanding of service delivery at the local level.”
The idea of Kevin Rudd dashing home to Brisbane to attend a council meeting on a Tuesday night seems unimaginable today, however he said that Kevin Rudd is a strong believer in the importance of Local Government.
“In just two years in power, he has done more to develop a formal partnership between the Commonwealth and Local Government than any other,” Geoff Lake said. “Over the past year, he’s given councils an unprecedented $1 billion in extra funding for community infrastructure, he has established the Centre of Excellence for Local Government and he has invested in local government reform. In 2008 he founded the Australian Council of Local Government – an annual meeting between him, the cabinet and the 565 mayors from across the country.
“List any of the Rudd Government’s priorities at the moment – from climate change to the rollout of the National Broadband Network – and it’s pretty much pointless beginning a conversation about them that doesn’t include Local Government.
“Local Government has a key role to play in many national policy areas, and without our engagement, effective reform or rollout in any of these areas will be difficult to achieve.”
Turning to the fallout from the recent Pape challenge to the Federal Government’s direct payment to citizens as part of the stimulus package, he said although the validity of these payments was upheld, in doing so the High Court’s reasoning has created significant uncertainty regarding direct funding provided by the Commonwealth to third parties in other areas when it can’t be tied to a specific head of power in the Constitution. As such, money paid by the Commonwealth directly to Local Government could be unconstitutional.
“That’s why when Federal funding to councils was commenced in the 1970s by the Whitlam Government, the funds were channelled into Local Government through the States to overcome this limitation,” Geoff Lake said. “Plainly, this is an inefficient way to transfer funding.
“Since 2001 though, there has been a preference by the Commonwealth for specific program funding which involves payments directly to Local Government. This now amounts to hundreds of millions of dollars which councils receive each year directly from the Commonwealth for programs, such as investment into local roads. We see this development as a good thing and one which makes logical sense – as we see little point in State Government being the middle man.
“The High Court’s decision suggests that by continuing to directly fund Local Government, the Commonwealth is breaking the law. This is a real issue and it deserves attention.
“The current position, frankly, makes no sense at all and it’s an example of where the Australian system of government is out of date and needs reform.”
He said that Local Government believes that a referendum should be held during the next parliamentary term to consider whether a new financial power should be inserted in the Constitution to expressly enable the Commonwealth to directly fund councils.
“It’s as easy as amending section 96 – the section which sets out that the Commonwealth may grant financial assistance to the States on such terms and conditions as it thinks fit – and simply adding the words ‘and Local Government’.
“Not only would a successful challenge invalidate current and future funding, but it would also render all past payments to councils illegal and require the money to be paid back to the Commonwealth. It would bankrupt every council across the country.”
He added that the Rudd Government supports a change to the Constitution to clean this up, as do the Greens, with the Opposition also indicating its in principle support.
