The Australian Local Government Association (ALGA) has continued to advocate for the restoration of the indexation of Financial Assistance Grants (FAGs) in this year’s Federal Budget.
The Association estimated that nearly half a billion dollars of council revenue has been lost as a result of the freeze, which was introduced in 2014-15.
President of ALGA, Mayor David O’Loughlin, said the freeze continues to have a serious impact on communities and councils, particularly those in rural and remote areas.
“Financial Assistance Grants are an important untied payment to councils from the Australian Government which are invested in essential community infrastructure and services ranging from local roads to swimming pools,” he said.
“As a result of this freeze, councils and their communities are missing out on expected revenue that would have otherwise been used to maintain safe and reliable road networks, fix local community infrastructure and fund crucial community services such as parks, libraries and community amenities.
“Many councils have had to make some tough decisions over the past three years on where to cut back to adjust to the reduced revenue levels, with some forced to cut services in areas such as childcare, defer or reduce road works and reduce operating hours for libraries and public pools.
“It has been a particularly painful three years for rural and remote councils which remain highly dependent on FAGs funding to meet day-to-day service-delivery costs; funding certainty is critical for these communities.”
The 2016-17 Federal budget out-years signalled an expectation that annual indexation of FAGs would return from 2017-18.
“Although we welcome this indication, it does not completely guarantee an end to the freeze,” Mayor O’Loughlin said.
“We need certainty in the Federal budget this May that indexation will be restored to FAGs and that our local councils will have the resources necessary to provide the level of services that every Australian community deserves.”
