Cessnock City Council has joined fellow councils from across Australia in lobbying the federal government to restore indexation to the Financial Assistance Grants.
Councillors voted at the general meeting on Wednesday July 15 to join a national campaign, along with support from Local Government NSW.
Financial Assistance Grant funding provides approximately 10 percent of Cessnock City Council’s total revenue and is used for essential community infrastructure and services.
Director of Corporate and Community Services Robert Maginnity said the loss of funds through the indexation freeze impacts on the quality of essential infrastructure and Council had to make some tough decisions on what services to cut back.
“Year one of the indexation freeze resulted in a reduction of nearly $170,000 from Council’s expected funding allocation.
“For an LGA such as Cessnock, we are reliant on these funds for local road programs in particular.”
The campaign is calling for indexation of Financial Assistance Grants, in line with consumer price index and population growth, to be immediately restored by the Commonwealth.
The three-year indexation freeze was announced in the May 2014 federal budget.
Local Government NSW President Keith Rhoades believes the previous level of Financial Assistance Grant funding did not keep pace with demand for services and infrastructure in local communities.
He said the current freeze to the indexation had only made things worse for councils across Australia and would result in a permanent reduction in the Financial Assistance Grants base of about 13 percent once the freeze ends.
